SAN FRANCISCO — The more you know about your customers, the more you can engage them with your services. The more you know about your best and most profitable customers, the more you can attract prospects that will become best customers.
So how do you go about it? You may have worked on compiling demographic information such as age, location and income levels. But is that enough?
Let’s use a hypothetical example: you have determined that you want to target consumers who earn more than $150,000, live in a specific ZIP code, are 35-45 years old, own a home worth more than the median price in your market, and have a college degree.
I’m going to describe two prospects:
Prospect 1 — This business banker drives a Lexus, is married to an attorney, has two children attending private schools that require uniforms, wears high-end designer suits and custom shirts, attends charity dinners for the arts, travels frequently domestically and internationally for business and pleasure, is an avid cyclist, invests in an art gallery, has a personal trainer, has had cosmetic surgery, uses a Nordstrom personal shopper for clothes, and has Frette linens for the home.
Prospect 2 — This electrical engineer works for Google, owns a Tesla, is not married, has no children, resides in a “tech” district loft, eats most meals out or while working, bikes to work, wears lots of Under Armour® purchased online, lives in Nikes, buys every Apple product immediately upon its release, spends work and social time with the same people, and is always dreaming up new apps.
Both of the prospects I’ve described fit your demographic profile, but when you add their psychographic information to the equation, which is the most likely dry cleaning customer?
In the fields of marketing, demographics, opinion research, and social research in general, “psychographic variables” are any attributes related to personality, values, attitudes, interests or lifestyles, says Wikipedia. They are also called IAO (interests, activities and opinions) variables and can be contrasted with demographic variables (such as age and gender), behavioral variables (such as usage rate or loyalty), and firmographic variables (such as industry, seniority, and functional area). Psychographic profiles are used in market segmentation as well as in advertising.
The science has become so precise that it allowed the retailer Target to identify future mothers early in their pregnancies, often before their friends and families knew, and to “target” them to buy specific products during and after the major life event of the birth of a child, according to a recent New York Timesarticle.
Target’s model was so successful that the retailer got major media attention and enough pushback that it had to adopt a stealthier approach by imbedding the offers in more general merchandise flyers.
Even if this makes you nervous as a consumer, it should get you excited about the capabilities and power of knowing and planning around the psychographics of your best, most profitable customers and the concept of targeting their “clones.”
Numerous services can provide you with psychographic profiles based on minimal information from your customer lists. Ask for a referral from your marketing service providers. (If you have difficulty finding an affordable source, you’re welcome to contact Methods for Management for a referral.)
Take note that it won’t be a profile of a specific customer but a composite profile of the list you submit. For example, you might receive a profile that includes statistics showing that (of submitted customers):
The profile will include many lifestyle categories, interests and habits, as well as specific “communities,” “clusters” or “tribes” depending upon the profile source. These segments are summarized to help you better understand the motivations of each group.
The capabilities of detailing the passions, habits, motivations, health, activities and physical movements of these “tribes” is growing exponentially with the GPS tracking imbedded in their mobile phones. For example, Google provides “Latitude – See where your friends are, share your location…Turn on check-in notifications for nearby places once you’ve arrived or choose places to be automatically checked in at.” If you are unfamiliar with this service, you can see it at google.com/latitude.
The resulting information could lead you to reach out to your customers and/or target prospects in various ways:
Make your donation unusual enough—a free year’s worth of shirt laundry, for example—to get the attention of the night’s celebrity emcee so he or she mentions your name many times. Ablitt’s Fine Cleaners & Launderers garnered many comments with their donated napkins sporting the slogan, “Thank you for wearing clothes.”
Some of the most successful efforts combine your raving fans (those on your original best-customer list) with your target prospects. A unique, invitation-only event co-mingling the two groups could make a significant impact on your sales and bottom line.
Your marketing investment need not be costly. Narrowing the target allows you to spend only on high-probability prospects and to direct your efforts only at their specific motivations, resulting in a higher response rate and lower total marketing cost.
And there are other related lifestyle businesses that would like to be co-sponsors to your elite group, so you can share the cost of a given effort and keep your costs low.
A successful example of this concept relevant to the cleaning business is Little Black Dress Wines’ development of “Fashion Swap” evenings. The wine company has created a step-by-step guide for hosting a fashion accessory swap event during which, of course, the host will serve its wines.
You might join forces with a local specialty store (one that you identify through your profile) for a fashion show, or with a men’s big-and-tall store (if your profile shows a high percentage of prospects in this category) for a designer trunk show. Customers are always asking retailers to recommend cleaners that can properly care for their wardrobes, so you want to be a retailer’s top-of-mind cleaner when the opportunity arises.
The direct sales line representatives, such as Carlisle, Doncaster and Worth for women and Tom James and J. Hilburn for men, are usually eager to work with you as well.
Don’t forget home décor and linens as a way to reach both customers and prospects, especially since this is one of the growing sales categories for dry cleaners now.
These are just a few simplistic examples of ways to use the information you have to retain and expand business with current customers and to increase the number of highly profitable customers by catering to their specific motivations.