In order to entice people to buy your products or services, they must believe at some level that they need it to succeed. So, how do you convince someone that they need what your business has to offer? By truly understanding what they want and need – and delivering it at precisely the right time.
By getting a better grip on your customers’ needs, you’ll be able create more personalized experiences and establish a competitive advantage in the marketplace. In this article, we’ll be addressing the most important questions and aspects of understanding your customers:
- What does it mean to know your customers?
- What happens when you don’t know your customers?
- How does knowing your customers impact your business?
What does it mean to know your customers?
To address this question, I’d like to share a real-life example. Let’s jump back to 2014, where I spent most of my weekends running a newly opened family restaurant. My expertise in
This experience involved the environment of the restaurant as a whole: the music, the lighting, the table layout and most importantly, how staff interacted with our customers. In my opinion, it was essential that we not only defined the experience but that it was consistent. And, looking back at our TripAdvisor reviews even now, I can see we did pretty well!
More importantly, we understood our customers’ needs and expectations. We served East African cuisine, which is a new experience for the large majority of people. So the first question we’d ask every single customer was “Have you had this cuisine before?”
If they had (great!), we’d asked them what they liked last time and structure the meal and drinks around this. If they were brand new, then we would talk them through the menu, highlight the most popular items, what drinks go well with what food and give them a few minutes to think this over. Customers felt comforted by the expectations set – not thrown into the deep end. They took our recommendations warmly almost every time.
We were most successful when we identified our loyal customers and made sure they were aware of how much they were valued. They would be the first to try any new things, which was always nice. I tried to reward them by letting them try new beers or new dishes – on the house.
Word-of-mouth marketing made our business grow and at our peak, we were ranked #1 in London on TripAdvisor. Why? Because our customers loved us – and we tried to share how much we loved them. We would even see the same customers on Friday and Saturday night – just with different friends; they wanted to share our customer experience with their friends and felt emotionally tied to the restaurant.
What happens when you don’t know your customers?
At Emarsys, customer intelligence is much more advanced than this. Some of the most common challenges we see business face across industries include the following:
- Customers buy once but don’t buy again
- Many people subscribe for information but never buy
- The large majority of customers are inactive
- Customer spending behaviors are largely unknown
A lack of awareness of customer spending behaviors might not seem like a top concern until we think of a realistic example. Considering that most businesses want to focus on their inactive customers, win-back campaigns are important. But, what happens if you send a 10% discount to a customer who spends $100 per order and also to one who spends $1,000 per order? What happens if you give a blanket “Free Delivery” coupon to both of these people as well? Suddenly this win-back campaign isn’t as profitable.
How does knowing your customers impact your business?
When it comes to revenue contribution in commerce, there is normally a small percentage of customers who contribute the large majority of revenue. For one company we work with, just under 10% of its customers contribute 70% of its revenue. Suddenly this 10% of customers is hugely important.
A lot of marketers have access to “big data,” but this means nothing if we don’t use it. Customer intelligence identifies patterns of purchase and browsing behavior among your customers, so that you can treat them as individuals and keep them coming back to your store for more.
To move away from generic marketing campaigns and define a more personalized customer experience, as we did at my restaurant, we must achieve a better understanding of our customers’ needs. Once we’ve collected and analyzed the relevant customer data, we can then prioritize our marketing campaigns and ensure they are kept as active as possible.