Understanding Customer Profiling - Get To Know Your Audience

What is customer profiling and do you really need it? Yes, you do. But only if you do it the right way. Because when you get it spot on, it's not as boring as it sounds. Plus, it's no longer an empty tick-boxing exercise you have to do every year. And yes, it will bring more money into your business. Ready to get all the juicy stuff about this? Let's go. SOME EPISODE HIGHLIGHTS: (0:14) Want a FREE resource to get more clicks on your emails? Check out Click Tricks.(4:06) Customer profiling demystified - what exactly is it?(5:19) Is there such a thing as too much segmentation?(9:15) How can small businesses effectively profile their customers?(11:15) Why do you want to collect customer data?(13:12) Start running (good) surveys.(17:18) The Phone Pshychic approach. (21:35) How to run calls with your subscribers.(26:45) Check out ResponseSuite.(28:22) Subject line of the week.[podcast_subscribe id="7224"]Customer profiling demystified - what exactly is it?What do we, as small business owners and email marketers, need to know about subscriber and customer profiling? Let's start with this. Customer profiling is all about taking the people on your list and working out who they are, what they want, where they are, and most importantly, whether they bought from you yet or not.So immediately, on your list, you can identify two types of people – those who’ve bought from you (i.e. your customers), and those who haven’t. And out of your customers, you have people who are super fans (and have bought everything you ever had for sale), those who only bought one thing a long time ago and then never again, and everyone else in between. Why is it helpful to have this information about the people on your list? Because it allows you to figure out what to do with them. Is there such a thing as too much segmentation? A mistake we definitely made when we got started was to apply tags within our email marketing platform that would give us loads of information about people, including what their interests were based on what links they clicked on in our emails. But did we really need all that information? Probably not. There are very few businesses that need to know that level of detail about someone. Most of us don’t need a huge granular level of tagging based on people’s interests.If you have products that align specifically with each of those interests, then great. But if you don’t, then too much tagging is definitely a thing. Ultimately, you want to boil the business down to what you sell and then understand what would be useful information to have so that you can sell to those people. In other words, all you have to do is find out enough about people in order to be able to sell your product. That way, you can identify those you should sell to versus the ones you should keep away from.So as a tiny business, you don’t need hundreds of segments. You wouldn’t send different emails every day to each of your segments anyway - most people struggle with just sending one! It’s great to have segmented data in your list, but if you have too many segments, you can't easily do anything with any of them. And that's a bit of a problem, don't you think?How can small businesses effectively profile their customers? Let’s look at some of the ways you can divide people up. First of all, segmenting people based on whether they've paid you money (i.e. they're customers) or they haven't yet is too generic - it doesn't provide enough information for you to make good business decisions. What you also need to capture about all your subscribers are the following three fields:Recency. This includes the date when this person last bought something from you. If they haven't bought anything yet, that field will be empty. Frequency. This is a numerical value of how many things the person bought from you. And Monetary (value). This tells you how much money this person has spent with you so far. How you apply this in your specific business is going to be different, but against each contact in our list, we hold these three custom fields. It's worth pointing out that this information is only useful if we’re going to do something with it.Why do you want to collect customer data?One of the reasons why we started collecting this data is that we want to be able to identify the people who have bought something recently. And we want to do that so we can make them another offer while they’re in buying mode with us. They're focused on what we sell, and they're investing and learning. So this is a great time to offer them something else.Obviously, because you also hold Frequency information, if you know that person's already bought everything you have to offer, there’s no point in reaching out and asking them to buy something. And if you have a lot of people on your list who fall into that category, you might have an opportunity to create a new offer. The opposite is also true – if you’re thinking of creating a new product but you know that most people haven’t bought your existing offers, then you might want to generate some interest in what you already have instead.Also, by looking at the Monetary custom field, you can find the people on your list who’ve spent the most money with you. Those are your high investors – the people who really like your stuff. So maybe you can offer them something more premium.There’s a lot you can do with customer data, including pulling out averages. On average, when did most people last buy, for example? Or how many products have they bought? How much are they spending with you? Over time, when you collect and analyse this information, you'll be able to see how you’re doing and break up your subscribers into key customer segments. Start running (good) surveysCollecting statistically useful customer data automatically and in the background is the first step towards customer profiling. That's based on the spending behaviours of your subscribers. But there's more you can do. And that's reaching out to your subscribers and customers to get their input. How do you go about that? One of the methods we use (and that we’re big fans of) is running surveys. Good surveys though – not ones that are terrible, too long, and no one will want to complete! We like to create really simple surveys to collect data about what people are struggling with, what their biggest priority is right now, and what they’ve tried in the past. We ask a bunch of simple questions to allow people to give us data that’s going to enable us to make business decisions.But we can't stress this enough - before you send out your survey, ask yourself what you're trying to do with the information you’re about to gather. Don't send out surveys for the sake of it! You want to ask questions that serve you and your business – what specific decisions are you trying to make? Based on that, you’ll then decide what questions to ask. For example, if you’re trying to find out how your audience refers to the problems they’re experiencing, ask them questions that allow them to give you that. Only collect information that you know you’re going to use.Another key thing is to make sure you only send your surveys out to a small percentage of your list – something like 10%. And then watch the results come in. When you see the answers, you’ll know whether you’ve worded your questions correctly in order to get the types of responses you want. If people aren't taking the questions in the way you intended or you aren't getting answers that are useful, then you can refine and adjust accordingly (if you need to).[thrive_leads id='8822']The Phone Psychic approachThis is about jumping on a call with people. It doesn't have to be the phone - it could be on Zoom, Skype, or some other digital platform that allows you to speak to your audience directly. We regularly have calls win our non-customers – i.e. the people who haven’t bought from us yet. This allows us to collect qualitative data about our subscribers and their current position, mindset, and state.When running surveys, we generally collect stats and data to segment and target people accordingly through multiple-choice questions and answers. But during these calls, we ask them questions that lead to longer-form answers. We prod, poke, and push in the right direction. If you’re inside our membership The League, you’ll have seen our battle plan called Phone Psychic. This has our entire approach and breaks down all the questions to ask so you can identify the people to call and decide what to do with the data. It also details how to get on a call with people in the first place because you want a good angle for that. One of the key things you want to do during these calls is to pick up on the language that your audience uses. For example, we noticed that our subscribers and customers rarely use the words revenue and profit. They talk more in terms of making more sales. And so that's the phrase we tend to use too - it's more...