Advertising, Marketing & PR

Identify Your Customers

Customers and potential customers

The purpose of marketing is to reach more people and convince them to buy. Analysing your business, to really crystallise what you offer and how to communicate it, is the first step. Analysing your customers, so you know how to pitch to them and where to advertise to reach them is the second. If you have already analysed your customers through the suggestions in our Raising Quality section, you can use this analysis now. Otherwise, read on. This analysis can take anywhere from 30 minutes to two hours depending on how readily accessible your customer records are and how deeply you want to go...

A two-stage process

When looking at your customers your first step is to see who you are already selling to (especially the ones you are making repeat business to). The second step is to see who you are missing that could be well suited to your products and services.

Put your customers into categories

Sit down with your customer database, diary, invoices or whatever information you have to hand about the people who have bought from you. There are several key characteristics you want to identify about your customers:

• age
• income (budget, comfortable, well-off)
• party (eg singles, couples, families, groups etc)
• interests (relaxation, culture, nightlife, shopping, walking, mountain biking)
• attitude to life (traditionalists, discoverers etc see below)
• origins where they come from

Different businesses will have differing degrees of knowledge about their customers. An accommodation business will know quite a lot - you know exactly how many people are in the party, how old they are, you can get a good idea from their clothes, possessions and cars what sort of income level they have and you often know why they are here, their interest and motivations.

Cafés, on the other hand, can only make judgements about people from their appearance and manner of speaking across a very short space of time. Any more detailed information can only be obtained by falling into conversation with customers - a very worthwhile activity, not to be undervalued.

Create a tally

The easiest way to analyse your customers is to create a tally. You need a long piece of paper, or a spreadsheet. On the left you write down your labels for age/party, income, interests and origins. See the table at the end for examples, or click here for an Excel spreadsheet you can download. Then you go through each customer/party and put a mark against the labels appropriate to them. If you do it as a grid you can read down to see the makeup of any one party and across from any label to see how many of that kind you get.

Use your own labels

This list is for your own use, so use labels that are really meaningful to you. If you are finding it difficult to classify your customers then you may not have the labels right. Add any interests that are of specific concern to your business and add any nationalities not already on the list.

How many customers should you analyse?

You don't have to go through every customer you've had over recent months - depending on your business type it may not be practical or possible to do this, though some businesses, especially accommodation ones easily have this information to hand. The more you do, the more accurate the picture. Aim for at least a fifty.

Estimate

If it isn't possible to use actual customer data then go through each label section and mark the ones you think apply most to your business - put 1 for the most represented label, 2 for the next and so on. Beware though: estimating your customers relies on your perceptions and, while no-one knows your customers like you do, there's no substitute for actually counting. (A bit like keeping a food diary instead of just guessing how much you've had to eat and drink...)

Experiment with research

You could try keeping a tally at reception, or the pay desk or wherever is appropriate for your business type over the course of a week or month to see if this matches your expectations, though obviously you may have to make assumptions about income, age, interests etc. Even better, you could conduct some customer research, simple forms left in customers' rooms, at their tables, at the pay desk or wherever is appropriate asking people to indicate their age, party, interests and origins. This is an excellent idea as an ongoing method of capturing customer information. You have to be careful with income, though. People are sensitive. It is better to say, something along the lines of 'How would you describe your budget?: economy - moderate - luxury.'

Identify your key customers

Once you've created your tally you should also check your financial information, if you can, to see which customer types spend the most. Also, if you know it, which are the repeat customers? Which are the most profitable? Which ones are really the bread and butter of your business?

Highlight or write down the most important customer types to your business. These are your key customers. These are the ones you need to bear in mind when thinking about images, text and messages. They are also the ones to bear in mind when thinking about where to advertise. Try to make a list of their key needs - what are they looking for? What makes your business interesting to them? What need are you fulfilling? If you can work out what people like your key customers want, and how to go about providing it, you can allude to this in your text and imagery - and it will appeal to other customers of a similar type.

Who's missing

Now look at who you are missing out on, or only getting a few of. Why? Are there customer types that you aren't attracting that you could cater to? Clearly, you have to be logical about this - you can't easily mix older couples hoping to get away from it all with young active families. But what about business customers, groups or international visitors? Try to work out why you aren't currently attracting customers you could cater for. Is it your marketing - are you not reaching them? Or are you not providing, or not appearing to provide, what they need. Write down each segment you come across that you could be attracting. Write their key needs and make a note of any barriers there may be to winning them.

Don't forget nationalities. The North East attracts hundreds of thousands of overseas visitors each year. Our top markets are: Germany, Norway, Ireland, Netherland, USA/Canada, Spain and France in that order. If you aren't getting any of these customers, why? What could you do to attract them?

Consider the additional information we know about North East customers

View our Key Facts page to get a good overview of who comes here and why, and what they might be looking for. This also covers ACORN profiling (an income, geographical and lifestyle profiling) of our key customer groups and their tourism characteristics. Can you add more to any of the customers' needs after reading this? Or better identify the missing ones and their needs?

Consider your enquirers

Analysing the people who enquired but didn't become customers is also very important. These people found your business and were motivated enough to enquire but then didn't actually buy or book. Why?

Some businesses can't do this - for example café and restaurant owners are likely to have almost no information about people who don't book or call in. But other businesses, especially accommodation providers, will have addresses for people they sent literature to or who phoned or emailed to make an enquiry but never booked. If you go through these can you spot any patterns?

The problem with people who don't come is that you know less about them. Could you be capturing more information at the point of enquiry that would help you a) sell more effectively to these customers and b) know more about who is slipping through your fingers? Could you and your staff be asking: when they are thinking of coming, what's the purpose of their trip, who might be in their group and so on? If you have addresses or at least postcodes for these people, consider socio-demographic profiling (see below).

Lastly, consider socio-demographic profiling

Socio-demographic profiling simply means running your customers' postcodes through a profiling database. This database has been compiled from the census and from very detailed lifestyle questionnaires taken for most postcodes in the country. From this, data mining companies have built up a description of each postcode: who lives there, how much they earn and what their likes and dislikes are. Of course it's a generalisation, of course not everyone at the same postcode is homogenous, but it can be very useful when used properly.

Data mining companies will take your data (you only need the postcodes and you don't need your customers' permission to do it) pass it through their database and add the type and lifestyle information to each customer record (some companies will send you an Excel spreadsheet with a program built into it, so you can do it yourself). This is particularly useful for enquirers about whom you know very little, and will also give you a really good geographic picture of where your customers come from so you know where to advertise and target. But it isn't cheap. It costs about £50 to profile 500 addresses.

What does it mean?

Once you've completed this exercise you have a clear picture of who comes to you, who doesn't, and what their needs are. Consider typing it up, if you've got the time. Then keep it somewhere very handy, even stuck to the wall, because you'll need this information firmly in mind when reviewing your marketing and your advertising materials.

Example customer labels

Age/Party
Under 12s
Teens
Young Singles
Mature Singles
Older Singles
Young Families
Teen Families
Young Couples
Mature Couples
Older Couples
Teen Groups
Young Groups
Mature Groups
Older Groups

Income
Budget
Comfortable
Well Off

Interests
Business
Friends & Family
Shopping
Nightlife
Golf
Walking
Cycling
Mountain Biking
Horse Riding
Outdoor Activities
Arts & Culture
Family Fun
Rest & Relaxation
Urban Culture
History & Heritage
Church
Cruise
Food
Bird Watching
Events

Origins
North East
Yorkshire
London/S East
Scotland
North West

Germany
Norway
Ireland
Netherland
USA
Canada
Spain
France
Italy
Australia
New Zealand