3 Reasons to Get to Know Your Customers
This year $700 million of Amazon’s ad budget will not go into any actual advertising. This is not a clerical error or some major gamble the company is making. Amazon is intentionally allocating this money outside of internet ads and commercials with a single purpose. This money will help the retail giant better understand its customer base and how to reach them.
Spending one’s ad budget on current, rather than potential, customers may appear counterintuitive. Nevertheless, most modern corporations are doing exactly that. Whether it is Amazon, Apple, or Lidl, these corporations are willing to spend inordinate amounts of money understanding customers that already buy from them. So, here are three reasons successful businesses get to know their customers:
Getting to know customers improve service. This is why Alibaba spends millions collecting data on the number of orders made on computers versus mobile phones. Using these insights large retailers know exactly where they should improve their services to satisfy customers. This, in turn, gives customers a better overall experience. The same could apply to small businesses. By getting to know current customers, SMEs could be better positioned to improve their services based on changing consumer tastes. Whether it’s by investing in online order capabilities or initiating loyalty campaigns, responding to customer insights might be one solution for improving customer satisfaction.Better Marketing
Learning about current buyers shows you how to attract new customers. Although current customers are by definition not new customers, many corporations study why existing customers chose their business to learn how to target consumers in a similar position. Perhaps their hours are very convenient for consumers in surrounding areas. Perhaps their discounts and loyalty programmes are comparatively better than local competitors. Whatever the reason, a customer's motivations for choosing a business can be used to expand customer bases. This is a benefit which is not necessarily specific to large corporations. If SMEs leverage customer insights in a similar fashion, they can connect better with those who would most benefit from their services.
Cut Unnecessary Costs
Knowing your customers helps save money. This is precisely why automakers like Ford and Mercedes have drastically cut down on the car lineup they produce. Customer insights have allowed these auto-manufactures to track consumer tastes and see exactly where they could cut expenses. These cost-saving benefits could also be adapted for small businesses. By getting to know their customers better, SMEs can see which products go unsold at a mathematical level and respond quickly.
An Ocean of Information
There are obvious benefits to knowing one’s customers. However, the actual process of developing customer insights might not be as obvious. Unlike the large corporations mentioned earlier, most SMEs do not possess the budgets necessary to amass massive amounts of data. Moreover, they may not have the extensive data acquisition experience of larger companies. Fortunately, advancements in digital commerce have made this process much more accessible for small businesses. With consumer insights technology and loyalty programmes from companies like LoyLap, it has become easier to learn about customers. The choice, however, is up to every business owner. One can decide to finally access the sea of information before them or to let the waves wash past them. What will you do?