No, I’m not going to write about Coronavirus. I’m sick of Coronavirus. Not sick with Coronavirus (yet) but sick of the 24/7 news cycle about it. So I’ve washed my hands (again!) and thought I’d write – or ramble – about something else…how much do you (or your clients) know about your customers – and can they provide the key to unlock more sales. The answer is… they can.
I have had a brief conversation about this on LinkedIn which got me thinking about this. Someone looking for feedback about their offer…and my advice was ‘ask your customers’ – the people who pay you money for your service. More importantly, ask your prospects, the people who haven’t paid you money yet – you might just find out why!
Over the last 20 years, I have had a lot of exposure to customer research and segmentation. I haven’t always worked for companies who can afford research agencies so a lot of times, I have had to do it myself. It’s like when the plumber used to come to the house – my dad always used to watch him closely so he wouldn’t have to pay for him to come out the next time – he would do it himself. Over time, you can develop yourself into quite a good DIY plumber/researcher – especially if your budget dictates it.
My first proper job out of Uni was in the marketing department for Greenalls Off Licence division – you all remember Off Licences (OL). One of my jobs was to assess new potential OL sites from a customer perspective. I had to research how many other licences were in the area, how many people lived within half a mile to determine whether there was sufficient demand for another local shop. More importantly, I had to find out what TYPE of people they were. We had a number of OL brands and understanding what type of people lived in the area determined whether we would put an upmarket ‘Wine Cellar’ store on the site or a more price focused ‘Booze Buster’.
We used a segmentation platform called Mosaic, which I fell in love with, and am still slightly obsessed with now. Mosaic is a system which breaks the entire population into about 60 different groups. It’s based on all manner of information sources from the census down to financial applications for loans, which they aggregate to create people ‘types’. It means you can understand more than just age and socio-economic segments, you can dig into thier demand patterns, their attitudes, their aspirations. Its amazingly accurate, based on your postcode or even your individual house. When you find out your own ‘type’ and the description of it, you actually get this spooky feeling that Big Brother is watching you!! I’ve used Mosaic ever since – its a great way to influence your marketing strategy
Let me tell you a little story about Mosaic and how it can affect your marketing strategy. In Australia, there is a TV company called Foxtel who own the TV rights to the Rugby League on a subscription model (for UK comparison, think Sky owning the Premier League rights).
Foxtel had a problem selling subscriptions to a very specific group of households in Queensland. Essentially, they were working class families with grown up children who were working and who still lived at home. The kids all paid their ‘keep’ to their mum who controlled the family finances. The mum refused to pay for the Foxtel subscription so if the grown up kids wanted to watch the Rugby they had to go to the pub to watch it. Foxtel tried all sorts of tactics to attract this group but couldn’t get them to buy. So they tried Mosaic…
They looked at the ‘mosaic profile’ of people they were trying to target and looked at the other things they did. They found that the mums who wouldn’t pay for the TV subscription were the same mums who would sit at home in the afternoon and watch all of the US-imported soap operas that at the time were available on terrestrial TV channels.
What did Foxtel do? Simple, they went out and bought the rights to every single US soap and created a new channel – that was only available through subscription to Foxtel, bundled up with Rugby! Guess what – they absolutely nailed it!
Of course, you can’t solve everything through Mosaic. The other way to find out what your customers think – is to ask them. You can find out so much just by asking them and in my experience, customers really enjoy telling you what they think. If anything, it improves the relationship between you and your customers because it shows that you actually care what they think!
Let me give you another example. When I lived in Australia, I worked for an amazing luxury expedition cruise business. We were relatively small but ambitious to grow. In 2008, during the Global Financial Crisis, the whole world went into shutdown mode and our bookings fell alarmingly (Sound familiar!!). While we worked hard to keep the sales moving, we also took the opportunity to review our brand and our marketing with the goal of coming out of the crisis in a much stronger position.
The first thing we did was take all of our top customers away and find out more about them. We used to have a ‘repositioning voyage’ where we had to get to the ship from A to B. Normally we do this without passengers, but this time we invited our customers and spent three days on the ship with our team and talked to them about our brand, about other brands, about allsorts really.
Then we came back to the office and we asked similar questions to our database of prospects. The people who had contacted us, requested a brochure, been to a sales event but had never actually booked to go on a cruise. And we compared the two results…
I could talk for ages about what we found out but in summary, it was this…the product we were marketing was not the same product that our customers were buying! All of our communication was around an experience on an uber-luxury ship to some interesting places. What our customers were buying was an opportunity to visit unique destinations – the specification of transport (award winning food, the finest cotton bedsheets, marble bathrooms with gold taps, the highest crew to passenger ratio in the world) didn’t even register – it was almost taken for granted.
What we also found was that the luxury branding really appealed to our prospect list. They were the people who probably couldn’t afford to book, saw it as a ‘once in a lifetime’ trip or something they would do when they won the lottery. The were the type of people that we couldn’t build a successful business with.
We realised we had to work hard to find more people like our existing customers. And at the same time, reduce the amount of time, effort and money we were spending on people who loved our expensive brochures, but were never going to book a cruise.
The end result was we changed our brand positioning and communication, focused less on the luxury and more on the experience itself. With the help and hard work of an amazing sales and marketing team and an internal creative process that we also created to improve productivity and reduce costs, we took things to a new level. We came out of the GFC in a much stronger position with a brand much more comfortable with itself and its relationship with its customers. It all came from talking to our customers.
We are about to go into a short period of low demand caused by this coronavirus, the first major global dip since the GFC. A lot of businesses will be affected by this. Do you know your customers well enough to come through this or can you find a couple of nuggets of truth which will help you come out of the other side??
If you’d like to find out more about how we did this work, or would like to see how it could work for you, give me a call. This is the type of work that a ‘part-time marketing director’ can do for your business, the vitally important stuff that sometimes gets pushed to the back of the shelf.
Have a great weekend. Wash your hands.