BrainTrust Query: The Many Sides of Me
by Mark Price, Managing Partner of M Squared Group
How can one person be many people at the same time?
When they fall into different segments for different companies.
my One Hour Martinizing drycleaner, I am a Best Customer and also an
evangelist. To Barnes & Noble, I am a frequent customer, but not
a best one since the largest share of my spending now goes to Amazon
to feed my Kindle. To Punch Pizza, I am not even a best customer. I don’t
eat that much pizza and the bulk of my pizza money goes to frozen
pizza we eat at home.
you look at my demographics — age, income, family size, education, neighborhood
— I would look like the same person to every store. But if you use the
transactional data — my frequency, dollar amount, product mix, and combine
that information with share of wallet (the percent of my spending going
to that store) –you see a very different picture.
different picture is why segmentation should begin with behavior. Behavior
is what we need to understand, since behavior is what we, as marketers,
want to influence, by building stronger relationships and brand affinity.
are composed of three elements: transactions, interactions and attitudes:
- Transactions keep the lights on. There is no question that maintaining
and expanding transactions are key to a company’s success. Yet, paradoxically,
the more you focus on transactions in communications and offers, the less
likely you are to have long-standing customer relationships. Transactions
MUST be measured as an output, a lagging indicator. But if you constantly
sell, sell, sell, you will forget to converse and to listen.
fuel relationships. Interactions are actually the leading indicator for
transactions, although many companies still do not realize it. Interactions,
as I refer to them here, are the non-transactional contacts that a company
has with customers — customer service calls, website research, social media
interactions with fans, detractors and others, sales force visits, etc.
Exceeding expectations on those interactions are often the greatest predictor
of the next transaction, and the next, and so on.
- Attitudes are the end
result of interactions plus transactions. They
start with preconceived notions about the company and then are either disproven
or proven out through the tenor of the interaction plus satisfaction with
the end product.
do you measure attitudes? Well, the normal answer is to conduct surveys,
but those only touch the survey-friendly portion of your customer base.
how do you understand customer attitudes? The only way that I have found to
work is to collect, collect, collect information at every touch point, every
interaction, every transaction. Collect these little “sparks” and gradually
you will accumulate a light that can shine on your customers and provide insight
for your contact and interaction strategy.
Questions: What are the opportunities as well as challenges in segmenting
customers based on their individual behavior? Is it an attainable goal for
bigger retailers or only an opportunity for smaller stores? Do
you agree that a focus on interactions and attitudes has to drive such