Accelerating Digital Innovation in eCommerce
The shift towards eCommerce as the main mode of selling was a gradual one, until the pandemic hit. Then, everything changed. Businesses that had hardly developed an online presence suddenly were forced fully online. Businesses that had never had an online presence were now finding their place in the ecommerce world. That means there are new competitors and a more global focus of many companies that previously stayed local, especially in retail.
So how do you stay ahead of the competition? Selling smarter not harder.
"The global pandemic has accelerated the shift toward the future of eCommerce, with digital investments in selling smarter becoming increasingly critical to meeting consumers’ new needs and fending off new competitors." - Cetrix
In order to stay ahead of the competition, your business needs to stay ahead of the customers. Your business needs to know how your customers are acting and thinking. That means conducting a customer behavior analysis.
What is Customer Behavior Analysis?
Customer behavior analysis uses data to understand a customer’s habits and desires to increase conversion and engagement.
Customer behavior analysis uses predictive marketing to determine how a customer may act and what additional actions or experiences may be needed for them to make a purchase. Predictive marketing helps an ecommerce company stay on top of the trends before they happen. Reactive marketing (the opposite strategy) bases its strategy on what trends have already been established, rather than proactively designing a marketing strategy based on the future. Predictive marketing keeps a company one step ahead of the customer to help them feel understood rather than advertised to.
Not only can customer behavior analysis predict future trends, but it can also help your company connect with customers. Customers each have their own reason to purchase from a particular ecommerce brand. It may be convenience, conscience, quality or collaboration. Understanding how your customers make those decisions can focus your marketing strategy on the customer’s desires.
Most customers want the purchase they make to be convenient. They don’t want to have to search around for hours and days for the ideal product. They are happy to let you reveal it to them. Convenience can be especially impactful if your product is something low-cost or that customers will need to purchase regularly.
Conscience More and more these days, people are basing their brand choices on the impact a company makes in the world as a whole. There are many options out there for any given product or service, making choosing one retail brand over another a daunting task. Customers want to know that your business has a stake in the world as a whole, not just your product.
Especially for high-cost or one-time purchases, quality may be the main driver of conversion. Customers want to know that if they make this purchase, they will not have to invest additional time and money into fixing it or making it meet their needs. Quality and convenience can sometimes be opposing forces, so understanding which customer personas value which of these attributes can be essential to forming your marketing strategy.
Customers want to know that they had a say in the product or service that they chose. This can mean engaging customers in development, offering options, or asking for feedback. Giving your customers a personal stake in the product or service gives them a reason to come back and refer a brand to others in their network.
Ultimately, customer behavior analysis is a way to find out what drives your customers to conversion and what might put you above the new ecommerce competition.
Benefits of Customer Behavior Analysis
Customer behavior analysis allows your company to develop a proactive rather than reactive marketing strategy. By thinking about who the customer is fundamentally, you can anticipate future trends, predict the value of a customer persona, optimize your content, and ultimately retain your ideal customers. Rather than wasting time and energy in the wrong places, you can focus your effort on what gets the highest ROI. In other words, you can sell smarter not harder.
Anticipate future trends. Understanding your customers on a deeper level allows your ecommerce company to anticipate how they may act in the future. For example, customers who currently purchase disposable plastic bags, but who also follow many environmentalist groups on social media, may eventually look for a more sustainable solution to replace the plastic bags. As an online retail company today, it is important to have the product ready before the customer even knows they want it. They may not have searched online for it yet, but the trend is likely to happen.
Predict customer value. Customer behaviors can also help you predict their retail value to your company. It’s hard to think about, but you may not want to market to a group just because they might purchase. Customers who are one-time purchasers may not be worth the effort of targeted marketing. Your business wants customers that are going to be brand-loyal and continue marketing for you on their own. Your investment in getting them as a customer will lead to more purchases down the road, as opposed to someone who will make a purchase and then never engage with your company again. Let the new ecommerce competition have those customers. You want the ones who come back for another purchase.
Optimize content. Content can be a major driver of online traffic. Content can come in the form of a blog, white papers, webinars, or podcasts. But what topics should you include in this content? You could get content created that speaks to every possible topic related to your company. But let’s save you some time and money. Customer behavior analysis determines what topics are most likely to resonate with your customer personas, to optimize your content.
Retain customers. When you have marketed to brand-loyal customers, anticipated their needs, and given them the content most relevant to them, you are more likely to retain customers. Customer behavior analysis can take it a step further, though. It can help you understand why customers chose not to come back or why they abandon their carts online before making the final purchase. You can then develop marketing materials and strategies to combat those reasons.
Designing a proactive marketing strategy using customer behavior analysis can not only improve customer relations, but also revenue. For ecommerce businesses, it can increase sales by 10% and conversion rate by 22% on web traffic alone. Not to mention email campaigns, SEO content, and advertisements.
3-Dimensional Customers: Factors that affect customer behavior.
At this point, you are probably wondering where to start. There is limitless data that could be collected on any given customer group, but how do you choose the right data to truly understand your customers? There are three dimensions of a customer that influence their behavior: personality, psychology, and environment. Focusing on measures that give you insights into these three areas will provide you with the best starting point.
Personality. How a customer acts in a given online or in-person environment can tell you a lot about how to reach them. Some people are more outgoing while others are introverted. Extroverts may desire public recognition of their purchase or engagement with a retail brand, whereas that same public recognition would make introverts refrain from purchasing. Understanding where your customers fall on that spectrum will help you to develop the ideal marketing campaign and incentives.
Psychology. A person’s psychological responses heavily influence their behaviors. A person who feels supported by a company will be more likely to purchase from them than someone who feels frustrated by a company. Consciously or not, the way your marketing affects a person psychologically can make or break your conversion. However, these psychological responses are difficult to track due to the impact of external factors, especially in an ecommerce environment where your customers may not be local.
The environment in which a customer goes about their life has a huge impact on their purchases. Perhaps most importantly, is the social influences they encounter. Understanding what social influences that your customers choose to listen to can help you understand what trends they may follow. For example, a young adult who follows popular music may make fashion choices very differently than a parent who follows mommy blogs. Knowing what they are influenced by can tailor your marketing to that type of voice or content. This is especially important for ecommerce businesses where online influences are affecting your business every day.
Selling smarter means understanding all the factors influencing your customers.
How to conduct a Customer Behavior Analysis
This all sounds great, right? Increasing conversion, customer engagement, and revenue. That is exactly what a good online marketing strategy should do! But how is customer behavior analysis actually done? Here are 5 easy steps to get you going.
- Break down the personas. Each retail business has a variety of customers and each may purchase for a different reason. Breaking down your customer base into personas is the first step in understanding how to analyze what behaviors each group exhibits.
- Identify the benefit. Each persona is going to see a different benefit in your product or service that will lead to conversion. Understanding what that benefit is will help you understand why they take certain actions...or don’t take certain actions.
- Organize quantitative data. Decide what data points you will need to fully understand your customers’ behaviors. Don’t stop within your own company, either. As discussed earlier, it is important to understand the external influences and overall trends that impact your customers. Searching through secondary sources such as online reviews or analytics from competitor retail companies can offer insights you may not see in your own customer base. Finally, search third party data such as retail industry reports. (Remember, you want to sell smarter with predictive not reactive marketing.)
- Compare data to the customer experience. Once you have this data, go back to your customer journey mapping and analyze the data. Find out which persona made a purchase at which stage of the customer journey. Then compare that data to the customer experience. Is there one pathway that was most effective for a certain persona?
- Start selling smarter. Once you have analyzed the data, it’s time to take action. Develop a campaign using the insights you discovered. Once the campaign is complete, analyze the success of the campaign and determine any next steps.
Customer behavior analysis allows you to get a comprehensive view of your customer through data-driven analysis of their tendencies. You can then use that analysis to drive targeted marketing campaigns, rather than wasting time with leads that won’t convert.
What to consider when choosing a marketing system
There are many services out there to aid you in designing your customer behavior analysis. Here are some factors to consider when choosing your ideal solution.
Templates. Does the service offer templates? Honestly, you don’t have time to start this process from scratch. This is a time sensitive matter with all that new competition in the ecommerce world. And why should you have to if someone has done it before? Your company has already started something unique in your retail delivery or products, so no need to reinvent the wheel on this one. Find a solution that offers pre-made templates that can streamline the process.
Integration. You also have online systems already in place that this solution will need to integrate with. When deciding on which solution to use, make sure you have options for seamless integration to your current ecommerce platform.
Ease of use. Some marketing software can do everything imaginable...if only you could figure out how. Find a solution that offers all the options you actually need while also being easy to use. Again, you’re busy. Your business needs a solution that can be implemented effortlessly and quickly.
Customization. On the opposite end of the spectrum from the overly-complicated-but-comprehensive solutions, are the one-size-fits-all solutions. Chances are, that won’t quite work either. Find a solution that offers you customization options that fit your needs. You may not need all the bells and whistles, but you do need the solution to fit your company uniquely. No retail company is created equal, and each needs some level of customization. This is all part of selling smarter, not harder. Only pay for what you actually need, but pay for it if you need it.
Automation. Sell smarter with smart technology. Nowadays, more and more things can be taken off your plate by automation. Find a solution that does just that. There are solutions out there that can have conditional marketing actions. For example, if a customer clicks on multiple online products that have been labeled as “handbags” the software might offer suggestions of other handbags they might be interested in. Get a solution that saves you time and does the work for you.
Instant Integration with Omnichannel Automation
Your customers expect personalized experiences driven by their current preferences and recent interactions. At Cetrix, our solution enables ecommerce businesses to engage their online customers at optimal points along the customer journey, in real time and through the most effective channels.
As consumer behavior continues to shift rapidly in our pandemic-changed world, we are focused on improving the customer experience process with omnichannel smart AI operational capabilities to deliver the right marketing strategy to the right customer at the right time.
You need a partner that is ready to handle this ever-changing ecommerce environment. Here at Cetrix Cloud Services, we are already doing just that. We have a dedicated team to help your company navigate retail customer behavior analysis and take your profits to the next level.
For more information, visit our Why Cetrix?page or contact us at email@example.com. We look forward to hearing from you!