Profiling and segmentation are needed to target marketing campaigns, evaluate market potential, develop sales and new areas, identify where to locate new outlets, identify hot spots to target sales effort, and to help you customize your communications in terms of improved relevancy to increase sales.
Profiling your customers in essence refers to identifying the characteristics that differentiate your customers from people who are unlikely to ever buy your product or have need of your service. It goes deeper though to differentiate your best and most loyal customers, those that buy more frequently have a higher value from the rest. Not all customers are ideal some will purchase infrequently, won’t spend a great deal of money or will have little loyalty, yet will take a lot of your selling time. Knowing who to target is essential.
One approach to profiling is to first segment or group customers by their value to your business, then use critical data, census, lifestyle, market, business/consumer, and geo-demographics to expand segmentation and customer understanding. To do this we first statistically analyze customer trading data to determine how much people spend, how often they buy, what they buy, where they live, their life stage, what attracted them to your company, etc., then compute a score to identify your ideal customer.
Using the ZIP code, we add external profile data which allows us to accurately describe what your best customers look like. Then, using geographic analysis techniques, we can position your existing customers on a map to identify where geographically to find more of the same ideal customer.
If you are planning a product launch or thinking of expanding into a new geographic area, by applying some mathematics you can take into account of known competition and the brand life stage, we can estimate what a specific geographic area may deliver in terms of sales potential.
Territories created in this way will deliver economic benefits, and prevent territory cross sales. If you operate a location based business model, then choosing the right site to open your outlet has as much to do with the demographic profile of your customers as it does the physical location of the store.
With accurate customer profiles and people or businesses grouped by segment, the right analytical resource, tools and data including competitor locations, traffic patterns, parking, high target market density you will be able to determine how many stores you can open in an existing market, where you should expand your network, and which stores should be closed or consolidated.
You will also be able to select the business locations that are profitable and contribute strongly to your overall network. Perhaps most importantly, customer profiles enable you to target the right people using the right media and channels to get across your marketing and sales messages in an effective way at a minimal cost.
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