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Why You Absolutely Need to Start Using Customer Data (and 4 clever ways to do so)


April 28, 2023

Do you have a home assistant? I'm not talking about an Alfred to your Bruce Wayne. No, I mean like Siri, Alexa, or Google Home. Have you traded your privacy for convenience? Many of your customers likely have, and if that's the case, their consumer expectations are changing rapidly. If you're not keeping up with them in your business, you'll miss out.

What's Changing for Consumers?

Most of us are coming to expect the following things in our interactions with the people we buy from:

  • Ease. We're becoming accustomed to assistants responding to our voices. We can purchase something just by telling our AI to do it. We can find out answers just by speaking to them. Convenience is an expectation.
  • Collections. Since businesses are collecting our data, they're now starting to give the information back to us in year-end summaries. These types of data feeds and compilations are becoming the norm.
  • Auto ordering. Businesses are now enabling us to receive automatic shipments based on the timetable we stipulate.
  • Suggestions. The customer has to do less thinking now because companies are making suggestions (for purchases) based on prior purchasing history.
  • Completion prompts. No longer is the customer left wondering if they've done everything they're supposed to do. Most companies now provide visual completion prompts of activities in a series. This is often used in onboarding situations as a checklist or status bar marking progress toward a goal.

These technological changes are influencing customer expectations at all levels. While your customers may understand your business needs more money than a big box store like Target, they still expect certain levels of attention and personalization.

With today's affordable customer management software (CMS), you can track the basics of a customer's interaction with your business. In addition, most email marketing software now incorporates customization for your emails based on data or "if, then" scenarios.

If you start doing more with data, you must begin collecting it and building a customer database. Here are 7 easy ways to get people to identify as a customer and start building your list.

  1. Offer discounts and coupons for joining your list.
  2. Offer early access or notification on sales or specials.
  3. Create a newsletter that provides information of value to your customers and potential customers.
  4. Keep a sign-up at your brick-and-mortar store or business location.
  5. Prompt people visiting your website to become part of your list.
  6. Enable online shopping with a sign-in/customer account.
  7. Offer something of value in exchange for an email.

These ideas are just a start to begin to build your list. After you do so, you want to enable your CMS to track past purchases and activity. This is a great way to begin sorting your most loyal customers from everyone else. Next, you want to use this information to tailor your marketing to these people. Personalizing your offerings will make people more likely to buy from you.

Most sales trainers will tell you it's easier to get someone who's already purchased from you to buy again than it is to win over a sale for the first time.

Once you have the data, you want to use it. You can use the data and past purchase history in the following ways:

Use What They Bought

Assuming you're tracking it (and you should be!), you know what your customer has purchased. Therefore, giving them a personalized offer is more likely to yield a positive response. This is especially true of products and services people need to use more frequently.

Recently, I received a very clever marketing email from Southwest Airlines. They used information about a past trip I took and married it with a reduced fare they're offering. This sale fare offer was not exclusive to me. They're offering it to everyone, but they know I traveled that route about six weeks ago, and they're taking a chance that I might be interested in traveling it again.

This is highly effective marketing because I may consider buying a ticket if I have a friend or family on that route. After all, it's a good deal. I wasn't even in the market for a ticket, but how do you pass up a good deal on a past route?

This will only work for some as the trip may have been a single trip and not one to take a second time. But it's worth calling the travelers' attention to it. You can do the same for past purchases and discounts in your own business.


Complementary Items or Services

There are some things we all need. You may gain good insights into those if you look at your data. For instance, if you own a toy shop and someone purchased a battery hog of a toy from you online, you can send them an email thanking them for their purchase and asking them if they need any batteries, headphones, or other complementary items for their past order. Of course, you can make these emails funny, but you always want to include a link to the item you're offering.

Providing the link makes it extremely easy for them to order as they don't have to type in your site, do a search, find the item, and check out. Instead, they open your email and think they've meant to order one of your suggestions and click on your link.

You get another sale that costs you very little, and your customer meets their needs from the comfort of their home or office.


Future Suggestions

You can use past activity history to make suggestions to people on what they might want to do in the future. For instance, if you are a travel agent and someone booked a Caribbean cruise with you one year, you know they're interested in cruising. It's also likely; they may want to try a different location. So you can email them some suggestions along with the specials you're running.

"We Miss You" Deals

As part of tracking past purchase history, you're also following the dates of purchases. For example, when a customer hasn't purchased from you in a while, you may send them a special discount that expires in a week. That way, if they were thinking about returning to shop with you or using one of your services, they now have an even bigger reason to do so. This is particularly effective in salon and beauty services.

Using past purchase history and personalization can be a very effective way to increase sales. Except for the initial investment in the software that helps you collect and manage customer data, there's a minimal cost to you (outside time) in offering these types of hyper-personalized deals and sales. In addition, since the customer has done business with you before, offering these incentives will likely get their attention.

But as you're building your list and tracking purchase data, remember the importance of asking permission to market to them. Never add someone to your marketing emails without their consent. It's easy to be clear about what they're signing up for. If someone's buying something from you online, you can make it an easy checkbox and give them options of what kind of communication they want to receive from you.

Always get permission. Please don't assume that they also want marketing emails from you because they buy from you. Some people don't, and that's okay. But to avoid breaking spam laws, you want to ensure they agree to it first.

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