The 80/20 rule holds true with almost every aspect of your life.
When targeting your customers, focus on the top 20% of your current customer base.
If you do not have a customer base. Find out what your perfect customer looks like. Who, what, where and when do they buy from you? Build the perfect detailed picture of your future client.
Once you have that picture find out where they hang out. Than find out how to advertise in that space.
Focus on your top 20% and your profits will grow.
Don’t Waste Time! 4 Steps to Targeting the Most Important 20% of Your Customers
Do you know the 80/20 rule of retailing? According to BRP Consulting, 80% of a retailer’s sales typically come from 20% of its customers. The key to growing your business is to identify that 20% and get them to buy more from your store.
Personalization is the secret, according to the new BRP Consulting report, Personalization is Key to Customer Loyalty. Some 44% of consumers say they’re likely to become repeat buyers after a personalized shopping experience with a company, according to the 2017 State of Personalization Report.
But today personalization means more than segmenting customers, marketing to different demographic groups or creating buyer personas. “It is more than simply greeting a customer by name when they walk in the store,” the report says. “Personalization encapsulates all the details that make the customer’s shopping experience unique.”
Using Customer PersonalizationHere’s how to deliver that experience to your customers.
Step 1: Identify
How do you identify your “MVCs” (most valuable customers)? Shopping frequency, shopping recency, and dollars spent are the top three methods, used by 68%, 65% and 64% of retailers, respectively. Some 40% also use social media to find customers who are brand advocates for their business.
However, there’s a potential missed opportunity: Just 52% of retailers identify their most valuable customers based on profitability, and only 13% feel they are doing a good job of this. Once you have information such as recency, frequency and dollars spent, take it one step further and identify which customers are most profitable for your store.
Step 2: Persuade
Once top customers are identified, the next step is getting more personal data from them. Of course, you’ll need to offer some incentives to convince them to share the data. One of the best incentives, according to the report, is to extend “specialized offers” that are based on a customer’s purchase history or are available only to existing customers; 53% of companies in the survey do this. In fact, the survey reports, a whopping 93% of consumers would be willing to give retailers detailed personal information if they knew they would get customized offers in return.
Step 3: Communicate
Share customer information with salespeople so they can give the customer personalized recommendations and provide a shopping experience that surpasses customer expectations. Here’s where many retailers fall short. Even though 77% of retailers overall feel they are able to identify their most valuable customers, nearly half (47%) have no system for communicating what they learn to salespeople.
In other words, one of your MVCs could be going through the checkout line with absolutely no recognition from the salesperson ringing up the sale. How will that make them feel? Equipping your salespeople with the right mobile tools to access customer data can help, giving them the knowledge they need to personalize the shopping experience for each MVC.
Step 4: Reward
How can you make your most valuable customers’ experience more enjoyable? Invitation to special events (69%), personalized promotions (56%), and personalized rewards (50%) are the top three tactics retailers in the survey used to enhance the MVC experience. Other methods include:
- Preferred/early access to new products: 25%
- Personal shopper: 19%
- Special shopping times/days: 17%
Your MVCs have already proven their loyalty to your store—but in order to keep them coming back, BRP cautions, it’s essential to ensure that every shopping experience they have with your business is both personalized and positive.