What are Customer Profiling and its Undeniable Benefits to Business?

Aug 10, 2021

advantages of market basket analysis

Customers are the lifeline of all businesses and attracting and retaining them is one of the most crucial tasks businesses face, failure to do which can ultimately lead to their downfall. Therefore, improving their experience is the prime concern for businesses.

What is Customer Profiling?

To improve customer experience, knowing the customers is very crucial. Customer profiling enables us to do so. Customer profiling is the process of segmenting customers into different clusters on the basis of common traits and characteristics. Customer profiling enables businesses to target and engage with their customers better by determining a clear set of messages and imagery for specific customer segments. The result is enhanced customer experience, optimized retention and loyalty, and a more efficient marketing strategy.

The marketplace today is immensely competitive with businesses competing for customer acquisition, market share, and customer retention.  Therefore, for businesses to find more customers and to enhance customer loyalty, targeting the appropriate prospects with the appropriate offering at the appropriate time is very essential.

But how can businesses identify the right prospects and how do they offer a service that makes the customer feel cared for, valued, and engaged? The answer is simple: Build an effective customer profile!

Request a free proposal now to gain comprehensive insights on the business benefits of customer profiling.

Every business should implement the exercise of designing a customer profiling template. In marketing, knowing your customers helps companies to improve personalization with existing ones and find new ones. However, apart from better insights, there are several other benefits of customer profiling that every business must know to achieve stability and success in the market. Here is a list of a few benefits of customer profiling.

Benefits of Customer Profiling

The advantages of customer profiling are not limited to an optimized marketing organization. Customer profiling helps businesses optimize their end-to-end processes. Some of the advantages of customer profiling are listed below.

1. Target Relevant Audiences

This is one of the most significant benefits of customer profiling. Customer profiling provides businesses the ability to tailor communications based on the specific interests of the customer. This, as a result, will enhance engagement, experience, and ultimately improve sales.

2. Enhance Response Rates

The customer profile helps businesses in communicating with the right people at the right time. This drives better results from campaigns and sales. This insight also initiates a nurturing process to lead the potential prospects through the buying process. These are multi-layered benefits of customer profiling when it comes to boosting response rates.

3. Optimize Customer Acquisition

A customer profile helps you understand your best customers, and this, in turn, can help you to look for prospects with the same characteristics. These prospects can turn out to be potential customers. Such customers will always have a higher propensity to be interested in your service and offering.

4. Data-Driven Market Expansion Plans

An accurate customer profile enables organizations to understand their current market penetration, project market potential, and gauge untapped revenues. This data, in turn, enables them to chart out data-driven market expansion plans to substantially improve their customer footprint and market share. This is one of the most important benefits of customer profiling as it opens up the door for future growth and stability.

Quantzig’s analytics experts can help you leverage advanced statistical algorithms to design the best customer profiling strategy for your business. Request a free demo to get started.

5. Improve Operational Efficiency

Accurate customer profiling enables businesses to better forecast demands, optimize sourcing and manufacturing, and pre-empt bottlenecks. Customer profiling also enables organizations to optimize reverse logistics by better predicting, preventing, and responding instantaneously to customer issues.

6. Enable Account-Based Marketing

The future of marketing is unequivocally tied to personalization. While gathering information on individual customers to personalize content and offers for them is a tedious task, profiling them into clusters makes it easier. Customer profiling enables organizations to create account-based marketing strategies in real-time that optimize marketing spends, enhance MROI, and drive conversions. Data-driven customer profiling also enables real-time tweaking of plans to better meet the needs and expectations of customers.

7. Drive Brand Loyalty and Profitability

By better profiling their customers, a business can easily understand their likes and dislikes, goals and motives, and the right time and forum to connect with them. Solving a customer’s problem right when they are looking for a solution enables organizations to optimize their brand image and improve customer loyalty. This, in turn, leads to higher conversions, reduced marketing spends, increased MROI, and overall higher profitability.

We, at Quantzig, have designed the following customer profile template as an example to help you understand how to structure a customer profile.

The Process of Customer Profiling

1. Identify Your Best Customers

Identify customers getting the most value from your offerings and list down their important attributes (demographic, psychographic, socio-economic, geographic, work profile, etc.). This information will enable you to create the ideal customer profile.

2. Survey Customers

When listing down attributes of your customers, you will realize that you have more information about some customers than others. Fill those gaps by conducting surveys. The survey must contain all important questions to gather information on missing attributes.

3. Extract Data from Online Channels

Data is everywhere. Extract data from all your online marketing campaigns and channels to know more about your customers. Common channels to extract data from are email, website, social media.

4. Create a Customer Profile Template

Create a consistent customer profile template and add all customer details. The key is to not complicate it too much. It is also important to document and store all customer profiles in one place for ease of access and the creation of a historical database.

5. Update Regularly

Conduct regular surveys to capture changing customer preferences and interests will enable you to keep your customer profiles up-to-date.

The Ideal Customer Profile Template

  1. Customer’s personal information
  2. Customer’s location
  3. Customer’s demography
  4. Customer’s buying pattern
  5. Customer’s behavior
  6. Customer’s interests and preferences
  7. Customer’s job profile


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