Why Knowing Your Customer Drives Smarter Growth (and Higher Profits)

It is one thing to have an idea or who your client is. But it is a very different to know them. The more companies learn about their target audience, either through purchase data, reviews, focal groups or other methods, the better they will be positioned to unlock growth.

Thanks to the adoption of AI in marketing and the availability of more industry and consumer data than ever, companies have never been in a better position to meet their customers in a way that drives the smartest growth and the greatest profits.

Provide more personalized customer experiences

The main objective of meeting your client is to better understand their needs and why they would use their products or services. One of the most obvious examples of this comes from the recommendations of Amazon custom products, which suggest a relationship of goods with an article that a client is consulting. These suggestions are extracted directly from the company’s own data based on what other customers have bought, as well as the history of the individual.

The Amazon data -based model has become a powerful element to boost additional growth and sales among its existing customers. Already in 2013, the recommendations “also bought” represented 35% of Amazon sales. The success of this model has played an important role in the positioning of Amazon as the online retailer for so many customers, which makes other retailers try to replicate this design.

Understanding your client can also be applicable in less oriented to retail environments. For example, a Buzzrx report found that women from 30 to 39 years filled the largest number of mental health and ADHD recipes in the United States of any demography.

For medical care providers, understanding the greatest prevalence of these conditions in this age group (as well as what recipes are more commonly filled) can lead to higher quality care. While not necessarily the relationship with profits, this personalized support can help medical care suppliers retain patients and provide better care.

Adapt your messaging properly

Knowing your client also allows the Emarter marketing to probably result in higher sales. By understanding customer needs and preferences, marketing specialists can ensure that their campaigns reach appropriate people, on the right platforms, with the correct type of messages. If any of those three factors is off, your marketing budget could be wasted.

In addition, when obtaining a deep understanding of your target audience, you can adjust your messages and tactics as necessary as circumstances change. For example, duration of the height of the pandemic, Lowe’s launched a commercial that highlights several ways in which suburban parents could turn their backyard into a fun place to spend quality time, even when the closures related to the pandemic are lots such as lots.

By understanding how customers could feel when they spend more time at home, Lowe’s and their rival Home Depot saw a significant duration of sales growth in the first days of the pandemic.

The directed marketing that includes the weak points of the audience can result in a massive elevator in its advertising investment return. In fact, 74% of customers report that they are more likely to continue with brands that feel they understand and provide relevant communications. This only happens when you learn more about your client.

Guide the development of your product

Finally, companies that understand customer preferences can use that information to improve their products and services. Smart companies take customer comments very seriously, either in the form of complaints or even recommendations for a product, service or new functions that can meet additional needs.

This may also be true when a product or service does not resonate with its customer base. In an interview with CNN, the former president of Nintendo or América, Reggie Fils-Aimé, is quick to notice that the failure of the company’s Wii U console was a direct taxpayer to the success of its follow-up: the Nintendo Switch.

In addition to making improvements in the design of the ITELF system, Fils-Aimé also referred to how the company learned the importance of providing a proposal of “crystalline” value to differentiate the console, as well as a constant flow of games. The lessons learned from what they previously resonated with customers have led the Nintendo Switch to sell more than 150 million units to date.

Whether it is refining an existing product or developing new offers that better meet market demands, knowing that your customer can boost the development of more innovative and customer -oriented products. This, in turn, will make your products more desirable to your target audience, creating greater sales potential.

Related: customers are changing, is your business ready?

Knowing your clients is a competitive advantage

Truly knowing your customers can provide a powerful competitive advantage in any industry. By using your knowledge of your customers to offer more personalized and higher quality experiences, adjust your marketing and even guide the development of products, you can build an ecosystem that increases the satisfaction and loyalty of the customer.

Remember, acquiring a new client can be five to 25 times more expectation than keeping your existing customers. With a greater knowledge of your customers, you can maintain your current base and boost more purchases, while acquiring new customers in a more profitable way.