There are plenty of tricks, tips, and strategies out there that can help your small business grow — better customer service, more automation, mobile optimization — the list goes on and on. But the truth is none of these things would work without the customer growth and retention “hack” to trump them all: data.
Small businesses want to make a big splash on a limited budget. That means doing the right things at the right time is critical — not a moment or dollar can be wasted. As good as your business instincts may be, they aren’t a guarantee for making strong decisions. Data can back up or call into question your instincts with facts. This not only helps ensure that you’re making good business choices, it also makes it easier to get other team members on board with your direction. It’s hard for people (politicians aside, perhaps) to say no to facts.
We can even back-up the assertion above with data. Companies that regularly practice data-driven decision making are 6 percent more productive and 5 percent more profitable than those that don’t. Those numbers might not sound huge, but in an increasingly competitive landscape, incremental differentiators can have a big impact.
Business success comes from meeting your customers’ needs. But you can only do that when you know what those needs are. To find out, you could ask. Surveys and regular-old conversations certainly have value. However, they lack some truth. Customers’ responding to overt requests for feedback may provide skewed information either because of a lack of time, a lack of understanding of their own motivations, or a desire to be perceived in a particular way.
What doesn’t lie is data. When you use it to track your customers’ behaviors, you’ll begin to know them and their feelings towards your business better than they know it themselves.
What’s more is that your customers want you to have that information. That fact becomes more true the younger the consumers get. Fifty-three percent of GenXers and 68 percent of millennials report that they’d gladly provide more personal data in exchange for more personalized shopping experiences. We live in a busy world full of competing offers. When you can cut through the clutter with something of unique value, customers will appreciate it.
Traditional selling in the digital landscape means casting a wide net in hopes of attracting a small amount of qualified leads. That approach is no longer sustainable as customers get smarter about spam blocking and more tired of inauthentic experiences. Successful businesses today need to take a more honed-in approach by prospecting only the leads who are most likely to buy. But how do you know who those leads are? You just have to look at your current customers.
By understanding in a deep, data-driven way who your most loyal customers are, you can create buyer personas that help you target similar people who’ve yet to convert. Further, you can examine each existing customer’s journey to close. Where did they first hear about you? What outreach did they receive? What hurdles did they cross before making a commitment? Using that data, you can create buyer journeys and streamline your sales efforts going forward.
What makes data an even more ideal growth “hack” is that you don’t have to go out and buy an expensive product or hire a pricey business coach to achieve it. You already have it, piles of it, you just need to know where to look.
Every tool you use, from your CRM to your marketing automation platform to your website to your email marketing to your social media channels is stuffed with data. You simply have to know what questions to ask, then look to your data for the answers. Here are 10 pieces of data small businesses should seek to better understand their customers.
1. Their names
This may seem like a no-brainer, but in a digital world, it can be overlooked. In email marketing, personalized subject lines are 22 percent more likely to be opened.
2. Other basic demographics
What’s the average age, gender, location, or profession of your customer base? These questions are basic and have big value. They could change when you schedule outreach (Are you emailing a mainly West Coast audience on an East Coast schedule?); what case studies you showcase (be sure they align with the right industry!), and even what products you plan for future launch.
3. Special dates
Still simple, and still important. A friendly email celebrating a loyal customer’s birthday or sending warm regards for your business anniversary creates a human touch that business today is often lacking. It will make you stand out.
4. Net promoter score (NPS)
NPS is the likelihood that a customer would recommend your product or service to a family member or friend. You can use it to identify your most loyal customers and ask them to take actions, such as making a referral. You can also use it to find customer who may be at risk of attrition and intervene.
5. Transaction history
If you gave someone a stack of all your grocery store receipts for the past six months, they’d probably be able to paint a pretty good picture of what’s going on in your life. How many people live in your household? Did you throw a party? Are you on a diet? Were you out of town or too busy to cook? Our purchases tell a story about who we are and what we need. When you understand your customers’ transaction history you can anticipate those needs and provide personalized offers that convert.
It’s also a great tool for getting ahead of churn — if a transaction history suddenly drops, you can step in to discover what the problem might be.
6. Browsing history
Even without making a purchase, a lead tells a story through what they click on and how much time they spend on your website. We don’t shop to find a product, we shop to solve a problem — whether it’s a Christmas present for a hard-to-buy-for friend or a large business need. When you track browsing history you can see what questions your leads are trying to answer for themselves and reach out with specific content that outlines solutions.
7. User experience
If you offer a variety of products or product features, it’s important to understand which your customers use the most. That data will help you better inform what additional products to launch in the future or where to focus improvement efforts.
8. Cross-channel engagement
You likely use a variety of outreach channels to talk to your customers and leads — email, phone, social, direct mail, and so on. Do you know which channels are proving the most successful? If not, you could be wasting valuable time and money trying to reach customers where they aren’t. Understand their engagement and you’ll make better decisions about where to focus your efforts.
9. Their location
Not just geographic information as collected in their basic profiles, but where are they right now. It might sound creepy, but the vast majority of customers surveyed allow their location data to be collected. Why? Geofencing is all about personalized experiences that customer want — they give you information, and you give them offers that make sense.
10. Customer satisfaction
Tracking customer issues and success stories is critical. By following the data about complaints or tickets created through your help desk, you can learn where your biggest problems lie and address them before they get larger. Conversely, noting which customers are most satisfied will help you identify your best people, products, and processes. Then, do more of what works.
Data is the most powerful customer growth and retention tool small businesses have in their arsenal. But like any powerful tool, you must wield it wisely. Ensure you’re listening to the data and being a good steward — there is no small number of disastrous examples to learn from. Most importantly, keep it safe. Customers put their trust in you when they give you their data, so practice good security to keep the relationship strong.