Over the past 6 months it has been hard to ignore the roller coaster ride of Bitcoin, Ethereum, and the myriad of other alt-coins that have rushed in to take advantage of all the hype surrounding cryptocurrencies. While experts will strongly disagree on the staying power of digital currencies, they all agree that Blockchain is the real hero of the story. That said, let’s take a look at how this rapidly emerging technology has the potential to impact Customer Relationship Management as we know it.
What is Blockchain?
Simply put, blockchain is an immutable, decentralized ledger that provides a public record of each “block” that is interlinked to all the other blocks in the chain in a specific sequence. The contents of each block employ the highest levels of cryptography and give all interested parties 100% confidence that the records are accurate and secure. This ledger is a permanent record that cannot be changed or falsified in any manner.
How Blockchain will change CRM
With this basic understanding of how Blockchain technology works, we can now discuss how CRM could potentially be improved and enhanced. These impacts expect to be felt across the industry within the next 2 years or less. Here are the most obvious and likely areas that benefit exponentially from the application of Blockchain technology:
This is the most obvious area of increased performance that the application of Blockchain will be seen. Each individual “block” is connected to the block created before it and the block that was created afterwards. Cryptographically sophisticated network keys only allow authorized users to gain access to a particular block.
Generally these days, almost all Customer Relationship Management databases are located on cloud servers. These centralized systems present a static target that ultimate could suffer a catastrophic security breach. While security in the cloud continues to improve, Blockchain takes the game to an entirely new level. The blockchain exists in a completely decentralized setting and is constantly updated and verified by peer-to-peer networks and geographically diverse nodes around the entire globe. This characteristic makes the blockchain virtually tamper-proof and eliminates the possibility a catastrophic failure or security breach.
Presently these are many middlemen and third-parties involved in all sort of transactions. Utilization of Blockchain will allow organizations to deal more directly with their customers in a more complete and meaningful way when sharing proprietary analytics or sensitive financial data. Not only will the speed of business increase, but the likelihood for errors will be greatly reduced.
Increased User Confidence
The Equifax breach in 2017 exposed over 143 million consumers sensitive financial data. Individuals and entities have become hyper-sensitive to how their personal/proprietary information is being stored and/or used. Blockchain technology will allow CRM applications to give users greater control over their identity and who may have access to what information that is a part of their profile or digital identity.
Consolidated, Clean Data
A common complaint of CRM users of all variety is the level of inaccuracies and duplicity that has to be dealt with on a regular basis. This muddies the waters for all parties involved. Companies get better insights into their customers and customers can have a single, consolidated view of their relationship with your company. Blockchain technology allows customers to each be represented by their own unique block on the chain. This can eliminate such common issues as duplicate and inaccurate records creating stronger more efficient engagement with the customer.
There is a huge opportunity for companies to apply Blockchain technology to drastically improve the ROI and engagement with loyalty programs. Unfortunately, most programs today do not increase Customer Experience as much as they could. The use of the Blockchain could increase customer confidence in the security of their personal data as well as make them easier to navigate and utilize.
As it is today, consumers are enrolled in a myriad of programs that all operate in their own unique way with their own method of value and redemption. A single, unified wallet for loyalty programs on the Blockchain will make it very simple for the consumer to transact across brands and industries to tailor their engagement based on their preferences. This would also force companies to rethink their programs and find new ways to entice customers by offering more value.
We all know that Customer Relationship Management is applied across every industry and business model. For the past decade we have seem dramatic disruption of most of these industries. Blockchain and other technologies like self-driving cars are not only changing entire industries, but the way the way we all live, work, and play. At this point it is not a matter of if Blockchain will impact CRM, but when.