Customer Analysis

Customer Analysis Steps

To successfully sell a product or service, it’s essential to know your target customer and what factors affect their buying. This is where Customer Analysis becomes integral to how you sell. This exercise aims to develop a “buyer persona,” which helps identify the target audience for selling and determine the right approach to sell to them. To understand your customer, there are two crucial aspects:

1) Behavior - How does this product or service fit into their lifestyle?
2) Demographics - Attributes that make up your customer.

Four Key Purchasing Factors

Understanding customer behavior involves comprehending the factors that impact purchasing decisions and the overall buying process. Consider the following 4 main factors consumers make while purchasing toothpaste:

1) Price - What is the price?
2) Quality - Is this good-quality toothpaste?
3) Convenience - Can I buy it now, or do I have to wait?
4) Prestige - Will others notice me?

When considering your product or service, evaluate it based on these four factors. Your objective is to pinpoint the essential features that potential buyers will seek when shopping for your product or service.

Customer Behaviors

When it’s time to make a purchase, customers typically go through certain behaviors as part of the buying process:

1) What sources of information do they need?
2) What is the timeline for purchase?
3) Who has the authority to make the final decision?
4) What is the price versus similar products?

While the list is concise, it offers valuable insights into your customers. By answering these fundamental questions regarding their behavior, you can better understand who your customer is and visualize them more clearly.

Customer Demographics

To fully understand your customers, it is vital to consider their attributes or demographics. For instance, if you are selling toothpaste, there may be multiple buyers for the same product, and each group may make their purchasing decision based on different behaviors. Therefore, it is crucial to consider these differences when targeting your audience.
Things to think about when segmenting your customers by demographic:

1) What is the customer's age range who wants my product or service? 
2) Which gender would be most interested in this product or service? 
3) What is the income level of my potential customers? 
4) What level of education do they have? 
5) What is their marital or family status: do they have kids?
6) What are the hobbies of my target customers?

Creating customer personas becomes easier once you have gathered details about your customers’ demographics, purchasing habits, and buying patterns. Existing sales and customer information can simplify the data analysis process. However, suppose you’re launching a new business, service, or product. In that case, you need to put in extra effort to create your ideal customer.

In my upcoming blog post, I will discuss the next step in marketing analysis, which involves examining the competition.