What do you really know about your customers? Most people can tell you who they think their best customers are and they are usually (mostly) right. But you may not be getting the whole picture. For example, a client once told me that all of their current customers were over 45 years old. When we did an analysis of their customer base, we found that they were right, however, we also saw a spike in customers who were in their late 20’s. It wasn’t until this moment that they realized a previous campaign to attract these younger customers was actually successful. At face value, one could say that they lacked effective campaign measurement tools, but that is a topic for another day. Suffice it to say, we all know that measuring effectiveness is critical for any successful marketing program.
WHAT ARE YOUR STRATEGIC MARKETING GOALS?
While simple things like profiling and segmenting your customers provides a validation of your marketing efforts, it isn’t necessarily actionable. It does, however, provide a baseline. So how does a marketer take action on this information?
Let’s start with figuring out what your strategic goals are. Are they focused on growing your business organically through new customer acquisition? Perhaps it’s cross-selling and upselling other products to current customers. Or maybe it’s to grow inorganically via mergers and acquisitions? Once you define where you want to go, then this is where things get really interesting. We’ll also table the discussion on the role of third-party data in M&A analysis for another time.
WHO ARE YOUR BEST CUSTOMERS?
At this point, you may be asking, how does a company define their best customer? Are they the highest spenders? Are they frequent buyers? Or is it those who buy your most profitable products/services? Maybe it’s even all of the above.
By providing an empirical definition of your “best” client(s), a marketer can then power modeling and other analysis to predict outcomes and behaviors. In addition to optimizing cross-sell and upsell initiatives, these insights can be leveraged to drive new customer acquisition efforts across all channels.
Third-party data helps marketers make better decisions. Want to learn more? Check out our latest eBook.
About the author: John has a dual role consulting on using alternative data for marketing data analytics and consumer credit risk decisioning at LexisNexis™ Risk Solutions. These roles intersect at many points throughout the customer lifecycle starting with marketing strategy (acquisition, cross-sell/upsell, customer service and retention) through credit underwriting and account management. The goal is to help companies increase organizational efficiencies and effectiveness using a pragmatic, empirical data-driven approach that allows for measuring, refining, and scaling customer insights across the enterprise.