Why do we profile customers?

Why do we profile customers?

When you’re growing your business, finding the right customers is crucial. But how do you make sure you reach the right people to help your business thrive?

This is where consumer profiling comes in!

What is consumer profiling?

Customer profiling is the practice of organising customers into specific groups possessing similar goals or characteristics.

In other words, when you literally create a data-led profile of your organisation’s ideal customers. The profile will present details about certain demographics, customers’ likes, dislikes, plus their purchasing habits.

Assigning every customer a profile allows organisations to target products, services and communications in a consistent manner that resonates with a group of customers.

The key to customer profiling is to narrow down the list of potential groupings to those that are relevant to the targeted customer base and the organisation’s product offerings. Ideally, customer profiles will describe a group of consumers rather than individual buyers or end-users. Customer profiles can then be used to identify the best products or services to pursue, create relevant messaging or marketing campaigns and attract a target market.

Customer profiling is important because it forces an organisation to focus on the specific consumers they want to pursue and create products and services that are more attractive to that audience while also realising economies of scale. The practice of customer profiling is similar to the practice of customer segmentation.

Benefits of customer profiling

  • The ability to tailor marketing efforts to relevant audiences.
  • Personalization of customer experiences to increase brand loyalty.
  • Can provide a more holistic view of market potential.
  • Improved customer satisfaction
  • Increased response, click or open rates.
  • More potential customers, prospects and customer types are identified.
  • Increased sales and revenue.

Crafting an effective customer journey is a challenge, but an exciting one that requires creativity, focus and a deep understanding of the customer’s needs and behaviours. That deep understanding is central to the task, and its starting point is the customer profile.

When we say customer profile, we aren’t talking about a profile of an individual customer; the term actually means customer type — a template of a customer who is representative of a group of customers. The customer profile is a goal-centred representation that helps the marketing and sales teams zero in on what a typical customer who matches the profile will respond to, such as what channels will reach them, what content will attract them and what touchpoints will be most critical.

Customer profiling differs from other strategies built around customer characteristics. Unlike generic demographics or market segmentation, differences in geography or socioeconomic status don’t necessarily factor into a customer profile. Customers can be widely dispersed in age, location and income and still be represented by the same profile — online buyers of jazz music, for instance, or shoppers seeking affordable home electronics.

Marketing efforts that build on customer profiles are much more likely to reach and resonate with the target customer. Additionally, those marketing efforts will be more efficient, require less time and investment to implement and will result in greater dexterity in crafting customer journeys. Here are some guidelines to create effective customer profiles.

Demographic profiling

Demographic information allows you to better understand certain background characteristics of an audience, whether it’s their age, race, ethnicity, income, work situation, marital status, etc. By asking demographic questions in surveys, you can gather demographic information about current and potential customers at scale, and in turn, help you design a market segmentation strategy to reach the right clients.

Simply put, demographic questions are any question(s) that aim to better understand the identity of a particular respondent.

Demographic surveys (surveys that use demographic questions) seek basic information about respondents that allows the survey designer to understand where each person fits in the general population.

This kind of information is useful in many scenarios: You can benefit from it when developing products, measuring ad effectiveness, providing health services, understanding public opinion—even selling cars.

Geographic profiling

In Maharashtra, it is known as Pani Puri; Haryana it is known as paani patashi; in Madhya Pradesh fulki; in Uttar Pradesh pani ke batashe/padake ; in Assam phuska/puska; Pakodi in parts of Gujarat, Gup-chup in Odisha, Andhra Pradesh, South Jharkhand, Chhattisgarh Phuchka in Bengal, Bihar and Nepal.

These all refer to the same dish essentially, but are called different things depending on where in India you are, and even prepared with different condiments and flours.

These seemingly minor differences are significant because they help companies cater to the local customer profile. Understanding how a location affects a buyer’s behaviour will influence what products a company promotes and what marketing messaging they will use.

Grouping people based on their location is known as geographic market segmentation. The geographic segmentation definition includes targeting customers based on where they live, work, or travel. To understand people’s preferred locations, marketers perform market research, often using surveys to uncover regional preferences.

The more companies know about peoples’ values, culture, and habits, the better they can design products that meet their needs. Market fit is essential for companies to sell their products. Discovering where a person lives, works or dreams of travelling tells a lot about them, and marketers want to use that information to sell to their target audience.

Psychographic profiling

Psychographics seeks to understand the cognitive factors that drive consumer behaviours. This includes emotional responses and motivations; moral, ethical, and political values; and inherent attitudes, biases, and prejudices.

Gathering and analysing this data allows marketers, advertisers, and researchers to create detailed “psychographic profiles” of audience segments, which are then used to create relevant messaging for those segments.

This is valuable to marketers and advertisers because, even within clearly defined demographic groups, there is often significant variation between individuals. Just because two people are roughly the same age and earn similar annual incomes doesn’t mean they share similar political views or personal values, for example.

A psychographic profile contains information about a person’s interests, hobbies, emotional triggers, and lifestyle choices, among other data. This could provide insight into why someone might buy a specific product, support a given cause, vote a certain way, and much more.

Behavioural profiling

Customer behaviour profiling is the process of using customer data to understand how clients interact with your product and company. Sometimes, this is augmented with data from outside databases, such as census data. The data is used to categorise customers, which allows for target market-specific advertising. By tailoring your marketing efforts to the behaviours displayed by your target market, the chances of selling your product are increased. Consumer behaviours are affected by psychological, personal, social, and geographical factors. These factors are used to segment the market into different categories, based on aspects such as their preferences, lifestyles, their current stage of life, and various other distinctive attributes and traits they possess. Grouping consumers enables you to perform an analysis of your product and determine who to sell to, and how to market your product.

Put simply, behavioural profiling identifies the subconscious behaviours that make up our ‘preferences’. These are the ones that we often retreat to when we are under pressure.

Next step:

A common next step is to create personas that present your profiling research in neat characters, which your business can use as typical customers.

You and your colleagues can then bear these profiles in mind when developing everything from products to messaging. With consumer profiles like these, you can add some context to your customer journeys and provide an even more tailored product or service.

Professional Customer Profiling – Aeon Research

Aeon Research has more than a decade of experience in providing reliable and accurate market research across India. Developing an understanding of your consumer requires careful, rigorous and reliable research along with immaculate execution. Aeon Research provides you with one of these crucial aspects: the research. Leave the data to us and you will have more time to execute and strategize with perfection. Contact us for personalised research services.