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When you want to know more about someone or something, the first step is always to research them. You’ll then create a portfolio or a report with all the relevant information obtained on the particular subject.
Similarly, businesses can research their customers and use the insights gained through customer profiling to make their products or services more marketable.
By understanding your customers’ needs, it is possible to meet their expectations. This approach not only helps you identify who your customers are, but it also reveals their motivations and driving factors.
In this blog, we’ll discuss how customer profiling can help businesses connect with their customers better.
What is a customer profile?
A customer profile is a document containing all the relevant information about your customers. The data gained from this document is used to drive marketing for your products and tailor your services to meet customer needs and expectations.
B2B vs. B2C customer profiles
Despite being different types of businesses, B2B and B2C organizations both gain a lot from using customer profiles. The type of information collected will be different for each, depending on the type of customer profiled. Let’s examine each independently.
- B2B customer profile: A profile done on businesses that form part of your market. It describes the industry, shareholders, business size, location, and the decision-making process.
- B2C customer profile: Focuses mainly on the customers themselves. demographics, purchasing patterns, psychographics, and pain points.
Note: Collecting customer information is subject to the customer’s consent and must be in accordance with company and regional laws and regulations.
What is customer profiling?
Customer profiling is a strategy used to create customer profiles that describe an organization’s ideal customer. It is used to categorize customers based on their qualities to ensure they receive the best possible products or services.
It’s an approach that aims to create personalized experiences, making every interaction memorable.
Customer profiling vs segmentation
Customer segmentation involves separating a customer base into groups based on shared characteristics.
Segmentation aims to target different types of customers from a larger base to create a marketing approach focused on each segment.
However, it does not provide extensive information compared to customer profiling, which focuses on customer personalities more extensively.
In comparison, businesses use both to develop a personalized market approach, making their products valuable in the process.
Types of customer profiling
The focus may be on different aspects of the customer behavior or patterns, but they all provide essential data that makes customer profiling vital for any business.
The following are components of customer profiling:
- Demographics: This answers the question ‘Who.’ A Statista study shows that 86% of top marketing executives worldwide consider demographics the most important data to collect. Information collected include age, gender, level of education, marital status, income, race, among others.
- Psychographics: Psychographic data answers the question ‘Why.’ The answers explain why customers decide to buy or use your products and services or the reason behind their behavior. Data collected include attitude, interests, lifestyles, habits, goals, etc.
- Behavioral: The behavioral data in customer profiling answers the question ‘How.’ It shows the way a customer interacts with a brand. It can be in the form of purchasing patterns, brand engagement, buying history, and interactions.
- Geographic: This form of customer profiling is meant to answer the question of ‘Where.’ that is, the location customers interact with your brand. Data collected include country, area, language spoken, current location, and any other relevant geographical data.
Advantages of customer profiling
Collecting customer data and transforming it into valuable insights through customer profiling is the perfect way to learn more about your customers.
Every business aims to be profitable and standout in their industry by creating positive customer relationships.
Let’s look at some of the advantages that come with customer profiling.
Provision of better personalized support
A customer profile provides all the information about your ideal customers, meaning a business can easily provide personalized customer service.
Agents will also easily make data-driven decisions and work to improve the relationship between customers and the organization.
To enhance the customer service, it is important to obtain customer feedback through surveys, interviews, feedback forms, net promoter scores, social media, etc.
Improves workflow efficiency
Information on customer profiles can be shared across different departments in an organization. For example, this data can range from customer-facing to non-customer-facing concerns.
A customer profile will integrate all the data into one document, thereby breaking silos and improving agent productivity.
Teams from different departments such as customer support, testing, development, and sales can collaborate, exchange knowledge, and learn from each other, thus promoting innovation.
Customer loyalty
When a business uses a customer profile to make their agents more productive, it increases customer loyalty rates. A customer profile makes it easier to provide proactive customer service that reduces customer churn and increases repeat buyers.
Reduced customer acquisition costs (CAC)
Customer acquisition cost is the amount of money an organization spends marketing its products or services.
Customer profiling is a strategy in marketing that uses a targeted system to meet the values shared by different types of customers.
Creating customer profiles makes it possible to identify potential buyers and focus resources on attracting them.
With this approach, a business will spend less on customer acquisition costs and focus more on finding customers organically.
How to create a customer profile: A step-by-step guide
Customer profiling can be challenging, especially if you don’t know where to start. This is the time to utilize your customer’s characteristics, meaning the information to be collected must be broad and highly informative.
To make it simpler for you, the following are some steps you can use to create an effective customer profile.
Utilize customer profile templates
Pick an already written and customizable template that’s ideal for your customer profile and fill it out appropriately. The prewritten template saves you the trouble of creating a customer profile manually, which can be tiresome and time consuming.
It can be adjusted easily to include all the customer data without making compromises. It is highly organized, detailed, and maintains uniformity for all customers.
Obtain customer information
Information is the pillar for learning, making decisions, and improving. It is even more crucial when marketing your product or service. That’s why you need to collect relevant customer information, starting from the demographics, to identify similar customer behaviors.
Demographic information to be collected includes:
- Location
- Age
- Gender
- Race
- Level of income
- Occupation
- Marital status
- Level of education
From the collected information, similar customer behaviors, including customer motivation and buying patterns, can be identified. This information will guide you in serving your customers better, offering better services, and attracting more customers.
Gather customer feedback
Customer feedback is an excellent way to engage with customers and gather personalized insights that might not be possible through standard data collection.
This feedback creates a complete picture of who your customers are.
Customer feedback and reviews allow you to gain valuable suggestions directly from them, helping you improve your products and services.
Collecting feedback is not a difficult task and can be done through:
- Interviews
- Feedback forms
- Social media reviews
- Indicators such as customer satisfaction score (CSAT), customer effort score (CES), net promoter score
Research your competition
By analyzing your competition’s strategies, strengths, and weaknesses, you can obtain information that will make your brand stand out. This research also analyzes customer perception of your brand in comparison to competitors.
Understanding these perceptions can highlight areas where your brand can improve, ultimately attracting more customers.
Knowing your distinguishing features lets you develop a personalized brand identity that resonates with your target audience.
Understand the solutions created by your product or service
To succeed, you need to know the problems your product or service solves. This requires market research to identify your customers’ main challenges and how your product can help.
Focus on areas like:
- The market
- Customer pain points
- Why customers choose your product
- The specific niche you target
This research will give you a clear picture of how your product provides solutions and works for your customers.
Create your customer profile
With everything in place, fill in the customer profile, ensuring the data is accurate and updated consistently.
Invest in a customer relationship management tool that will help you collect customer data, organize contacts, contact groups, and track all interactions.
This is beneficial because the information received will always be up to date. In case of new trends, you can update the profiles easily and adjust to meet the new expectations and demands.
Tools used to create customer profiles
With the rapid evolution of technology, creating customer profiles manually is no longer an option.
This is because of the availability of different customer profiling software that will not only streamline the process of data collection but also help in efficient management of customer data as it is received.
Contact management
This is a key part of customer relationship management (CRM) that stores all customer data in one central location for easy access and analysis.
The custom fields feature allows businesses to store extra information as needed by either adding or removing it. You can also segment your data, use automation to customize workflows, and set up actions to simplify monitoring.
For each segment, you can set service level agreements (SLAs), tag, and filter contacts based on their characteristics.
This helps companies organize contacts and contact groups so they can easily track and monitor customer interactions.
Customer profiling analytics tools
Businesses use these tools to measure, track and provide data on customer engagement within your website, making it possible to discover areas requiring growth. An example of this is Google Analytics.
Most help desk software has a reports and analytics feature that measures and analyzes customer data, reflecting on your customer service performance.
This provides valuable insight to make informed decisions and to boost levels of customer engagement.
Analytics tools track important customer engagement metrics such as:
- Churn rate
- Conversion rate
- Email engagement rate
- Social media engagement
Communication tools
Communication platforms such as social media, email, Slack, WhatsApp, etc., contain records of how customers engage with your brand. This information helps executives make result-oriented decisions that propel your business.
An omnichannel inbox feature integrates all these communication platforms into a unified inbox allowing customers and agents to use any communication platform without losing the context of the conversations.
Feedback forms
Consider using forms to learn more about your customers firsthand. Feedback forms allow them to share their experiences, challenges, needs, and expectations of a product or service.
The alternative to a form is survey. It can be tailored based on the information required from customers, enhancing accuracy and freedom to share thoughts and ideas.
Customer profiling templates for businesses
Customer profile templates are easy to use and have reduced the time needed to create one from scratch.
These are some of the important sections you’ll find in a customer profile:
- A basic customer profile template captures simple and basic information about your customers. It’s usually a short take, about one page only.
- An extensive customer profile template offers a lot of client information, so there will be many blank spaces meant to be filled with comprehensive customer details. This is common when offering B2B customer service that requires a lot of information, such as business sector, size, location, etc.
- Profile template for customer abilities is a compilation of data based on a customer’s skills, abilities, area of expertise, education, work history, certifications, etc. With this data, an organization can match customers to jobs based on their abilities.
- A profile on customer interests contains customer information based on their interests, such as their preferred activities, hobbies, sports, etc. The information is then used to target marketing campaigns based on common consumer interests.
Customer profiling examples for success
The first step to successfully implement your marketing strategy is to effectively conduct customer profiling. The following are some examples of already-filled-out customer profiles that offer a guide on how to tailor yours.
Personal information customer profile
This is a basic customer profile containing only the basic customer information that is demographics, customer pain points, purchasing patterns and history, preferred communication channels, etc.
Customer scorecard profile
The scorecard is a means of assessing and measuring your customers using a standardized scoring system to identify whether the customer meets set criteria.
The results will inform whether the customer matches or surpasses your base standard for an ideal customer.
Leverage customer profiling to grow your business
To be successful in marketing, you must conduct thorough research to guide your decision-making process and realize the most valuable strategies. Customer profiles provide valuable insights on your target, helping you understand their needs and preferences better. It leads to improved sales, customer trust, loyalty, and brand reputation.
Your business can stand out when compared to competitors when customers’ needs and expectations are met. This is only possible if you have the right tools such as BoldDesk®.
Explore how we can help you profile customers with ease by booking a live demo or start a 15-day free trial. Contact our support team if you have concerns anytime.
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Frequently Asked Questions (FAQs)
- Why should you conduct customer profiling?
The goal is to gather the right customer information for marketing, so you can provide personalized products and services that customers want, leading to the best return on investment (ROI) for customer service.
- What are the methods of customer profiling?
Customers are divided based on different characteristics, such as their purchasing patterns and personalities, among others. The methods include:
- Typology method
- Consumer characteristics
- Psychographic method
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