Know-your-customer or KYC is the practice of collecting data about your customer base for a variety of purposes beneficial to your business. Know-your-customer should be implemented as a company-wide policy and be considered in every decision you make, but at a basic level, KYC has two primary functions: marketing and security. Today we will be talking about KYC in Marketing. Visit the DalPay Blog in the coming weeks for our article on KYC in Security.
Knowing and understanding your targeted customers is the key overarching factor in how well your company is going to distinguish itself from its competitors. It’s business 101 to know who your target audience is and how to sell to them, but it’s how well you know them that can set you apart. Accurately predicting the needs and desires of your clientele builds trust among existing customers and can convert new ones from your competitors.
When it comes down to it, KYC is common sense. Even the least aggressive marketing departments are at a minimum aware of who is buying and utilising their products. The beauty of online business is that it’s easy to collect and track information from your customers –zip code, age, gender, language, time zone and more. The part that distinguishes you from your competitors however is not the information you gather, but what insights you are able to glean from that information.
Step 1: Who is Your Audience?
The first step to knowing your customer is to identify who your audience is. You need to have a pretty solid grasp on both what type of people are looking at your website, what type of people you want to be looking at your website and, most importantly, whether there is a disparity. If there is a disconnect between your targeted audience and your actual audience, you need to identify why and adapt your tactics in order to more effectively target one or the other.
For example, if you are selling products targeted at a specific income bracket but most of your visitors fall into a lower income bracket, you have two options:
- You can try to identify what it is about your marketing that is attracting the lower income bracket and adapt it to seem more attractive to your intended audience; or,
- You can adapt your product to better suit the lower-income audience which it is already attracting.
Income is just one of many factors to use in identifying your audience, you also need to look at their age, gender, geographic location, language, etc. Once you have gathered enough basic information, you can begin to develop visitor profiles.
Step 2: Develop Visitor Profiles
Using information gathered from visitors, usually through the use of analytics software, you can develop visitor profiles. By looking holistically at the information provided by both real and potential customers, you can start to identify trends both in overall demographics and in specific niche interests that can be determined by:
- The spending habits of the customer
- The customer‘s shopping list
- Wish lists on various occasions
- Customer lifestyle as reflected by their profile
For example, whether they’re visiting your site on a computer or on a mobile device can suggest some things about the customer’s spending habits and lifestyle. Mobile shoppers tend to make more purchases, since they are willing to shop on the go, but also show more loyalty to their retailers, perhaps due to security concerns involved in m-commerce, so these can be valuable customers to target.
Step 3: Tailor Your Marketing Accordingly
The first two steps are just the foundation of the KYC approach to marketing, while the third step is where great marketers distinguish themselves from the sub-par. Once you have a grasp on who is visiting your site, how frequently, what they’re doing and what device they’re using, you need to interpret that information creatively to inform your marketing and advertising strategies.
Begin by breaking your audience into segments, both behaviourally and situationally. Unless you’re selling an ultra-niche item, you’re bound to have several different types of customers attracted to your business for different reasons. Behavioural differences such as the device they use to browse, what they view, what they buy and what time of the day they visit the site can inform where and when your marketing can be effective.
Also, certain segments of your user base might be affected by different circumstantial factors; for example, if you have significantly more repeat customers in your full site as opposed to your mobile site, maybe your mobile site is not ideal and is turning away potential customers. It’s important to be inclusive in your marketing strategies and to tailor different features and campaigns to these distinct groups. You can gather some more specific information about your customers with tools such as:
- Customer Relationship Management (CRM) software; which can help you compile a list of current and past customers, including contact titles, locations, industries, company names, purchase histories, etc.
- Lead scoring; where you score each of your visitors or sales prospects based upon their profile in order to estimate the likelihood of conversion.
- Encouraging your visitors to link their social media profiles to your website or app; if they do so, they will voluntarily provide you with significantly more information about their demographics and interests.
In contemporary e- and m-commerce, visitor profiles are more important than ever. Have you ever received a marketing email that opens with “Dear Client” or “Dear Customer”? I don’t know about you, but it makes me cringe every time. Despite the fact that more people than ever are shopping online (or perhaps because of that fact) shoppers really want a personalized experience – and because we can’t meet most of our customers face to face, we need to utilise visitor profiles in order to provide that experience.
By analysing how demographics such as age, gender and location correlate to bounce rates, returning visitors and conversions, you can see just which segments of your audience you’re reaching successfully and which segments you’re losing. Like all businesses, your customer base is diverse and not all marketing strategies are going to engage everyone, so you shouldn’t be treating all your customers the same way. They need to feel like the experience you’re providing is geared specifically to their needs, desires and interests. The more you know your customer, the more personal the customer experience you can provide and the happier they will leave.
And if that sounds like a lot of work for one customer, then you’re forgetting that in the age of social media, a happy customer is a brand ambassador. They may only make sporadic purchases, but they’ll share they good experience online to who knows how many Facebook friends and Twitter followers. Considering the number of potential future customers that could generate, you can never underestimate the value of knowing your customer.