Customer Database: Find and Segment Your Best Buyers
Posted: Tue Dec 03, 2024 7:21 am
Anyone who owns a commercial business knows how important it is to analyze the customer database and australia phone number list focus on their activities. There are different types of buyers : those who buy sporadically and spend small amounts, those who buy with a certain frequency and have a greater spending capacity and those who, despite being interested in the products and services offered by the business, are not adequately encouraged to make the purchase, thus remaining simple potential customers.
Correct customer segmentation therefore becomes of crucial importance to achieve a series of important objectives:
identify top customers, i.e. ideal customers who buy often and have a good spending capacity;
increase the retention of both top customers and more occasional customers;
attract the attention of new potential customers.
To all these advantages is added a more strictly economic one, that is the optimization of investments and the maximization of ROI (Return on investment).
Recency and Monetary Value to Select the Best Clients
The first step to perform a skimming in the customer database is to take into account two fundamental factors: recency and monetary value . When we talk about recency in customer segmentation, we are referring to all customers who have purchased the company's products and services in a fairly recent period of time. The first operation to do is therefore to identify customers who, for example, have made a purchase in a predefined period of time. This allows us not only to understand who the top customers are but to have an overall view of active customers, separating them from dormant customers.
The second factor to take into account, the monetary value , is instead more closely linked to the discussion of top customers and refers to the expenditure made by the customer. In other words, it is a matter of understanding how much the individual customer has spent per unit of time, to identify those who have sustained the greatest expenditure on the company's products and services.
All this allows you to create a real ranking of the best customers ordered by their monetary value and, as previously stated, better understand how to increase the retention of the most active customers and possibly reawaken the interest of the dormant ones.
However, customer segmentation should not be considered a stand-alone operation: it is essential to understand it as an integral part of the marketing strategy and combine it with other types of analysis to obtain a complete picture of the situation.
How to segment your best customers?
One of the most common mistakes made by companies that perform a customer database analysis is to believe that recency and monetary value are sufficient parameters to successfully identify top customers. In fact, there is a substantial difference between a customer who makes numerous purchases spending low amounts and a customer who instead purchases more sporadically but spending larger amounts.
To segment the top customers in turn, it is possible to resort to a simple and immediate graphic representation, as in the case of a scatter plot graph , where the two new reference variables are no longer recency and monetary value but the number of orders and the average receipt .
The meaning of these two variables is very simple: the number of orders refers to the quantity of products and services that the customer purchases in a given period of time, while the average receipt refers to the monetary amount of the expense incurred by the customer for the purchase. Thanks to the use of these two variables it is thus possible to identify four different types of customers :
customers who buy infrequently and spend little;
customers who buy infrequently but spend high amounts;
customers who purchase with a certain frequency and spend average amounts;
customers who often purchase, spending even very high amounts.
Correct customer segmentation therefore becomes of crucial importance to achieve a series of important objectives:
identify top customers, i.e. ideal customers who buy often and have a good spending capacity;
increase the retention of both top customers and more occasional customers;
attract the attention of new potential customers.
To all these advantages is added a more strictly economic one, that is the optimization of investments and the maximization of ROI (Return on investment).
Recency and Monetary Value to Select the Best Clients
The first step to perform a skimming in the customer database is to take into account two fundamental factors: recency and monetary value . When we talk about recency in customer segmentation, we are referring to all customers who have purchased the company's products and services in a fairly recent period of time. The first operation to do is therefore to identify customers who, for example, have made a purchase in a predefined period of time. This allows us not only to understand who the top customers are but to have an overall view of active customers, separating them from dormant customers.
The second factor to take into account, the monetary value , is instead more closely linked to the discussion of top customers and refers to the expenditure made by the customer. In other words, it is a matter of understanding how much the individual customer has spent per unit of time, to identify those who have sustained the greatest expenditure on the company's products and services.
All this allows you to create a real ranking of the best customers ordered by their monetary value and, as previously stated, better understand how to increase the retention of the most active customers and possibly reawaken the interest of the dormant ones.
However, customer segmentation should not be considered a stand-alone operation: it is essential to understand it as an integral part of the marketing strategy and combine it with other types of analysis to obtain a complete picture of the situation.
How to segment your best customers?
One of the most common mistakes made by companies that perform a customer database analysis is to believe that recency and monetary value are sufficient parameters to successfully identify top customers. In fact, there is a substantial difference between a customer who makes numerous purchases spending low amounts and a customer who instead purchases more sporadically but spending larger amounts.
To segment the top customers in turn, it is possible to resort to a simple and immediate graphic representation, as in the case of a scatter plot graph , where the two new reference variables are no longer recency and monetary value but the number of orders and the average receipt .
The meaning of these two variables is very simple: the number of orders refers to the quantity of products and services that the customer purchases in a given period of time, while the average receipt refers to the monetary amount of the expense incurred by the customer for the purchase. Thanks to the use of these two variables it is thus possible to identify four different types of customers :
customers who buy infrequently and spend little;
customers who buy infrequently but spend high amounts;
customers who purchase with a certain frequency and spend average amounts;
customers who often purchase, spending even very high amounts.