Legendary baseball player Yogi Berra, once said, “You can observe a lot by watching”. Although he said it with regards to baseball, it’s quite true, especially in the field of marketing.
As marketers, we should always be observing our customers – their behavior, habits, likes, and feedback. They provide a great way to measure your business’ relationship with its customers.
If you’re not watching your customers, most probably your competition is.
It’s like driving your car. When you’re behind the wheels, you constantly keep monitoring the vehicle’s metrics, such as, speed, fuel levels, engine temperature, while also observing traffic and road conditions. If you don’t keep an eye on what’s happening, it can lead to an accident.
Some might say that revenue and profitability are the most commonly tracked metrics. As long as they’re going up, why should anyone care? However, it’s important to remember that just as these numbers go up, they can also plummet. Customer preferences can change in a heartbeat – due to a competitor product, new marketing channel, or a new regulation – and if your company is caught off-guard, then the next month’s sales numbers won’t make you happy.
Measuring customer metrics enables you to have a solid understanding of your customers, and spot warning signs before it’s too late, as well as discover new growth opportunities and growth areas. Luckily, today’s marketers have an unprecedented access to tons of data.
Here are 5 steps marketers can take to turn data into actionable customer-insights:
1. Monitor customer activity regularly
Marketers should continually be reviewing customer information. Metrics have become the lifeline of marketing, and today’s measurement tools make it easy to track and report near real-time data for detailed analyses.
As you gather data, ensure that you not only review primary results but also keep an eye on secondary information:
- Primary data refers to high-level metrics such as total sales, top selling products/services, generated revenue, top revenue channels. Primary metrics are more strategic in nature and help you understand if you’ve achieved your business goals, and if your marketing strategy is working. They also tell you where to look, in case you’re doing too well or if things aren’t working as expected.
- Secondary information goes a level deeper to give you insights about geographies, type of customer, time of purchase, volume, category-wise breakdown of sales, and price levels.
So how to go about gathering customer insight? Start by looking at the data available in your customer relationship management (CRM) system. A strong CRM platform, such as SalesForce, not only captures detailed customer contact information, but also helps you analyze granular data and discover patterns in customer behavior.
Combining CRM data with your marketing data can give you interesting insights and allow you to design highly targeted marketing campaigns that are more effective. For example, you may discover that customers in San Francisco have a better email response rate than those in Chicago. You might also realize that these customers are likely to buy your product after just two emails. You may also learn that Chicago-based customers make their purchase on weekends from retail stores, while San Francisco customers also respond to Facebook campaigns and purchase on Fridays from your website.
If your business has a loyalty program, you can also analyze its data to identify your most frequent buyers, understand where they live and how frequently they buy your products. You can use this information to find similar customers and hopefully convert that segment into loyal customers.
2. Ask for customer input
There are multiple ways to obtain customer feedback, and surveys are probably the most commonly used vehicles to do so. But companies need to go deeper to get valuable customer insights.
Since customer preferences change quickly, it may seem impossible to get an accurate idea of customer behavior. But asking the right questions and using the right feedback channel can get you a clear understanding.
Most businesses use basic surveys, asking about product favorability or customer satisfaction, both of which, though valuable and necessary, give limited insights. They only give you a single data point of customer’s opinion, and it becomes difficult to ask follow-up questions to probe deeper, to find out the underlying reasons for the response.
In-person interviews and surveys can be a lot more helpful, in this regard. Select a handful of customers and ask open-ended questions, which will help you discover the keywords and phrases they use to describe your product or service, as well as understand their body language. Such interview always provide more information than standard surveys.
While conducting in-person surveys, ensure that you not only include your loyal customers but also the ones who aren’t loyal. It’s best if you can talk to customers who bought from your competitors, since you’ll know why they chose someone else over you.
3. Build customer relationships
Marketers are always looking for influencers who can evangelize their products & services, and help attract new customers. However, your best influencers are right in front of you – your customers. Satisfied customers are your best salespeople, and building good relationships with them can lead to a strong word-of-mouth promotion and result in higher sales.
Developing and maintaining relationships with customers is a crucial step towards building customer loyalty and creating evangelists. Although it appears like a simple idea, it’s easier said than done.
The first step to build a relationship is to know your customers well. This will help you spot the potential influencers and cultivate them. That’s why it’s essential to have a good CRM system that helps you manage your marketing and communication.
If executed properly, this process can give you a deep understanding of your customers and you can reward their loyalty with special deals, keep an accurate record of all the communication & feedback, and spot downward trends before it snowballs into a disaster. Instead of contacting customers by day of the week, you can contact them based on specific actions, such as registering for a contest, downloading coupons, or referring a friend.
If customers feel that your business meets their needs, or even exceeds them, they’re very likely to speak favorably about it and rate it highly on review sites like Yelp and Google reviews.
4. Measure twice, cut once
Experienced woodworkers and carpenters use this trick of measuring everything twice before cutting the wood, because once you’ve cut it, there’s no going back. The same is true for marketing campaigns.
Marketers already apply this principle when they ask for multiple variations of advertisement or brochure from their graphic design team, for use in their marketing campaigns, and finalize the design after A/B testing.
A/B testing allows you to create variations of your marketing content (emails, landing pages, brochures), display each variation to a small subset of your target audience and measure the performance of each variation. You may narrow it down to two designs, which are tested on different customer segments to find out which one drives a better response.
A/B testing is a useful data-driven process to optimize marketing campaigns. It’s essential to test your message before sending it out to your full audience. For example, if you’ve sent an untested email campaign to your customers, it may be tough to recover if it’s not effective.
If you’ve been monitoring customer insights, you’ll already be confident about your campaign messages. In such cases, A/B testing will help you optimize their effectiveness. In fact, if you use CRM tools and marketing automation platforms, you can A/B test your message against various customer segments, such as power users vs casual users. This will enable you to tailor your marketing campaign for each segment, so that it resonates well with the target audience.
5. Understand communication channels
In today’s multichannel world, the better you understand how your customers interact with your business, the more effective your marketing strategy will be. Customers don’t get their information from a single communication channel, they get it from multiple channels such as social media, email, websites, search engines, radio and television.
If you know how your customers get their information, you’ll know where to find them and how to reach them. For example, if you know which social media platforms your customers use, you can customize your marketing campaigns accordingly. You can offer special discounts to Twitter followers, make product announcements on Instagram, and use Facebook for customer support.
An unhappy customer might go to Facebook to post his complaint, thereby showing it to all your followers. If you’re active on Facebook, you can immediately help the customer and show others that your business cares about customers, is interested in helping them, and values customer satisfaction. This will help you gain trust in your brand, build customer loyalty and attract new customers.
In 2015, a frequent-flyer on one of the airlines was facing problems with his account and unable to reach the airline. After many unsuccessful attempts, he tweeted about his complaint. Still, he got no response. On the other hand, he caught the attention of a competitor, who said he could transfer all his miles and maintain his well-earned status. It just goes to show that if you don’t take care of your customers, your competitors will.
As marketers, you need to know your customers. They’re not just entries on a spreadsheet. Each one of them has specific needs, and have decided that your business meets those needs. If you set up a process to regularly gain customer insights, you’ll be able to understand how & why people buy your products/services, and grow your business faster. Else your competitors will swoop in and take them away.