Think you really know your customers? If you're relying only on basic profile information and purchase history, you probably don't. According to a new study, marketers at 80 percent of brands lack the customer data to drive effective marketing campaigns.
Marketing solutions provider Yesmail Interactive and market research firm Gleanster surveyed 100 senior-level marketers at mid-size and large business-to-consumer (B2C) companies to gain insight into the businesses' customer engagement. The report revealed that most marketers simply don't have enough information to send the kind of personalized, targeted campaigns that would keep customers returning to those brands. The key to earning market share, says the report, is building customer relationships. The best way to do that is to harness "relationship-oriented data," such as information on social media use and online behavior. Less than half of the survey respondents base their marketing campaigns on these types of data, which provide far better targeting than basic transactional data or demographic information like gender and age.
The study found that 86 percent of respondents thought improved customer data would allow them to better perform segmentation, meaning that the majority of brands are missing out on the opportunity to build stronger, longer-lasting customer relationships. In an interview with BusinessNewsDaily, Yesmail Interactive president Mike Fisher offered the following tips for small businesses looking to improve customer-engagement strategies:
1. Maintain the customer lifecycle. A customer lifecycle is the length and nature of a customer's relationship with a particular brand or company.For marketers, the goal should be to make the customer's lifecycle as long and prosperous as possible. That means maintaining and continuously improving the continuum by taking customers on a journey that's mutually beneficial for both the customer and marketer. Maintaining the cycle involves acquiring the customers, retaining their interest in the brand and extending the relationship beyond a single purchase.
2. Look past the purchases. The Yesmail/Gleanster studyfound that over half of marketers have an excellent understanding of past purchase behavior. While this information is the most likely insight beyond basic demographic data to influence campaigns, it doesn't go far enough. Less than a quarter of marketers are using channel-preference data, propensity scores or household composition. These three often-overlooked pieces of information will reap results, both because of their inherit value and because your competitors likely aren't considering the information.
3. Use all available data. There is a plethora of information marketers simply do not have access to when crafting customer communications — behavioral data, Web analytics, online/offline profitability, etc. It's impossible to account for something you don't know exists, which seems to be one of the main issues for marketers: a lack of access to an overwhelming amount of customer profile data. With the rapid growth in digital channels, the only way for marketers to remain competitive is to use all of the information about their customers that is available.
4. Think like a big business. Small businesses should think like large businesses, then act using the tools available to them. Analyzing data may take place on a smaller scale and in a spreadsheet rather than via a custom-built system, but this analysis is still more valuable than simple hunches or preconceived ideas about who your best customer might be. If acting on that data means sending individual emails or making individual calls, so be it. At least you know you're targeting your best possible customer. Small and medium businesses actually have an advantage when acting on insights and reacting to market trends. For large businesses, it's often a challenge to present data and propose ideas in a way that resonates with senior leaders. Similarly, institutional habits can be difficult to overcome for businesses that have been established for some time. Solopreneurs or small teams of entrepreneurs don't face that challenge. Take advantage of your flexibility, and experiment intelligently to find what matters to your customers.
5. See what's right in front of you. While it's important to append existing data and obtain the most complete profile of your customer as possible, don't ignore information that's right under your nose. Seven out of 10 marketers ignore social data. With Facebook analytics and other free tools available, there's no reason to overlook insights into how consumers interact with your brand. When searching for more insights, it never hurts to ask customers. Most will readily give information so long as they receive something in return. Loyalty cards, social media interaction and surveys can be great ways to obtain the insights you need.
6. Identify and act on customer triggers. Go to your customers, don't wait for them to come to you. Half of all marketers act on request-based, inbound triggers. The Yesmail/Gleanster study found that most marketers ignore life events and threshold triggers (such as spending up to a certain amount). These are the customers most likely to spend or keep spending. Identify your most important customers, but don't forget to determine the most valuable time to reach them within their lives and purchase cycles.
7. Challenge assumptions. This is as much a business philosophy as a marketing tactic. Don't assume that methods and practices that have worked well for the past year will work in the future. Consistently reframe your existing data and insights to make sure you have (and, more importantly, are acting on) the best available data.