Paper info

ROI on CRM: a customer-journey approach

Francis Buttle and Lawrence Ang

The paper was published at the 18th IMP-conference in Perth, Australia in 2002.

We discuss an issue critical to companies that invest in Customer RelationshipManagement (CRM): how to assess return on investment (ROI). A number of issues makethis task challenging. First, defining the boundaries of CRM; second, establishing whatconstitutes a CRM investment; third, deciding what counts as a 'return' on thatinvestment; and, finally, choosing the time frame to use in the assessment. We firstreview the literature on the effectiveness of CRM, and then propose a customer-journeyapproach to computing ROI on CRM. This approach traces the customer's value frominitial acquisition, through development to retention. We then propose a series ofresearch propositions that can help inform how business performance can be affectedwhile implementing CRM.