How data-driven marketing can help you understand consumer behavior
In a competitive digital world filled with competent competitors, customer behavior analytics is essential. Furthermore, most marketing and advertising campaigns require precise data and analyses of customer behavior. Marketers throughout the world struggle with the challenge of influencing consumer behavior towards their product or service. Customers are at the center of the most successful businesses. Creative companies with rapid growth and high revenues are at the center of success. Customer Analytics is being employed by more companies today to better understand their customers and to capitalize on that data. Customer behavior data is used by companies as a part of their business. A customer-centric approach has proven to be very effective. There are many well-known brand names on Forbes’ list of 100 customer-centric companies, such as Apple, Amazon, and DHL. It is undoubtedly difficult to implement customer-centric strategies without a deeper understanding of customer behaviors. Associated with consumer behavior are the processes and activities involved when people search for, select, purchase, use, evaluate, and dispose of products and services to satisfy their needs and desires. In many cases, the purchase of a product or service is the result of a thorough information search, brand comparisons and evaluations, and other steps. In addition, Customer Analytics directly addresses the goal of reducing costs, increasing lifetime value, and making loyal customers effective brand advocates. Using customer behavior analytics has many benefits. In this article, we’ll explore what is driving behavior-driven strategies in today’s market and why they are so significant.
Consumer behavioral analysis is not always easy, but it gets easier as you devote more time to learning the reasons why people purchase a product or service. Understanding consumer behavior will allow you to gain a deeper understanding of buyer behavior. To get started, ask yourself the following questions:
- How do consumers decide whether to purchase the products?
- What makes them purchase this product?
- Is there a brand that consumers prefer over another, and if so, why?
Consumer behavior analysis plays an important role for marketers and how they communicate products and services to their consumers. You’ll get the necessary information you need to understand the motivations behind certain behavioral patterns.
There are four factors that influence buying behavior –
A psychological perspective – When it comes to consumer behavior, psychology plays an important role. Psychology, such as attitudes, motivations, personality traits, and beliefs, may be difficult to quantify, but they have a significant influence on shopping behavior.
Economic Factors – In addition to economic conditions, one’s purchasing behavior is also influenced by them. As an economy grows, the money supply rises, resulting in better purchasing power for customers. An economic slowdown can suggest a struggling market and fewer purchases. Consumer behavior can be influenced by factors like income, credit, and family income.
Personal Factors – Consumer behavior depends on a variety of personal factors, all of which are different from one individual to another. Examples include age, gender, occupation, race, socio-economic status, and cultural background.
Social Factors – As social beings, human beings interact with others all the time, which can influence their purchasing behavior. The social sphere can influence this behavior through the influence of friends, family, the physical environment, and the work or school environment.
The steps to understanding customer behavior:–
Organize customers based on segments – Segmenting your target audience into groups based on the characteristics that shape their shopping habits will allow you to obtain a more precise evaluation. Some of these factors are location, gender, age, educational attainment, and occupation. From all of these groups, we choose 2-3 most important ones – the most frequent purchasers and the most dollar-buyers. It can be accomplished by examining their frequency, value, and lifespan. Customers provide basic personal information on the brand’s website in order to receive a feedback form, this is a simple example of customer behavior analysis.
Analyze each segment’s unique selling points – You need to understand why your top consumer segments purchase your products after you have identified them. What drives their decisions? You must conduct qualitative research techniques such as user interviews in order to answer these questions, since you may not have access to these answers in your analytics.
It is also crucial to gain as much information as possible about how and why customers made their choices, and that can only be done by talking to them.
Is it more of an impulse purchase, or were they in need of an urgent solution that your product solved? Has your product been compared to any competitors? Do they think your pricing is fair? Identifying the unique selling points of your product will help you identify which consumers will most likely be attracted to each of them, enabling you to then customize and tailor your marketing strategy accordingly.
Conduct a quantitative analysis of customer behavior based on predictive analytics – Using the previous two stages, businesses can collect qualitative information about their customers – what they think and how they base their decisions; however, for objective analysis, numbers are required to support your claims.
In addition to analyzing your website visits and views, social media activity, conversion reports, and favorite products, the most transparent and easy way to get numeric data is to analyze your website visits and views and social media activity. To allocate and convert this information into visual reports, you can use big data and machine learning tools.
Analyze your quantitative and qualitative data – Comparing qualitative and quantitative data is the next step after collecting your data. To do this, refer to the data sets when creating your customer journey map. Examine which persona purchased which products, when and where they did so. Was their visit repeated? You can examine both sets of data in relation to the customer experience to understand your customers’ journey in detail.
By comparing the data to the customer journey, some recurring trends should be apparent. Note any unique behavior that is specific to a type of customer and common roadblocks that appear at different lifecycle stages. Remember to acknowledge any trend you see in the buying behavior of your high-value customers.
Make Changes Accordingly – You should almost certainly see changes and optimizations suggested by the results of your analysis in step four, so now is the time to put them into practice! Your marketing plan should be directly affected by the insights you’ve learned. Consider a segment of customers that exhibits high loyalty, they use Instagram heavily, they come from third-party review sites, etc. The information you collected on their demographic could be used to develop an Instagram branding campaign that emphasizes the key benefit of your third-party reviews. Optimizing the copy on the most popular pages can also help your marketing efforts.
It’s just an example, of course. If your analysis indicates that you need to target certain user segments at specific times with ads and content tailored to them, you may decide to utilize predictive analytics.
Re-analyze your findings and repeat – An analysis of customer behavior should always be followed by further analysis! This should not be viewed as a one-time event, but as a continuous process of optimization over time. What’s the reason? Markets and consumers change constantly, regardless of how much you change your product. Having a deep understanding of consumer behavior will help you generate great optimizations now, although there are many factors that affect consumer behavior, including social trends, competitor marketing, and economic factors.
Keep in regular contact with your customers and their preferences through qualitative and quantitative customer behavior analytics. This is the only way to ensure you truly know them.
Conclusion
Managers can gather long-term information about the average purchase value of customers, the average lifetime value for each customer segment, and their needs by conducting customer behavior analysis.
A lot of marketing, development and scaling can be made easier with smart data and insights. Your expertise gives you insight into which niches to explore, how to attract customers, and how to enhance functions.
The last reason is that AI and machine learning speed up the process – you can receive reports on customer behavior within minutes, and you can monitor your audience’s growth in real-time.
Our e-commerce team is familiar with common customer behavior patterns and knows when and where to start the analysis.
We can help you understand your customers’ behavioural patterns and thought processes, and generate actionable insights.
