With any relationship in life, successful communication is a two-way proposition based on mutual interest. Even the best of friends will on occasion tune each other out when the conversation becomes too one-sided. So, smart marketers are learning the imperative of keeping communications relevant and two-way.
For many, a first step in the right direction to a better understanding of customer needs and wants has been the utilization of personas. The emergence of new sophisticated direct marketing tools and a broader array of marketing channels make it easier than ever to reach out and touch the individual customers where, when and how they want to be reached. This is why now is the time for marketers to move beyond the generalized customer personas and talk to each person one-on-one.
What’s In a ” Persona ” ?
First introduced in 1991 by Alan Cooper, personas have evolved as a popular technique for marketers to attempt to segment customers better and more effectively address their needs and wants, giving them the background they need to create more targeted messages. Personas create fictitious names and personalities that represent various personal attributes for specific targeted demographics. Those names are assigned characteristics and are placed in environments that depict specific buying behaviors. The primary goal of building personas is to increase the likelihood that a product is sold based on information about the target buyer. But do personas provide all of the information a marketer needs? Can we really understand all of our customers ‘ habits and choices based on a handful of fictitious profiles?
It’s easy to see why marketers have become enamored with the idea of personas – they are an honest effort to define the customer and identify his/her wants and needs. They serve a meaningful purpose for getting company sales, marketing and design teams in the right frame of mind and thinking about the customer as a human being, rooted in primary customer research as opposed to nameless, faceless demographic segments. Personas are a good start, but they just don’t go nearly deep enough to create individual customer profiles that can affect the kind of business results that matter.
When it comes down to directly connecting with the customer, marketers have to be prepared to talk to the unique individual. The reason is simple: Because the customer can tell the difference, we are required to treat different customers differently. There are very few of us who fall neatly into an amalgamation of customer attributes and therefore, to achieve a meaningful level of relevant communication to the customer – meaningful enough to precipitate a response of some kind – marketers must build marketing programs that are responsive to individual customer preferences and data.
Will the Real Customer Please Stand Up?
An electronic retailer is looking to drive traffic to its new Web site. The retailer has built a multi-channel marketing program offering discounts for future online purchases of newly-released electronics products. To facilitate “versioning” of messages to the customer base, the retailer has created six personas for the campaign based on demographic information and disposable income numbers.
Let’s have a look at two customers who fall into the “E-Junkies” persona. Both Joe Stone and Fred Smith are 30-35 years old, married with two children, living in an urban area, business men who travel, have a moderate amount of disposable income, and a history of shopping for electronics. They also both purchase at least three major electronics devices over the course of a year. Based on demographics, Joe and Fred are each a neat fit for the “E-Junkies” persona; however, when we dig further into their profiles, we find two unique individuals.
Joe doesn’t want to waste time at brick and mortar stores, so he does most of his shopping online. He does comparison shopping by researching sites online and asking co-workers what they think about products. He rarely sees the product in person before he buys and is not driven to purchase by new releases. If he can find superior product recommendations through credible online sources, he is sold. Most of Joe’s purchases are made over holiday periods throughout the year – Christmas, birthdays, anniversaries, both for himself and for his wife, who’s a gadget geek.
I n sharp contrast, Fred would never dream of purchasing electronics over the Internet. He is attracted to electronics by the look and feel. Without that sensory stimulus, the product just can’t live up to his expectations. Fred needs to test his gadgets personally and prefers the advice and recommendations from in-store personnel. He loves having the latest and greatest version of a product. He can’t get the item into his hands fast enough and waiting three to five days for a product to be shipped is unthinkable. Fred’s purchasing habits are often based on new product release dates. If a product is being launched in stores on a certain date, it is almost guaranteed that Fred will be there on day one to make his purchase.
While personas claim to provide a greater understanding of your customer, they can fall far short when two people have similar profile information but very different wants and needs. While the marketing program may be well thought out and attempts to speak directly to customers, it also needs to take into consideration how, where and when Joe and Fred consider and carry out their purchases. By segmenting and generalizing, the marketer in this example has lost sight of the individual and therefore risks losing significant revenue by ‘dumping’ communication based on defined segments or personas as opposed to pushing out a choreographed communication stream based on individual behavior and profile.
Speaking to “The Real Customer”
Because of the complexity of creating hundreds and hundreds of various communications messages, speaking directly to the customer has had its challenges for marketers. Fortunately, new marketing techniques help drill down to an individual’s preferences and behaviors, enabling far more targeted and relevant communication that say to the customer, “We know you and we’ve built an offer geared directly to you.” Whereas personas have the potential to miss the mark completely, preference-based direct multichannel marketing approaches are based on the preferences of individual customers, and lead to more successful marketing programs and more valuable customers.
Many of these programs start with creating “Preference Centers,” which enable consumers to self-select future marketing communications offers- letting them choose where, when, how often and the type of information they wish to receive. This information, combined with the behavioral, transactional, event and life stage data available on each customer, enable companies to trigger timely relevant communications that map directly to the individual. For example, Jill, 35, a single mother of 2 with an income of $75,000 recently opened a checking account with her local bank. Based on transactional data, her account balance is unchanged. This behavior — leaving money in the bank unused — triggers a communications specifically geared toward Jill regarding the benefits of opening a CD and how that may be better suited to her needs for saving or setting aside funds . On the other side of the spectrum, there’s Jenn, 37, a single mother of 1, with an income of $82,000 who also recently opened a checking account. There’s a lot of activity on her account and she’s continually in danger of spending more than she has in the account. These transactions trigger communications to her on a weekly basis alerting her that her account is overdrawn. Based on her behavior and needs, the bank has sent her an offer to open a savings account — or a line of credit — that could be linked to her checking account to help alleviate this problem. This highly-granular level of communication provides customers with the confidence that the bank not only views them as special and unique, but understands how to meet their needs better than any competitor out there.
Talking about “customer relationships” is easy. The hard part is making work for each customer, and thinking of the success of each message, not just each campaign. The quest to understand and act on individual consumer habits and behaviors may seem daunting. But the payoff for careful planning and using the right marketing tools comes in the form of increased customer and firm value. The alternative? Taking short cuts that will undoubtedly lead you down the wrong path and leave you scrambling to win back your customer again and again. If you speak to the person, and not the persona, chances are you’ll discover a customer loyalty you never imagined possible.