The secret of every successful business is understanding your customers which is possible only when you'll analyze them closely. Real customer analysis is, however, easy to say but hard to perform.
At times, customer research only touch the surface and concentrate on irrelevant data. The research that teams perform laboriously produced isn't actually utilized by the company or in its marketing initiatives as it seems too vague.
Effective customer analysis relies on in-depth research which is discussed with the entire team. This analysis target the essential factors as well as information on what drives their purchasing behavior.
We'll walk you through each stage of the customer analytics process in this blog that will help you know exactly how to do a customer analysis. Before that let’s look at a brief on customer analysis.
What Is Customer Analysis?
Customer analysis is the process of discovering more about your customers by using both qualitative as well as quantitative data. Its objective is to identify their desires, requirements, problems, and goals.
Customer analysis enables us to comprehend what motivates consumers to make purchases, as well as how, when, and how frequently they make purchases.
Focus groups, in-depth interviews, social media analytics, consumer feedback from the past, and other research techniques are used by companies that perform customer-centric data analysis to better understand their customer base. As a result, they can modify their business procedures to satisfy the actual needs of their clients.
Customer analysis may appear a difficult task in the beginning. So, we'll help you in the analysis but before that let's look at a few reasons that make customer analysis important.
Importance of Customer Analysis
Here are a few specific justifications for why you should implement customer analysis:
- enables you to customize your marketing and communications to speak the customers' language and address their needs.
- enables segmentation to improve consumer targeting and boost ROI
- helps you decide where to spend advertising dollars and what marketing channels would best reach clients.
- assists in your understanding of how to make your goods or services better.
- enables you to improve connections with customers and general customer loyalty.
Step-by-Step Process: How to do Customer Analysis?
As you know how you can achieve so many goals via customer analysis, it's time to see how to do a customer analysis. Let’s jump to the 9 steps that you can follow for this.
1. Differentiate Your Existing Customer base
You can more clearly grasp the types of customers you might want if you are aware of the ones you currently have. Customer-based classification is thus one of the initial phases in your customer research which implies the grouping of customers based on certain characteristics.
The goals your firm has depends on how you segment your market. For instance, in a B2B setting, demographic information is not always required. Only provide details that would genuinely influence how you would promote your good or service.
Brands frequently divide customers into various groups such as Geographic, Demographic, behavioral, psychographic, benefit, buying decisions, etc.
Social media platforms, CRM tools, paid ads, market analysis, and other data sources are some of the places where you can find such information.
However, if you provide a high-value good or service, spending the time to interact with your customers in-depth is generally the most beneficial strategy. This will enable you to learn more about your customers' needs, ask follow-up questions, and gain a deeper knowledge of their emotional needs.
2. Figure out what makes your customers click by speaking with them
Hours can be spent online researching. However, you won't know a customer's actual feelings unless you talk to them.
Focus groups, questionnaires, and in-depth interviews with current and prospective customers must be conducted if you want to do a successful customer study.
You can use one of two main forms of research:
- Quantitative Research includes finding data through surveys and analysis from websites, apps, third-party sites, etc.
- Qualitative Research includes finding your target market’s opinions through in-depth interviews and focus groups, among other formats.
You shouldn't merely wander around for bits of irrelevant information with these. Before approaching anyone, you should be aware of your end goal.
You'll gather more actionable information if you focus in-depth on just one subject rather than attempting to discover everything about your customers at once.
You'll always have time to pick up new information as you proceed because customer analysis is a continuous process. Additionally, by focusing on a single topic, you're more likely to discover information on how consumers view your brand than you might have anticipated which is always the best type.
3. Use Existing Customer Feedback
Customers already contact you when they want to raise a complaint, request assistance, or express satisfaction with your product. When trying to understand customer goals and problem issues, paying attention to all of this existing customer feedback and helpdesk requests can be immensely helpful which is known as Voice of Customer analysis.
Various VoC programs can assist you in analyzing customer reviews on various platforms such as Google Play Store, App Store, Google, social media channels, etc. to determine where your business excels and where it falters.
VoC data will frequently provide you with an understanding of how your customers think, speak, and even write. For instance, why did they specifically request a refund? What aspects did they find lacking but didn't consider important enough to demand a refund for? What unexpected benefits did your product provide for them?
4. Communicate with Your Team
Even though everyone on your team is employed by the same company, not everyone has the same perspective on customers and, consequently, doesn't understand what makes them tick. The marketing staff may be aware of the type of copy that encourages customers to schedule an initial call, for instance. While the sales team may comprehend what eventually encourages customers to convert. Account managers may know what keeps customers satisfied daily. Customer success managers (CSMs) may, however, know how to go over and above to keep them.
It can be tremendously powerful for a team to pool customer insights because it allows for a comprehensive approach to customer analysis. For instance, one approach to achieve this is for marketers to participate in sales or CSM meetings to better understand the customers and vice versa.
When working with major B2B accounts or clients from particular industries, for instance, this can be helpful for teams when not everyone deals with the same customers.
5. Use Analytics wisely
Analytics can offer a depth of information about customers and their behavior. If you make use of a CRM platform, you might already have access to internal data regarding customer profitability, behavior and value.
For instance, Facebook Audience Insights and Google Analytics both have a strong value. You may use them to find out more about how visitors engage with your website and social media profiles.
You can check out, for instance: How site visitors find you, The usual customer experience, How long they remain on a page, what proportion leave right away, The hyperlinks that your visitors select, etc.
You can learn more about their routines, interests, and actions with this.
6. Create various Buyer Personas
It's now time to put these research conclusions to use.
Combining all of the information will make it easier to spot trends and connections across interview responses, sales team comments, and competitive insights. The portrait of a buyer persona should emerge from these shared characteristics; all that is left to do is to record all the findings and communicate these personas with the rest of the business.
In the buyer personas, you can include Demographic information, professional information, and other things such as Frustrations (pain points), Factors influencing buying decisions, Their expectations of your product/service, Preferred communication channels, content types, and formats, Known/preferred brands and influencers, etc.
7. Make use of personas and customer analysis results across the entire organization
If only a few key employees at your company use your customer analysis and buyer personas, they won't be very useful. They must be utilized throughout the entire organization; doing so will help you maintain successful and consistent communications.
When developing these personas, we advise gathering support and input from every customer-facing department. Once finished, it's important to discuss the personalities and explain how to apply them in an all-hands meeting or departmental workshops.
Give each team's leader a goal at the same time so they can start implementing the research's discoveries. Following up and updating personas consistently is crucial, so keep doing that.
Let's now examine how different teams might benefit from buyer personas:
Sales teams use them to increase conversions and create stronger long-term customer relationships, help marketers develop their content marketing strategy and plans, product managers and developers specify new product features and enhance already existing ones, and design teams to produce visuals and web pages that appeal to customers, as well as to construct user interfaces (UI) that are intuitive and enhance the user experience (UX).
8. Determine and prioritize segments and personas based on the research
The main dilemma at this point is how to choose which personas to prioritize for your brand.
Customer Lifetime Value (LTV), which measures the average value a customer contributes to your business throughout the relationship, is possibly the most crucial indicator to pay attention to. It makes sense to concentrate on the customer profiles that, over time, raise your LTV.
A distinct customer journey map for each persona may also be useful. Based on their difficulties, inquiries, preferred platforms, and preferred content kinds at each stage, this map will help establish how to draw in, hold their attention, convert them, and upsell them to certain personas and segments.
Using your personas and customer journey maps, determine the best ways of advertising & content delivery, selling features or differentiators to emphasize, best call to action, right influencers, etc.
9. Keep the scope for change
Customers are always shifting. Many people's favorite communication channels have changed since the pandemic began. Their demographics have also altered; a lot of individuals have moved to the suburbs.
The values of people have also altered. Many people now prioritize spending time with their loved ones over putting in long hours or pursuing a large promotion.
It's important to gather customer input in this dynamic climate. Additionally, to make sure your research and buyer personas are up to date, you should frequently conduct customer segmentation analysis and voice of the customer analysis. Otherwise, you run the risk of your pitches, marketing, messaging, or products getting stale.
One of the most crucial things you can do for your company is customer analysis. When done correctly, it affects all aspects of your business, from your marketing messages, sales pitches, and product features down to your customer loyalty and retention.