Who are our customers? How did they get to know about us? Why did they buy from us? How can we find more just like them?

Marketing uses the answers to these questions to help direct product development, pricing, packaging and labels, distribution and your communications with potential customers.

• If your business is going well then create a customer profile using your best customers a role models. Use this profile to then attract more just like them.
• If your business is busy, but sales and profits are struggling then work out which customers are costing you time and money and which ones are profitable. When you know the difference you can direct your marketing towards the moneymakers.
• If you’ve reached a level, or sales are slipping then you need to get and keep more customers now. Research who’s buying products or services like yours – and how to get them to buy from you.

 What makes up a customer?

Market segmentation is the process of dividing your customer up into distinct groups that share similarities.

• Geographics: Segmenting customers by their physical location, towns, cities, counties, countries, post codes.
• Demographics: Segmenting customers based on things like age, sex, race, religion, marital status, education, income.
• Psychographics: Segmenting customers by lifestyles, behavioral patterns, values, attitudes.
• Geodemographics: This is a combination of all of the above, often called cluster marketing or lifestyle marketing, this is based on the idea that people who live in the same area share similar backgrounds, incomes, lifestyles and buying habits. Geodemographics helps you pinpoint these areas to target your marketing efforts.

Gathering information about your customers.

It stands to reason that people with the same profile as your current customers are ideal candidates to become new customers. So the best place to start is to know everything you can about the people who currently buy your products or services. Then we can focus our marketing efforts towards others who match that ideal customer profile.

• Collect address from invoices or shipping records and group them into localities. For examples, these could be geographic areas, or distances from your premises.
• Use a contest, with an entry form doubling up as a survey you’ll collect more information that’ll help you develop you ideal customer profile.
• Ask telephone callers how they found you and where they’re from. But keep it short, they called to receive information.
• Measure responses to advertisments and mailshots, include an offer or free samples in exchange for their address and other information.
• Observation, watch your customers, what kind of cars do they drive? How long do they spend with us? Do they arrive alone or with family members or friends? Do those arriving alone account for more sales than those accompanied?
• Survey your customers, if you have foot traffic work out where customers pause and be there to conduct a survey. Whether you survey all customers or perhaps every 10th customer, keep the questions short and spread the interviews over various days and times. Another method would be to use email or an online survey form.