The best marketing strategies usually focus on the customer; her needs, wants, desires, dreams and more. Knowing who the customers are and where to find them as well as understanding their likes, dislikes, and demographic information helps companies build products that customers want to buy, price them accordingly, and promote them in all the right places.
How Customer Profiles Hurt and Help Marketing Strategies
Ignore this marketing strategy and suffer the consequences. Remember New Coke? This short-lived product was the brainchild of a marketing department. Imagine their stunned surprise when customers openly rebelled against changing the 100 year old Coca-Cola formula. New Coke developed in a vacuum, with marketers talking to marketers. Although the company did formal market research, they failed to truly understand the wants, needs and desires of what drove customers to prefer Coca-Cola over Pepsi or other soft drinks.
The opposite side of the coin is Apple. The Mac computer was considered more user-friendly than the IBM-PC for many years. IBM eventually copied the user interface to make the Windows operating system. But for many years, many people chose a Mac as their first computer because Apple understood their customers. New customers needed picture menus, not scary memorized codes. New customers wanted to download photos of their vacation, play with graphics, and have fun. Through understanding their customers, Apple dominated the market for many years.
Building a Customer Profile
Building a customer profile is a team effort. Engage not just the marketing department, but sales, accounting, and finance. Accounting and finance can contribute sales data and shopping information. The sales team also collects information on customer preferences, usually in a CRM system, that can also add to the marketing department's profile efforts.
To begin a customer profile:
- Gather lists of customers who have made purchases over the past year
- Sort the list according to zip code
- Pick the top 5 zip codes that occur most frequently
- Visit the U.S. Census Bureau and search for each zip code. Information may be obtained on average household size, occupation, salary and more.
- List the customer demographic information- median age, income, type of city they live in, etc.
- Tally up the information that occurs most frequently
Does a pattern emerge? Generally some type of pattern will emerge, whether it's income or location.
If the data file is too big for an individual to handle, there are many database companies that specialize in developing customer profiles from data.
Conduct Market Research to Complete the Profile
Market research does not need to be expensive. There's quite a lot of information to be gleaned from simple Internet searches. Some easy market research techniques to complete a customer profile include:
- Seek free studies, white papers and case studies on various demographics. If the customer profile indicates that females age 40 with average incomes of $75,000 and up purchase most frequently, begin Google searchers on "market research for women" "what women buy" and "marketing to women.'
- Visit websites frequented by customers in the target demographic. What is the look, feel and tone of the site? What information is included on the home page? Women in the demographic segment above frequent sites such as Martha Stewart Living, iVillage, and others. By looking at the articles these sites feature, marketing managers can develop and informal picture of customers' needs and desires.
- Look at companies that cater to these demographics. For the female demographic above, a savvy marketing manager would visit Ann Taylor, Lane Bryant, Banana Republic and similar retail clothiers to look at styles, colors and brands that appeal to the target demographic.
- Ask customers for their input. Very simple surveys can be created using online tools such as Survey Monkey or Constant Contact. Simple paper-based questionnaires can be included in monthly billing statements for pennies a copy. By offering customers and easy way to respond online plus an incentive to respond, such as a free gift or gift card, companies can ask customers directly about their lifestyle, choices and preferences.
Building a customer profile creates a solid marketing foundation for companies. The customer profile can guide the company's choice of product, price, place and promotion- the so-called "four P's" of marketing strategies and marketing plans. Begin building a customer profile today to better target customer acquisition and increase sales and profits.
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