How well do you know your customers?

Article from January, 4th, 2004

Consider any business. A coffee shop, for example. Why do some go out of business, while others thrive? Maybe it's the location or the atmosphere or the product they serve. These are all important factors. But the true key to a successful business is the customers. Bad business has none. A prospering business has many. But are these customers the same? Of course not. Some people stop by occasionally for a shot of espresso. They may or may not make up the core of the audience. Some people probably come for the atmosphere. There will be a few folks who stop by only to buy coffee beans. Finally, maybe this imaginary coffee shop has the best hot apple cider in town or exclusive Italian pastries. Why does all this matter? Because knowing your customers is the key to any online or offline business.
Too many businesses make the same mistake - they try to attract as many people as they can and then turn them into happy money-spending customers. Sorry, it just does not work this way.

First, you have to know who your customers are and then target other people like them. Forget about the rest.

When it comes to online business, including e-mail marketing, metrics becomes increasingly important. Click-through rate, ROI, customer acquisition costs, and other "indexes" are all about "macroactions." But there are a lot of "microactions" that take place. First, the person receives an e-mail. He or she looks at the Subject line and who it is from. Then a person decides whether to open or delete it. A recipient may read the first couple of lines or the entire message. Some re-read it several times, weeks after the message has arrived. Importantly, some people click the hyperlinks inside the message, while others type in domain names manually when the go online next time. The other "insignificant" information, like what pages your buyers visit most often and how much time they spend at the website vs. non-buyers can be very important, because it is "microactions" that influence "macroaction". It is very important to gather and analyze this information. You may discover truly remarkable things. For example, people who opt to subscribe to newsletters generally make more purchases and prefer more expensive items. So if people who prefer getting information from their mailboxes are different from folks who like getting online and browsing the website, why treat them the same? Surprisingly, in some instances, offering less choices translated into higher sales. How well do you know your customers.

See also:

    • Mailing lists and e-mail address verifier
    • Find new customers in the newsgroups

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Prev week: E-mail marketing for small businesses

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