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How to understand your audience using customer profiles

Understanding your customers is key to attracting them and building profitable relationships. Here are the essential things you need to know about understanding your customers – and how you can create customer profiles to provide a clearer picture.

What is a customer profile?

A customer profile defines the type of person you’re trying to reach. Profiles are identified by researching a client base and segmenting customers into groups. These groups can be segmented down to include anything from age through to buying habits. 

To start the process of defining your customers ask yourself the following:

  • If your customers are individual consumers, typically how old are they? Do they tend to be male or female, or are they equally split? What sort of occupations do they have? What interests do they have?
  • If your customers are other businesses, what size are they? What sectors do they operate in? Who else supplies them?
  • Where are your customers located? Around the world? Within this country? In the local area?
  • What are your customers’ spending habits? How much do they spend? Are they repeat customers or just one-off buyers? Do they buy little and often, or infrequently?
  • What motivates your customers to buy? Do they buy from you to meet a basic need such as warmth, hunger, or to meet a practical business need? Or do they buy because it makes them feel good? Do they buy with their head or with their heart.
  • Are your customers influenced by seasonal or industry cycle trends?
  • What is the most important aspects for your customers: price; quality, or service?
  • How do customers access your goods or services? Online or in person? How do the pay for them? Cash? Credit card? Via an online payment system? Do business customers pay on credit?
  • Depending on your type of business you may be able to profile several types of customers. For example, regular customers and occasional customers.

 

 

How do I get the information I need to create customer profiles?

There are various ways to get the information you need to build customer profiles.

Look at market trends

If you sell goods or services to individuals, look carefully at relevant consumer research reports and make note of any trends. If your customers are other businesses, try to put your hands on market research for your industry sector – this can  provide revealing insights into what’s currently influencing customers’ purchasing decisions.

Analyse records

Analyse your existing customer records. For example, go through your sales figures, customer records and database. Identify customer characteristics such as their locations and how frequently they place orders. Look for patterns such as when the most profitable customers tend to place orders, when certain types of products or services are in most demand, what products and services different customer groups buy, etc.

Make use of a customer relationship management (CRM) package

A customer relationship management (CRM) package is software that can do most of the analysis for you. It enables you to segment your customers according to their spending patterns, their likes and dislikes, important characteristics, and so on. They help you to understand your customers and to target the most valuable ones with personalised messages and offers. Some CRMs can cost less than £10 per month.

Customer research

As well as using existing information to help understand your customers, you can also carry out customer research (see the section entitled How can I use customer research to help me understand my customers? below for more information). 
Look at market trends

If you sell goods or services to individuals, look carefully at relevant consumer research reports and make note of any trends. If your customers are other businesses, try to put your hands on market research for your industry sector – this can  provide revealing insights into what’s currently influencing customers’ purchasing decisions.

Analyse records

Analyse your existing customer records. For example, go through your sales figures, customer records and database. Identify customer characteristics such as their locations and how frequently they place orders. Look for patterns such as when the most profitable customers tend to place orders, when certain types of products or services are in most demand, what products and services different customer groups buy, etc.

Make use of a customer relationship management (CRM) package

A customer relationship management (CRM) package is software that can do most of the analysis for you. It enables you to segment your customers according to their spending patterns, their likes and dislikes, important characteristics, and so on. They help you to understand your customers and to target the most valuable ones with personalised messages and offers. Some CRMs can cost less than £10 per month.

Customer research

As well as using existing information to help understand your customers, you can also carry out customer research (see the section entitled How can I use customer research to help me understand my customers? below for more information). 

Checklist: How can I use customer profiles?

Customer profiles can help you in a number of ways. Login to save this checklist to your profile for future use. (To register to join and enjoy the benefits of membership click on the link at the top right of the page. It will only take a few minutes to create your profile).

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How can I use customer research to help me understand my customers?

There’s a range of customer research techniques that you can draw on.

  • Surveys and questionnaires

Customers don’t always have the time or inclination to fill in surveys, but you should always provide them with opportunities to let you know what they think. You might want to offer an incentive to complete a questionnaire – be it to be filled in by hand or online – such as entry in a prize draw. And always thank them for completing a survey.

  • Comments

You can’t come up with questions that cover every single point a customer might have a view on  (nor would you want to or else the questionnaire would take an eternity to complete!) so always have an area where people can leave comments and suggestions. You never know – you might get some suggestions for ‘killer’ products or services you could develop.

  • Online reviews, polls and forums

These have revolutionised customer feedback for consumer products. Perhaps more useful than the simple ‘likes’ and ‘dislikes’ indicators or emoticons, are the comments or reviews that people can add. These are a great way to get to know what customers think.

  • Follow-ups

Contact your customers by calling, emailing or speaking to them face-to-face as part of your after sales process. For example, if a retailer recognises a customer they should ask them how they got on with the product they purchased. A car service business could phone the customer a few days later to check that they’re happy.

  • Focus groups

Questionnaires and suggestion boxes can get you so far, but to gain a more in-depth understanding of your customers you could run focus groups. These are facilitated meetings run over a couple of hours with invited customers, in which their needs and wants can be explored in some detail. Keeping things informal and providing lunch can incentivise customers to attend.

  • De-briefing

Businesses that serve other businesses should ask for an opportunity to have de-brief after a project has been completed. For example, a consultancy business that’s delivered a programme could meet with the key stakeholders from the client’s side a few months after implantation to find out how things are progressing. Doing this as webinar rather than face-to-face may boost participation.

  • Key questions

No matter what method you use to seek customers’ views, always ask the most important question of all: ‘Is there anything we could have done better or anything else we could be doing for you?’

  • Respond

Don’t give customers the impression that their feedback has disappeared into a void. Find ways to let them know how their comments were welcome and that they’ve been used constructively. Where anyone has said they are happy for you to contact them personally, make sure you follow up with an email or phone call as appropriate.

Can I use complaints to better understand my customers?

No business likes to get complaints from its customers, but negative feedback can be used to achieve positive results. Studies show that dissatisfied customers whose problems are resolved to their satisfaction can end up becoming more valuable than customers who never have problems.

Many dissatisfied customers never complain. Instead they moan to their friends and colleagues and simply take their custom elsewhere. So it pays for you to not only make it easy for someone to let you know when things go wrong, but also to actively check that they’re happy. You may get the occasional customer who makes an unjustified complaint in hope of a discount or to get something for nothing, but most people are genuine. Listening to what they have to say helps you to understand what customers expect in terms of quality, price and service.   

Do all you can to encourage customers to contact you, whether they have an issue, a question, a suggestion, or even something they want to praise you for. Instead of hiding behind your website, clearly display a contact number and provide an email response facility.

What other ways are there to get to know my customers better?

Create opportunities to keep in contact with your customers and encourage them to communicate with you.

  • Send them e-newsletters informing them of the latest development with your products or services and inviting them to respond
  • Call important customers regularly, but not to the degree it gets annoying
  • Keep in touch on social media
  • Hold events, such as lunchtime seminars about developments in your industry
  • Invite customers to mini-social events, such as a drink and a mince pie at Christmas, or to celebrate the opening of a new outlet, product, or service
  • A business owner intently listening to some customers who are chatting with them at a social event.

All of these are opportunities to ‘sell’ your business, but remember that your prime aim is to get to know your customers better – so make sure you do more listening than talking.