It’s time to utilize deep customer knowledge

Last Updated: January 13, 2011By Tags: ,

With the increasing use of customer relationship software some companies hold more customer information than other companies. Still, it appears to be quite rare for companies to use this information to deepen their customer relationships. I am suggesting you use micro-segmentation to help pinpoint customer preferences and styles. This will enable you to formulate a customer-value metric which will assist to identify the customers and segments that deserve the most investment. I also suggest that more attention should be paid to triggers and major life events, this will help to identify and anticipate customers’ needs.

Deep customer knowledge is multifaceted and requires a multifaceted approach, the trick is to integrate various forms of customer reactions and comments (of various types), transactional data and some intuition.

What customers think can be found by undertaking focus groups and surveys. However, what they say and what they really believe are often different. Customers buying patterns can be found by analysing your transactional data, trends can be spotted in terms of what they have historically bought. What it doesn’t tell you is the reason why they bought, what they thought of the experience or what other options they considered.

Internal reports, benchmarks, and measurements will tell you as how your company is working but not if the processes in place are working your customers. These will inform you as how productive you are but not how effective.

Don’t get me wrong, all the above information is valuable. What makes it even more valuable is when you put them all together in a comparable way and you will start building a rich information set of resource and you can now seek to understand the linkages between them. With this deep customer knowledge you now have the ability to see the hidden messages.

Profound customer knowledge comes from integrating a variety of information sets. This is not an easy task; this will take quite a bit of planning, resourcing, and your will to do it. Analysing such rich customer information will help you to plan customer acquisition and retention strategies and this will enable you to revise and overhaul your systems and processes to be in tune with the changing marketplace.

Chintan Bharwada

Chintan is the Founder and Editor of Loyalty & Customers.

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To achieve better sales and profits, most companies could be doing more to cultivate business from their existing customers. However, enthusiasm for customer-retaining strategies must not endanger sound customer-getting efforts. How companies balance the two is the big question. To intensify reaching old customers while still seeking new ones, for many firms, will mean changes in market analysis, planning systems, management incentives, and marketing and/or operations organization. In the rush toward growth, consumer marketers have tended to regard success as stemming from obtaining new customers while unwittingly minimizing the importance of satisfying old ones. It is time for more companies to distinguish between their getting and retaining functions, to assess the balance between them, and to remedy any deficiencies in customer retention. This process requires management to value the potential of current customers and to treat them in special ways to get them to keep coming back. Several major elements should be part of the new marketing mix for customer retention: Product extras Keeping customers frequently requires giving them more than the basic product that initially attracted them. Product extras for individual customers over time can play a sales-expansive role. Reinforcing promotions Product promotion works better when aimed at existing customers. If a marketer knows who these customers are, benefits can be obtained by giving them reinforcing communications. Sales force connections The sales force can play a decisive role in the customer-retention function. At a retail or service counter the salesperson is the focal point of the company's strategy and is the firm to the customer. Post-purchase communication A company must anticipate that some customers will encounter either minor or serious problems after purchasing. If the firm is not ready to hear and correct these difficulties, the customer may not repurchase  or may cancel the the relationship. Whether company or customer is at fault, standby post-purchase activities can be instrumental in saving these customers.

2 Comments

  1. Chintan Bharwada January 13, 2011 at 2:47 am

    New post: It’s time to utilize deep customer knowledge http://bit.ly/fxcp2n

  2. Chintan Bharwada January 13, 2011 at 2:50 am

    Post Edited: It’s time to utilize deep customer knowledge http://bit.ly/fxcp2n

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