Today’s business environment makes for a cut-throat landscape. Knowing your customers is one of the hardest challenges that face all kinds of businesses.
Online leaders like Amazon and eBay exercise a chokehold over an ever-expanding range of product categories, but the real secret to their success is their use of data.
A great deal of the online giants’ towering advantage is from their ability to personalise offers, by successfully gleaning data from their customers’ preferences and purchases. In fact, according to McKinsey & Company, 35% of all purchases made on Amazon come from the site’s personalised product recommendations.
Retail and hospitality businesses can take note from these online leaders and gain a competitive edge by knowing their customers inside out.
Why You Should Know Your Customers
Understanding your customers isn't just a good business practice; it's a crucial strategy for thriving in today's competitive landscape. Here's why:
Tailored Offerings
Personalisation is the cornerstone of successful businesses like Amazon and eBay. By knowing your customers' preferences and purchase history, you can tailor your offerings to meet their specific needs and desires. This not only enhances customer satisfaction but also increases the likelihood of repeat purchases.
Competitive Edge
In a market where giants like Amazon dominate, knowing your customers can give you a competitive edge. By leveraging data and technology, you can create personalized experiences that set you apart from the competition and attract and retain loyal customers.
Increased Revenue
Studies show that personalised promotions and offers are more likely to resonate with consumers. By knowing your customers and offering them personalized incentives, you can increase sales and revenue. Loyalty program members, for example, tend to spend more than non-members, highlighting the importance of knowing and catering to your customer base.
Building Lasting Relationships
Knowing your customers goes beyond just making sales; it's about building lasting relationships. By understanding their preferences, habits, and needs, you can foster meaningful connections that keep customers coming back time and again. Triggered messages, such as birthday gifts or thank-you notes, help solidify these relationships and create a sense of loyalty and goodwill.
How to Learn More About Your Customers
Keep track of your customers
The old approach of knowing every customer on a first-name basis is long gone. Purchase volumes have skyrocketed in recent years and it’s no longer realistic nor feasible to know each of your customers on a personal level.
Instead, you must utilise technology like customer engagement tools that enable you to effectively track and personalise every step of the customer experience. For instance, through automated tools for customer engagement that are integrated with their point of sale devices (EPOS), bar or restaurant owners can record each engagement and use this information to power their offers.
According to a study produced by Google, an estimated 85% of consumers say they would be more likely to shop at a brick-and-mortar store if it offered personalised promotions. Most business owners are aware that bringing customers back is pivotal to getting ahead, as research highlights that current buyers spend an average of 67% more than people buying for the first time. Personalised offers are a good way to encourage the customer to come back.
Create a database
Understanding your customers is fuelled by a solid bank of data, which is what you’ll need to tap into the strengths of the online giants.
You can begin to know your customers through a loyalty programme which seeks to offer rewards and incentives in exchange for demographic information. Customers reap lots of benefits by signing up to various loyalty schemes, and these provide a great way for businesses to track what and when people are buying or visiting your restaurant or store.
Remember, loyalty programme members typically spend around 30% more than people that aren’t signed up to a scheme, so the emphasis should be on creating reasons for someone to join.
For a way of incorporating this into the comprehensive customer journey, look to features like online ordering integration or engagement platforms that offer mobile payments, which allow customers to collect points online to redeem in-store and vice versa. Further, these tools give you insights into customer preferences and shopping habits, no matter where they buy.
By collecting this data, you are able to know customers and then effectively appeal to each one with the offers they want to see and, more importantly, the ones that will most likely increase their purchase frequency and amount.
Putting your knowledge to use
With your data gathered and technology in place you can start acting on all that priceless information you’ve collected.
Each campaign that you send to a customer, through an in-app message, SMS, email, push notification or otherwise, should be relevant and tailored to their interests. It’s no use recognising that someone routinely buys a coffee at the same store daily, and then handing them information on your new evening menu. Perhaps your bar is neighbouring their place of work but far from their house, so an out-of-hours visit is unlikely.
A more suitable offer could be a free coffee for every 10 they buy, or a cake to go with it. This step should be powered by automation to ensure you’re taking care of every person that makes a purchase. By setting rules for offers, brands can free up time spent delivering incentives, effectively streamline operations and deliver the best possible customer engagement. In fact, some engagement solutions will combine automation and customer data with artificial intelligence and machine learning to apprehend future preferences and successfully grow engagement further.
Triggered messages can range from a simple ‘thank you’ to a limited-time offer, across to a birthday gift. Such personalised prompts help you build lasting relationships with customers.
Conclusion
It’s not easy to fend off the advances of companies with bigger pockets, staff counts and operations, but that’s not to say it can’t be done. Through using data to learn more about your customers and give them exactly what they want, the practice of selling is made a whole lot easier. This capability is already available with a customer engagement solution inside your EPOS and can easily be brought to fruition.
Customer retention comes down to building engagement that’s based off customers’ preferences and knowing them is key to getting ahead. Technology and data are powering a new wave of businesses that are able to personalise every inch of a customer’s experience, giving them more of a reason to buy specifically with you.
To find out more about knowing your customers and growing engagement, schedule a call.
Como is the global leader in data-driven customer engagement solutions for hospitality chains. Their end-to-end solution integrates with 3S POS, other EPOS systems and any third-party services to provide businesses with all the tools they need to drive loyalty and maximize the lifetime value of every customer.