Kitcatt Nohr Digitas

If I’ve heard it once this week I’ve heard it a thousand times. ‘I don’t need an iPad. But I don’t half want one.’ Apple remains a shiningly positive example of a marketing practice which so few brands seem able to master. Namely, cross-selling more products to people who already have a plentiful sufficiency of goods in their homes which bear the same logo. 

We’ll return to the colossus of Cupertino in a moment. But first a quick digression down memory lane. Remember the dot com boom? Around the same time there was a less widely-reported but equally exuberant tulip bubble which I’ll call the CRM bonanza.

It came in the wake of Seth Godin’s book ‘Permission Marketing’, which was essentially a shrewd and timely re-clothing of the direct marketing idea for the Internet era. It was led by a cabal of software developers and management consultants who preached that anyone with a brand, a database, and their proprietary flavour of contact management software could clean up through the miracle of cross-selling.

Nearly a decade and a half has passed since those heady days. However, throughout this period, the average number of house-label products held by the typical British bank customer has remained more or less static at somewhere between 1 and 1.5. Hardly a resounding endorsement for the proponents of CRM-driven cross-selling. What is the reason for this dismal under-delivery?

The answer came to me one day in a bank branch in Marylebone High Street. I was the guest of Gladys, a vigorously blue-rinsed customer service assistant on about £18,000 a year. She’d kindly offered to show me the reality of life in retail banking as seen from the other side of the bandit screen.

It’s cosy back there amongst the small change bags and the elastic bands, so Gladys and I soon developed a close rapport. I watched in awe as Gladys dealt out notes like a card shark and engaged her clients in just the right level of genial banter. Each time she swiped a customer’s bank card, the CRM screen below the bandit glass flashed her a cross-selling prompt.

I’d spent the previous week being briefed by the team that had designed and implemented this amazing piece of kit. In the blink of an eye, the system would analyse the customer’s last ten transactions and use regression-modelled algorithms to determine the next product to promote, based on the customer’s projected propensity to buy. The brochure claimed that the system’s lead programmer had previously written the software for the anti-missile battery that protects Moscow. This was cutting-edge stuff.

However, Gladys wasn’t having any of it. Well, that’s a slight exaggeration. When she agreed with its recommendations, she would act on them. But most of the time, she ignored her artificially intelligent help-mate.

Towards the end of the day, a young builder came in to bank his pay packet. He wanted the money paid into his savings account, which was the only product he held with the bank. Quick as a flash, the CRM system recommended Gladys to sell him a current account. And equally quickly, she ignored the advice.

Not without some trepidation, I asked Gladys why she hadn’t taken the cross-selling cue. She smiled and sighed, as if about to explain the wisdom of the ages to a pale naif. ‘I know the kid,’ she said, ‘I know his mum. He’s still living at home. He’s saving up for a car. If his wages went into a current account, he’d only spend them. I know that. He knows that. But this here machine doesn’t, and that’s why I ignored it.’

Thus two thousand pounds of education falls to a ten rupee Jezail. Or, more accurately, a bank’s brand equity is built more effectively by an £18,000 a year employee than by an £18m IT programme. A cheap and not entirely justified jibe, I know. But the key point is this: rather than investing in cross-selling, wouldn’t it be better for brands to think in terms of cross-serving?

Arthur C. Clarke once said that any sufficiently advanced technology is indistinguishable from magic. I think it’s equally true that any sufficiently advanced marketing is indistinguishable from service.

Like Gladys and every other naturally talented customer service person, the best cross-selling programmes and initiatives out there are driven by a genuine understanding of what customers need.

Take Abbey’s wonderfully simple event-triggered current account programme, which makes sensible deductions from customer events and uses them to suggest appropriate and timely products and services. Or TUI’s envy-inducing loyalty communications, which use behavioural targeting to tempt customers into expanding their destination repertoire.

At a slightly grander level, the same desire to serve underpins the best NPD projects. Just check out O2 Money, the much-deserved winner of this organ’s own 2010 Innovation Award. This was no mere speculative scattergun brand-stretch. Instead this initiative was based on a fundamental understanding of the money transmission needs of young urban nomads.

Surely this can’t apply to Apple? After all, who actually needs a device that’s too large to be a PDA but too small to be a usable notebook? Such commentators forget the truth that all Aston Martin salespeople know: a want is just a need that has yet to find its rationale.

This column originally appeared in Marketing Week.