Secret Trade Secrets on Defining Your Audience

So who's buying your product anyway?

The more you know about your customers, the better you can serve them and develop new products and services that fit their lives.

Who the heck are these people?

What kind of people visit your retail stores, purchase from your print catalogs, buy on your web site, or on their mobile phones?

How are marketers targeting people by income, age, house value, hobbies, magazine subscriptions, etc., etc., etc?

Let me tell you about the data overlay.

Floppy-Disk-1.44-Mb_FujiFilm-MF2HD_82374-480x360photo © 2010 Emilian Robert Vicol | more info (via: Wylio)

That's right. If you want to spend a little money (there's usually a fee per thousand records) and you have valid street addresses on your customer file, you can buy hundreds (even thousands) of data points on your customers. What kind of cars do they drive? How many children do they have? What type of home do they live in? How educated are they?

Understanding some key data points about your customers will help you to group them into buying segments.

Having all of this data enables you to profile people who behave in a certain way. Maybe most of your catalog customers are married men over the age of 55, and most of your mobile customers are single women aged 18 - 27. Perhaps the people who spend the most money with you per order are married female online customers aged 30 - 45 with a household income of $60,000 per year or more and a college education. Perhaps gardening hobbyists are attracted to your brand.

There are lots and lots of data points. What should you buy?
I recommend the following for most products:
Household Income
Net Worth
Presence of Children
Ages of Children

Then, it depends. If you're selling housewares, you'll want to know what types of homes people live in. After all, you don't want to send your outdoor furniture catalog to people who live in apartments. If you're selling pet-related products, then you'll want to buy data on pet ownership. Ditto for cars. If your product is related to a specific hobby (say gardening or travel), then you'll want to make sure you get your records flagged for customers with those interests.

How does it help?
Knowing more about your customers' basic demographic makeup helps you to craft products and messages that are tailored to their stage of life. It also helps you create groups of customer clones. In the example above, I mentioned that your most profitable customers might be educated, high-income, married females age 30 -45. Since you know that this type of person has potential to be extremely profitable for you, now you can start looking for places to find more people like this. By cultivating people who are a lot like your best customers, you're raising your chances of getting more good customers.

Where does this data come from?
There are several organizations that collect this data, most notably the three major credit agencies. They get it from warranty cards, survey responses, loan/purchasing behavior, and a number of other sources. If this gives you the heebie-jeebies, you can contact the Direct Marketing Association or sign up for OptOutPreScreen to protect your privacy.

Now what?
You can contact any one of several vendors who provide data overlay services, or contact me and I'll help you get started.

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