Your Customers are Changing – Are You on Top of It?

There are four generations in the workplace. They all use different channels, engage with media differently, use very different forms of language, and respond to messaging in very different ways.  

You may be feeling this already. Are you seeing diminishing returns on some marketing activities? Things that used to work might be less effective. The platforms are always evolving, but now the audiences are making big shifts.

How is your company adjusting? When is the last time you took a step back to evaluate your customer data? Everything starts with your customer lists. This article outlines where to find your customer data, how to use your data to define customer personas and how to adjust your marketing based on your findings.

1. Where is your customer “list” or should I say “lists”?
To analyze your data, we need to start by locating it. If you are like most small businesses, there probably isn’t one ultimate source of data for your organization. Instead, your data lives in several different systems. Each of these systems will hold valuable parts of what you need to deeply understand your audience, and you may not even know what type of information is available until you dig in. Let me help walk you through a painful list of acronyms to help you try to track it down:

• • CRM – Customer Relationship Management
    CRMs are tools like Salesforce, Pipedrive, Zoho and HubSpot. They usually contain very basic contact information for sales prospects, along with notes about specific deals. Most small businesses struggle to require salespeople to use the CRM, but ideally, your sales team will at least capture these details: name, title, company, email, phone, and a physical address. If a CRM is used more thoroughly, it might have information on the lead sources, product/service interest, reasons for wins and losses and important details about customer questions and pain points.
  • POS – Point of Sale or E-commerce System
    POS and e-commerce systems capture transaction details, which are usually limited to product SKUs, quantity, price and discounts unless the business also correlates credit card information or has additional strategies for capturing customer emails and contact information (loyalty programs, email lists and warranties are among the most common strategies). These systems might be able to provide zip code data, which can be used to understand buyer demographics. Your POS or credit card company might also partner with third party research companies to provide customer insights such as buying behaviors and customer personas.
  • ERP – Enterprise Resource Planning System
    An ERP system, such as Microsoft Dynamics, Oracle NetSuite, SAP or Sage, might contain your sales pipeline data, your customer contact information, purchase history, accounting data and customer service data all in one place. However, most small businesses only use aspects of an ERP combined with various third-party systems, so don’t be surprised to find some information within the system, but even more information living in other places.
  • Accounting System
    Accounting systems, such as QuickBooks, Sage, FreshBooks, Xero and Zoho, can be a great source of information on purchase history, client growth or shrinkage, product/service growth/decline, average purchase prices, customer lifetime values and more (especially for B2B businesses). This system will also often have the contact details or the person making the payment, which usually includes a physical address and zip code. However, in more complex sales, the bookkeeper or controller may not be the primary contact you want to reach from a marketing perspective.
  • Marketing Automation or Email Tool
    Marketing automation tools, like HubSpot, Marketo, Active Campaign and Mailchimp, are centered around customer opt-in frameworks that store emails and cell phone numbers (for SMS messaging), but these often lack full names, titles, company name, phone numbers, zip codes and other information that might be helpful. The good news is that it resides in a platform built to measure engagement, and the system will make it easy to collect additional information from people who are most engaged with your business!
  • Post It Notes, Excel Spreadsheets and Notepads
    If you are like many small businesses, your leads may be written down on a post it note, passed on a piece of paper, tracked in a spreadsheet or automatically forwarded in email from your website. As long as there is some form of tracking mechanism, you can save and improve upon the systems. Just put the paper in a tray instead of the garbage can, and you have a system.

It is rare that we find a small business that has thorough data collection practices. It requires preparation (to add required fields to a form), management and self-discipline (to train and require the forms to be filled out accurately) and regular reporting (to review data and keep it updated). There is no point in collecting data without purpose, so the key is to identify the key data points that will help you improve your business decision-making and then share that data with your team for buy-in on the importance of collecting it. So how will you use this data?

2. Use Your Data to Understand Your Customer Personas

Although some people in your organization may be sensing marketplace shifts, don’t go by your gut, the company owner’s gut or a salesperson’s gut.

This isn’t an activity that you start with subjective input. There is a time and place for interviews and inputs from key team members. You should review data before you make any big changes in your marketing. When I say data, I mean concrete age ranges, education levels, media consumption habits, pain points, technology usage and ideally also hobbies, interests and behavioral data. So how do you start to dig into your lists?

• • Big Data Customer Profiling
    The fastest way to gain very detailed insights into your customer list is to work with a company that specializes in audience profiling. Nielsen, which is a global leader in audience profiling and research, can provide very detailed audience profiles. However, most small businesses struggle to justify the expense. Insights from companies such as Nielsen can cost tens of thousands of dollars and require that you provide a very large customer list (usually upwards of 10,000 contacts with addresses). If you have high-volume credit card transactions, a more affordable route might be to go through your Point of Sale provider (POS) or credit card processor. Many POS providers sell subscriptions to services that provide insights based on anonymized credit card data. In addition to knowing your customer’s repeat purchase behaviors, they may partner with audience profiling services to provide detailed behavioral pictures of your customer segments. This type of big-data profiling is most applicable to consumer-oriented, high-volume businesses. If you don’t have this kind of volume, or operate in a B2B industry, there are other solutions to explore. Read on.
  • Industry Research May be Available
    Trade organizations, industry-specific trade publications and even industry-specific vendors can be great sources of research, data and information. Members often respond to surveys anonymously in exchange for access to the combined, anonymized report. Some trade organizations and publications will also foot the bill for industry research as a benefit to members/subscribers. While this industry information may not be general to your industry and not specific to your business, you can always cross-reference it with your company data to see how your organization matches up with the broader industry. What if you find the industry audience is getting younger, but yours is getting older? You may need to adjust your approach before your audience goes into retirement! Or maybe there is a market shift happening that you are not seeing as a small business. I think every business should identify sources of industry data and review them regularly to stay on top of market changes.
  • Collect Your Own First Party Data
    For many small businesses, having detailed profile data from a research company or a trade organization is a dream. It is also, quite often, simply not within a small business budget. Luckily, there’s another approach that is within reach of any small business – you can collect your own data. What you save in cost will need to be made up in effort, but this data can be even more insightful and actionable, because the questions will be tailored specifically to your company. Every audience is different, and the method used to gather that data will vary depending on your business. Some of the simplest approaches include adding questions to lead capture forms and requiring salespeople to ask questions. You can also conduct more thorough information using surveys, questionnaires or live interview methods. It might be a QR code at a table, a salesperson offering a $10 discount if you take the survey linked on the receipt, or a person setting up phone interviews with customers. Each method comes with its own challenges. For example, each generation will react differently to different survey methods. Older generations may like to talk on the phone, while a younger demographic may be more likely to respond electronically. You may also have to offer incentives to get people to respond to longer surveys, and incentives can tend to skew who responds. These are just some of the issues to be aware of when creating a survey. The goal is always to get a large enough sample to be accurate and provide deep insights, but using any amount of data will probably be better than “trusting your gut”.

3. How to Adjust Your Marketing Approach Based on New Personas
The goal of research is to deeply understand the audiences you are trying to reach. Broken down into the most simple terms, you want to know WHO you are trying to reach, WHERE to reach them and HOW to speak to them to motivate them toward action. You will also want to look for different audience segments, or groups of customers that can be separated based on their age range, media usage, behaviors, needs or pain points.

I really recommend that you let go of any assumptions that you have, or even use survey methods to test your most closely held assumptions for accuracy. Go in with a fresh set of eyes and you will emerge from this activity with a clear picture of your audience or audiences.

• • Reconsider your platforms
    Identify the average age of your customers and ask them what platforms and media they consume. You may find that the average age of your customers is changing. That will likely lead to significant changes in which platforms you are using to reach your prospects because media usage and social channels are so different from one generation to the next.
  • Reconsider your format or approach
    With changes to age and platform, the formatting of your ads and communications may need to evolve. Ask how they prefer to consume information – do they prefer to read articles, listen to podcasts or watch videos? Be prepared to adjust the information to fit the channel, and don’t simply re-use content across platforms. What worked as a radio spot may not translate to Spotify or a podcast. A digital ad in an online publication may not be effective on Reddit or Instagram.
  • Reconsider your messaging and creative
    Did you know there are now Gen Z teachers teaching Gen Z high school and Gen Alpha grade school students? This is driving a significant change from the language used by Millennials, Gen X and Boomers. That means you will need to reconsider the words and messaging that you are using. There is an explosion of new vocabulary that is driven in large part by a digital upbringing and fed by pop culture references. The language and creative visuals that each generation responds to can vary widely.

4. How do you know what will work? Don’t guess! Test.
When you’re developing new messaging or creative, it will help if you can employ a marketing person, team or agency that gets the difference in the approaches for each generation you are targeting. If you have an older marketing team or sales team, consider adding some younger team members or even interns for perspective.

Regardless of the way you are sourcing your creative, any significant changes to your channels, audience or messaging should begin with a testing phase to ensure that the creative you are using is resonating with your audience. This can be as simple as running headlines or ads by some younger people for their perspective. Digital channels such as Meta and Google have A/B testing built into their platforms, so you can take advantage of that and test wildly different approaches to see how your audience responds. You can even test different subject lines in marketing automation systems such as MailChimp and HubSpot.

This is happening now. It’s time to begin adjusting and testing.

5. Your Customer List is Everything!
Having a clear understanding of your customers seems fundamental to running a successful business, but in a small business environment, I have found that many businesses don’t really know their customers as well as they could or should. Many B2C businesses that have relied on social media and digital marketing may not even own a true customer list with details like names, contact information and permission to email. Many B2B businesses struggle to force the sales team to keep a clean set of data in the CRM, and the business doesn’t really own the data. I have seen very few small businesses create profiles or run reports on a regular basis to watch for changing personas.

I hope this article provided some valuable insights into where to find your data, which type of data you should collect, and how to use it to understand your customers better. If you need help with any of this, our Fractional CMOs are available to help you dig into your data, optimize your systems, train your teams and develop new profiles and messaging.