Your biggest purchasers and most vocal brand advocates play a huge role in growing your customer base, so it makes sense to try to attract as many of these ideal customers as possible. Here are some tips to get the ball rolling.
Who Are Your Highest-Value Customers?
Sales isn’t the only metric that matters when it comes to defining your “best” customers. You also want to know which customers are your biggest brand advocates. These individuals might be indirectly driving more sales than they themselves are making with your store.
Chances are you can already think of a few customers who unabashedly love your brand and want to tell everyone about it. Brands need customer advocates to gain (and maintain) visibility—especially smaller businesses looking to establish a core audience.
But what kind of value does social engagement provide your brand, and how important is it that you grow your base of brand advocates? Social analytics tools can help you identify your most engaged—and thus most valuable—followers on each social channel.
Marketing engagement can also help identify good customers to focus on. Who has the highest open rate for your emails? Who clicks through the most, and for what types of content? You may be able to spur these customers to action through an engaging campaign.
Of course, looking at sales data by customer is the most common way to identify your best customers. Data points that can indicate high customer value include:
- Average order value per customer
- Lifetime value
- Purchase history (by SKU or category)
- Store visit frequency (in-store, online, and/or both)
- Average units per transaction
If you use Lightspeed, many of these sales-based data points can be found through Lightspeed’s analytics dashboard. If you use Springboard, you can even see customer return rate, units per transaction, and profitability right on the customer record or through reports.
Customers who buy gift cards are also good bets. Few people buy gift cards for themselves; they buy them for their friends and family. They are so sure that others will love your brand, they’re willing to pay for them to experience it for themselves. Consider targeting anyone who has purchased a gift card for your store: They’re probably already telling their friends all about your brand.
The Upside Down
Building stronger relationships with your current customers is almost always easier than getting new customers, so be sure to look for lagging customer traits that create opportunity.
For instance, a customer who hasn’t shopped in nine months might be ripe for a discount offer or promotion. Meanwhile, customers with abandoned online carts may simply need more information about the products they are interested in. Try following up with more details and/or looks that feature the abandoned items.
Another opportunity to pursue is customers with high return rates. They may have sizing issues or other concerns. Showing them an online prompt to answer sizing questions or encouraging them to come in-store for a fitting might make all the difference in converting them into happy customers (with fewer returns).
A loyalty program can also be an effective way to encourage existing customers to engage and spend more.
Creating Customer Segments or Personas
Once you’ve established your best customers and some goals, you need to come up with strategies to attract more of those individuals. This process starts by identifying shared attributes among your customers.
These attributes could span a number of data points. You might find that your top sales per customer are coming from shoppers who all live in the same area, or that customers who buy in certain categories shop more frequently.
Although it is important to keep in mind that these trends are only correlations, they can provide a starting point for targeting new customers that become top-spending, high-engagement customers.
Based on their findings, most businesses find it helpful to create 3-4 broad customer segments that can be further curated or even overlap—for instance, organized by average spend per transaction or purchase frequency. Choose the criteria for each segment based on your goals, and don’t be afraid to leave some customers out.
Once segments are organized, you can then target each one separately with specific content or offers. By grouping and organizing in this way, you will have a better way to gauge the effectiveness of your campaigns.
Personas are another helpful, strategic way to organize your customers. Personas usually have names and backstories complete with demographic info, motivations, and personality. Essentially, a persona is a customer “type.”
For example, “Stacey” makes $40,000-$60,000, is married with no kids, and visits the store once per month. Because she likes to shop, she is more likely to buy more items at once to style a room or an outfit. You can use customer data to gradually develop these personas and assign them to your customers as a way to get your teams thinking about “what a customer like Stacey might like.”
Create and Attract More High-Value Customers
With your relevant data points in hand and your segments or personas, you can start to build marketing campaigns that specifically target new “best” customers. You can also better connect with existing customers to encourage them to act more like your best customers.
If you haven’t done a ton of marketing, we recommend starting with email campaigns and social posts that “speak to” your current customers with calls to action, such as new products or discounts. See what the response is. Is it working? If so, consider setting up a schedule of regular marketing campaigns to get some momentum.
Online advertising via Facebook and Instagram can be a great complement to other channels, allowing you to very specifically target new customer audiences. Advertising can be incredibly expensive, though, so make sure you are targeting the right audience, and run some modest tests before you set a budget and commit.
Direct mail and catalogs have been surprisingly effective for some brands. Some vendors include data services and will actually analyze your current best customers, fill in demographics on them, and then send mail to similar potential customers.
Figuring out how to identify and target your best customers is easier said than done. It can involve a lot of trial and error because you’re testing hypotheses about where your top-value customers are coming from. Don’t get discouraged if you don’t get the results you want right away—stay persistent and creative, and over time, you’ll learn the best ways to connect with your customers and turn them into loyal fans.