How to do customer analysis in 8 steps
If your customer analysis is going to be effective, then it needs to be thorough. It's important that you gather the proper information and then apply it in the most meaningful way. The process can be outlined in eight broad steps:
1. Analyze your current customers
If you have a good analytics system in place, then you've already have a lot of data on how your customers behave. While market research looking outside of your customer base can help, looking at the people who have already purchased accomplishes the dual purpose of giving you specific access to how your product is used and providing you with information on the exact type of people likely to purchase from you.
2. Perform customer profitability analysis to identify the most valuable customers
Your entire customer base can give you plenty of good insights about which features are popular and similar generic metrics. But in order to know which types of customers to reach out to and which improvements are going to make the biggest impact on churn reduction, it pays to look at the type of people who have spent the most and/or stayed with you the longest. Keeping those customers happy and bringing in more like them will give you the most growth.
3. Perform customer needs analysis to discover the main purchase drivers
People make purchases based on needs. When you understand what your customers (and people similar to them) need from a product, you'll also understand what drives them to make a purchase. This data will play a big role in shaping the future development of your product and help you stay a step ahead of the competition.
4. Perform customer segmentation analysis to create customer segments
Customers can be segmented in a variety of ways. You can divide them by common demographic traits, common profitability metrics, common shopping or app-usage behaviors, and more. The data itself and customer segmentation tools will help guide you by grouping your customers into logical segmentation buckets. The data will help you determine your most profitable customers for the step above, but also show you which are in danger of churning, so you can take steps to avoid it.
5. Use customer data to create buyer personas
Armed with the customer segmentation data, the next step is to get to work crafting a fictional version of the major segments. These buyer personas will serve as the fictional embodiment of your customers, so the marketing, sales, and onboarding teams can communicate with them in a way they'll be most responsive to.
6. Acquire customer feedback
Analytics are a big driver of how you understand your customers, but they alone can't tell you everything. The best way to know what customers think is still the old-fashioned way of asking them. Getting routine customer feedback will keep you stay up-to-date on how customers feel about your product versus an ever-changing technological and competitive landscape.
7. Draw a customer journey map
Drawing a map of your current customer journey and comparing it with the feedback they've given and data you collected can help you identify points in the journey that are not currently being adequately addressed.
The technological landscape is constantly changing. What was state-of-the-art and adored by customers one day can be old news the next. It's important to keep that in mind and ensure that customer analysis is an ongoing effort on your part, and not something you do once and forget about.