2009 was a year to buckle down and take stock of your business - where to gain efficiencies, reduce costs and reevaluate staffing. But as spending gradually begins to pick up, it's time for businesses to put the focus back where it belongs -- on your customers. But how well do you really understand your target market? How do you go about finding out what makes them tick now?
A Business Dilemma
Strategies developed only a few months ago may no longer be effective as consumers adjust to a "new normal." Age-old questions that you've put on the back burner may now come to light anew:
The Power of Data-driven Insights
Since your customers' actions are likely to speak louder than their words, wouldn't it be great if there was a way to learn exactly what those actions are? A good place to start is with a "do it yourself" approach. Use Excel and set up a spreadsheet. Start inputting customer data with every sale. Don't be afraid to ask your customer what inspired them to do business with you.
Create a spreadsheet for customer data that includes fields most relevant to your business. For example:
As your customer data builds over time, you will probably be able to do some predictive modeling around the future. Look for trends. Who are your repeat customers? Can you segment your customers into "highest value", "average" and "worst-value"? What's motivating them to return? What are your best-selling products? Does this vary by time of day or season? With these results, you can tailor your future product offerings, hours, and promotions and get more bang for your business buck.
If it sounds a little daunting, there are credible vendors that can provide this type of information to you. American Express recently launched a new analytics and consulting division called Business Insights, which draws on transactional activity between merchants and consumers to identify the critical facts, figures, and trends you need to help make the best decisions for your business.
Unlike conventional research from third party suppliers that relies on static, self-reported information or surveys, American Express Business Insights combines timely, aggregate trend analyses based on real-world behavior to provide exceptional business planning and marketing expertise.
Getting in Touch With Your Customers
Whether you do it yourself, or hire professionals like American Express Business Insights, tracking customer spending patterns and behavior can help boost your business.
Seek advice from your local Small Business Association or Chamber of Commerce. Look at a business you consider the next level of success and find out if they are using this type of information to grow. Only you know what's best for your business. But if you are looking for growth, or improved efficiencies, tracking customer behavior can be a great way to predict future buying patterns. Using this information empowers you to give your customers what they want, when they want it - and, ideally, boost sales by attracting new customers.
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