Customer profiling may sound like a politically incorrect term used in airport security but it’s actually an innocent business term for understanding who your customers are.
Imagine a manual for how to most effectively reach your target demographic with details on what they like to buy, how much the spend, how they use your products or services, what will help retain their custom and what matters most to them as consumers. That is your customer profile.
How to create your ideal customer profile
Customer profiles help you understand the things that matter to your customers so you can tailor your offerings and messages to better appeal to them.
Selling products and services without understanding what your ideal customer looks like is akin to doing paint by numbers with your eyes closed. You’ll get paint on the canvass, so in a sense, job done, but it’s not going to look pretty.
Let’s examine how you can easily create a customer profile to determine your target demographic.
There are four simple parts to creating profiles for the customers your business should be targeting: Describe. Connect. Locate. Understand.
The first thing you need to do is create a description sheet for each of your ideal customers. You need to determine, in a broad sense, the two or three main types of customer you have or want.
Build profiles by sorting customers using these basic criteria:
- Demographics – age, gender, income, location, etc.
- Psychographics – personality, values, opinions, attitudes, interests lifestyles etc.
If you work B2B then what you should define includes: Sector, number of employees, revenue and budget, national/global reach, and decision-making process.
Each type of customer will have varying motives for why they chose your company or your product. Not appreciating their individual motives means you cannot address their individual needs. Don’t lump them together.
Lots of companies use data-mining or just good old-fashioned polling of their customers to gather information. Interview your current customers and ask them what they like about you, what they don’t; what attracted them to you, how they found you originally; what makes them stay, what makes them want to leave; what others do they wish you did, what you do others don’t. Encourage complete honesty.
The information you get back will enable you to create your customer profiles. This information is vital in so many ways. It not only allows you to use that information in the most effective manner for your market strategies but also gives you invaluable feedback on your strengths and weaknesses.
Knowing where your customers are isn’t as simple as where they live. We covered that kind of location in demographics. What you want to know is where they go — be that physically or digitally. Where do they spend their time? What websites are they visiting? What papers do they like to read? What social media networks are they attracted to? What do they search for on the internet? Where do they go on holiday? What continents do they prefer to visit?
When you understand where your customer types are at any given time you can target them more effectively. You might be spending money on ad spaces in a national gym with loads of members but few of them fit your customer profiles. That’s wasted money but it can sometimes seem like a good idea to go for numbers.
Knowing where your customers are located can help you decide what numbers make more sense. A small online forum where the average user is 60% likely to fit one of your profiles or a national newspaper with 5x the active readers but with an average profile fit of 25%?
We all have a purchasing process — an unconscious method for making spending decisions. Understanding what drives your customers to make the decisions they do is a key part of building a winning strategy.
You need to understand what their problem or need is. Are they making purchases proactively or reactively? Are they trying to fix a problem or fulfilling a desire? How are they researching solutions to their problem? How are they researching ways to fulfil their need? What benefits are they looking for?
How are they making their final decision? Are they looking at reviews? Comparing features and benefits with competitors? Are they buying on a whim? Do they need to get approval?
When you understand how they make purchases you can tailor your message to speak to them on their level. Your strategy can be designed to match the flow of their purchasing process resulting in higher conversions.
One of the best ways to create specific profiles for each distinct group is to name them and give them a picture — this is known as a persona. Visual aids are really helpful in building customer personas and familiarising your team with the motives, desires and concerns of that type of customer. Also, down the line it will enable seamless switching of strategy between customer sets.
An extraneous example would be marketing for a new face cream. A broad target would be “active females in their 30s and 40s”. Customer profiling could allow you to break that down into ‘Molly the stay at home mum’, ‘Charlotte the career woman’ and ‘Adventurous Alice’.
Molly is in her mid-30s; she has two children, one at school, the other is under a year. She lives in the suburbs, drives a hatchback and has a household income of $80000. She doesn’t get much sleep so is concerned her skin is starting to look tired. She wants to try a new face cream but is easily put off by negative reviews on a mum’s blog forum she visits most days.
Charlotte is in her late 20s, has no children and is dating. She drives a convertible, lives in the city, travels for work a lot and earns $50000. She has noticed a few wrinkles around her brow and wants sometimes to help smooth them. She’s always busy so tends to take the advice of sales clerks or chooses products she has seen in her favourite magazine which often has free samples.
Alice leads a very active, outdoors lifestyle. She surfs, cycles, swims, rock-climbs and runs. She’s into extreme sports and spends most of her life in the sun. Alice is worried her lifestyle is drying out her skin and wants a product that is compatible with her activities. She tends to use consumer comparison sites to find the best deals and research the benefits of products.
All three would benefit from using the same product but they have different motives, purchasing processes, incomes, backgrounds and lifestyles. You can’t create a campaign that will reach everyone but by creating customer profiles you can create appropriate and targeted campaigns for your ideal customers.
Acutely targeted marketing strategies, created with these ideal customers in mind, should enable you to better reach the new and existing customers to positively affect sales and grow your business.