Adapted from “Distribution News”, 10 Oct 2002/Hsin-Yi Ho

While CRM (Customer Relationship Management) has become a global trend, corporations are trying to manage their partners as they do their customers. Riding this trend, SurfGold brought the concept of PRM (Partner Relationship Management.

Consolidating Technology and Marketing, Reinforcing Consolidated Services
SurfGold with its headquarter set in Singapore, has its markets all over Asia, including Hong Kong, South Korea, China, Thailand, Taiwan, Indonesia and India, etc. It is run by a group of professional managers from HP. These managers, relying on their sophisticated channel management experience gained in HP, hope to provide corporations with comprehensive services by consolidating the resources of technology and marketing.

The Taiwan subsidiary of SurfGold was set up in 1999. In the early stage, its customers were mainly from the IT industry, including the renowned IT companies such as HP, EPSON, Lemel International, Motorola, etc. Starting from this year, it has been expanding its customer base to other industries. Hawley & Hazel (famous for its tooth paste products Darlie and Colgate) is one of the examples, which started its business cooperation with SurfGold early this year. “We want to provide a system to make electronical all the procedures which are yet to be, converting all the data uncollected yet to valuable information”, said confidently Agnes Wang, the senior sales manager of SurfGold’s Taiwan subsidiary.

SurfGold, by combining marketing Ads and software systems and consolidating the services of both, helped many companies solve the problems that the online systems cannot match with demands. “Getting online is just the beginning of challenge. The key point is how to read into the online system data”, Wang touched the blind point that many companies have after the introduction of IT systems.

The successful CRM cases are few in Taiwan. In addition to expenses, that the systems have to be continuously adjusted to comply with the market situations is another reason leading to the failure. Instead, PRM, with the attempt to understand consumers via channels, is simpler and easier to get online than CRM.

Building Loyalty, Rewarding the Frontline
In consideration of this, SurfGold worked out a solution with emphasis on the “data mining management “ and “loyalty management” of the distribution channels.
The recommendations by channel sales usually have influence over consumers’ purchase behaviors. Yet the cost of increasing the channel loyalty is far lower compared with cost of increasing the consumer loyalty (around 1:10). Traditionally, incentive system is used to create loyalty. However, due to the difficulties that it cannot be accumulated for the long term and be rewarded down to different levels, it can only benefit the top sales. Therefore, it cannot stimulate the loyalty of many people.

Taking Hawley’s products for example, it will be easier for Hawley to adjust its marketing strategy on the outlet centers, pharmacy stores and traditional grocery stores than to adjust the marketing strategy on consumers. Furthermore, according to Wang, the promotion results and the experience collection are even more important. But the product makers, giving a considerable promotion budget every year, often have difficulty in providing sufficient workforce to understand particular consumer behavior. Therefore, it is important to survey channels via PRM, to understand the shipment and sales data of channels, and even the preference and recommendation by the channel sales.

Demonstrate efficiency via “Incentive Accumulation” System
In the past, incentives can only delivered to distributors or to vendors and agencies at most. But for many high-priced products, such as mobile phones, computers, etc., the sales skills of the sales people are the key in determining the sales. Therefore, SurfGold helps product makers reward the incentives to salespeople with the “incentive point accumulation system”. The system can accumulate data of the past; furthermore, it can skip the agencies, vendors and distributors to reward the incentives to the frontline sales.

Furthermore, this mechanism also gives the margin efficiency of communication. Product makers can send out the new product, promotion and consumer related information together with the incentive point bills to channel sales, so to enhance the delivery rate of company information. For example, said Wang, it took around 20 days in average for a certain IT agency to receive orders. But now, through PRM, the time of order can shorten to 10 to 14 days by at least a week time. This makes communication even smoother. “Channel sales accumulation behaviors can be created and can be repeatedly calculated”, said Wang referring to the PRM efficiency.