How customer data management can unlock growth and power revenue

Customer data management deserves more credit in conversations about growth. So, you’re ready to tap into your well of customer data and use it to drive next-level business revenue. You recognize the value of incorporating customer data management best practices. And you understand the value of customer data management – maybe you’ve even made the case for why your company should invest in a robust customer data platform.

Now, it’s on you to bring those growth strategies to life. Where do you start? Here are just a few strategies for unlocking sustainable growth through customer data.

Customer data management: Know thy customer

How well do you actually know your customers? At the very least you should be able to spout off a hit-list of demographic information – average age, geographic location, and so on. Maybe you have an idea of what they do for a living and some insights into that industry. But beyond that, many companies tend to fall off.

These days, that doesn’t cut it. We have so much customer data at our fingertips, and customers know it. Not just that, they’ve seen how sharing their data can lead to amazing customer experiences and have set that as the expectation. This level of customer savvy is fairly new and puts a different type of pressure on businesses.

Now, customers are paying attention to the business choices you make and expect them to be thoughtful and informed. Not just based on market trends, but on them, and their wants and interests.

Brands that use their data and customer data management best practices to really understand their audiences are going to come out ahead.

Effective customer data management goes beyond tracking and storing bits of data about your customers. Done right, it actually teaches you about your customers – both on an individual and macro level. And in doing so, it may even teach you about your company, and how to grow it.

3 strategies for unlocking growth via customer data management

Driving business growth by knowing your customer sounds good, but what does it look like?

Here are three examples of how you can put your plethora of data to use.

1. Upsell and cross-sell more effectively
2. Go beyond demographics with behavioral segmentation
3. Identify potential partnerships and expansion opportunities

Customer data management best practices

The brilliant secret is that you can start to employ customer data management best practices today. It’s common sense, attention to detail related to your customer and their data. Do these 3 things and you are on your way:

1. Define your customer—Really dig into who you want your customer to be
2. Unify your data—Simplify things by creating a single place for your data
3. Clean your data—Monitor your data and your definition of your customer, this persistent focus will drive insights.

Upsell with insight

Upselling and cross-selling are often the first strategies businesses look at to drive revenue, and for good reason. In general, it’s easier and less expensive to sell to established customers than scouting out new ones. There’s an established trust and rapport, and you already know what products or services they’ve purchased. Good customer data will only make this tried-and-true growth more effective.

Businesses have used purchase insights to drive cross-sell and upsell opportunities for decades. In the 90’s, British grocery chain Tesco discovered that men who bought diapers at their stores were also likely to buy beer (they could only speculate as to the reason, but they had plenty of theories). I can’t confirm whether that impacted where they placed those items in the store or informed future offers. But I can confirm that a decade later, we were talking about those potential outcomes in at least one college advertising class.

The point is that sometimes, data can uncover patterns we wouldn’t come to on our own, intuitively. Regardless of whether Tesco decided to stock the beer and diapers in relation to each other, it’s safe to say no one would have even considered that line of thinking without the data.

Today, it’s easier than ever for businesses to uncover those hidden patterns. Customer data management tools that use machine learning and artificial intelligence can see trends that the human eye (and intuition) would otherwise miss. From a customer’s purchase history to complaints to social chatter, you never know where the next surprising connection will come from.

That could open the door to some big upsell and cross-sell opportunities.

Personalize based on behavior

These days, personalization is everything. And of course, you can’t personalize your customers’ experience if you don’t have a way of understanding your customers. So if you’re looking for ways to grow your business, it’s worth looking at your personalization strategy. When was the last time you approached it with fresh eyes? Are you using your customer data to its full potential for a truly integrated and deeply personal customer experience?

If not, what you’re calling personalization may not feel all that personal to your customers. And shallow segmentation may be to blame.

Traditional segmentation focuses primarily on geographic and demographic data. It lets you group audiences and personalize communications or offers based on their age range, where they live, etc. Advances in customer data management have unlocked a more in-depth approach: behavioral segmentation.

Behavioral segmentation focuses on how your customers engage with your company, products and services. What words are they using to search through your products? What products are they comparing to each other? (Both of which could indicate what, specifically, they’re looking for.) How often are they browsing? Buying?

These insights tell you much more about the customer than their age and hometown ever could.

Or, as one excellent explanation put it:

“Prince Charles and Mick Jagger are both British men who are about the same age – and if that’s all you knew about them, you might try to show them the same product recommendations. Of course, if you knew a little more about them, or understood their past buying behaviors, you’d offer them completely distinct experiences.”

Using a customer data platform to collect and analyze behavioral data – as well as demographic, social, and every other type of customer data you have – will make your personalization much more effective, and profitable.

Identify future opportunities

Using data to understand your customers on a deeper, more human level offers can also open the door to future growth opportunities. At the very least, you can use your data to predict which growth strategies make the most sense for your current base.

When you go beyond identity and descriptive data and get into more qualitative or attitudinal data, you can learn a lot about what’s important to your customers. Good customer data management lets you do just that.

Those insights can be really powerful. Think about it: what if you began to notice that a huge swath of your customers is really passionate about sustainability? What if you were a sneaker company that realized more customers were wearing your shoes casually as a fashion choice, not just for working out?

No matter how well you know your products and services, it will pay off to understand how your customers use them, and what is most important to them.

It may even lead to some creative and surprising partnerships.

Knowledge is power

Whenever you’re tasked with making a big impact – when the pressure is on and you know people are watching – it’s tempting to hurry up and run towards your next big milestone. But the most effective strategies are thoughtful and based on valuable data and insights. That’s the true value of customer data management best practices. It grants you access to information and insights to drive more effective business decisions.

So start by working with your data. What can it teach you about where your business can go? Then listen, and act accordingly.