Consumer Behavior Analysis is here. For everyone.
Understanding your consumers’ behavior and what influences it is crucial for optimizing your marketing and sales efforts
Before big-data analytics became a (huge) thing in the past decade, Consumer Behavior Analysis was a luxury, accessible only to big, budget-heavy brands. Those businesses invested ridiculous sums of money in trying to understand their consumers’ behavior. But the techniques they used were not only very costly but also based on static data and fixed attributes, as opposed to dynamic real-time data.
Fortunately for the rest of us, new technologies and big-data analytics have changed the face of marketing in the past few years. Consumer behavior analysis has become something all of us can perform and benefit from. By asking the right questions and using the right analytics tools, we can now really understand our consumers’ behavior. Once we understand their behavior, we can model and influence it, pushing conversions and ultimately sales. The future of marketing is here!
But wait, what is Consumer Behavior Analysis?
Consumer behavior analysis is a quest to understand the nature of your customers’ choices, how they make their decisions and what influences those decisions. Their decisions can be influenced by personal, psychological or social factors.
The 5 W’s (and an H!) can help explain the insights you can get from this type of analysis:
- Who interacts with your products or services and who influences that interaction.
- What influences their decisions and which social factors influence their choices.
- When they interact, in which situations or at what time of day.
- Where they interact or in which physical space.
- Why they interact, which needs or wants your product answers and why your brand vs. another.
- How they interact, on which device and whether it was through a browser or app.
Here’s an example:
Tina, a 30-year-old single woman from Manchester, UK, is starting to see the first signs of age and is very interested in anti-aging products and cosmetics. Her group of friends share special deals and finds on their WhatsApp group. Tina watches a YouTube channel that reviews different beauty products and usually shares what she likes with her friends, to see what they think. She usually buys mid-range products online, so price and online availability play an important role. Tina usually checks out new YouTube videos at night, before going to bed, when chilling on the sofa or watching TV. She watches YouTube either on her Smart TV or on her iPhone and then checks out the products on her phone, on the browser.
So… why is this important?
Once you understand your consumers’ behavior, what influences it and how decisions are made, you can use that information to influence that behavior and improve your marketing and sales efforts.
Once you really understand your consumers’ preferences (their five W’s and H), you can provide real value through hyper-personalized content. Consumers are thirsty for this added value, and according to Accenture’s 2017 report on global consumers, 48% of customers expect personalized treatment for being a loyal customer. Many of those will abandon a brand if they don’t get exactly that.
In-depth analysis of your consumers’ behavior can also help your business identify early adopters and high-value customers. You can focus your marketing campaigns on this high-value segment, on the device of their choice, when they are most likely to make a purchase. You can further understand your consumers’ reactions to these campaigns and tweak your strategy accordingly. All of these can greatly reduce churn and retain more customers.
So, continuing with our example, imagine that you were marketing your product to our friend Tina and to other people like her after performing consumer behavior analysis. After finding out about her consumer behavior, you would probably choose to present ads:
- For female iPhone users aged 25-35 interested in cosmetics and anti-aging
- For your mid-range, anti-aging products
- On YouTube
- In the late evening
During the campaign, you could see how Tina’s segment reacts and tweak accordingly.
This is, of course, an overly simplified example. Consumer behavior analysis can give you many more actionable insights on your consumers’ decision-making processes. By using these consumer insights, you can get the most out of your marketing efforts and target your highest-quality consumers.
The data challenge
Because consumer behavior is influenced by so many factors at so many touchpoints, getting a clear picture requires data from multiple sources, including but not limited to:
- Social media apps
- Analytics apps (i.e. Google Analytics)
- Ad analytics
- Competitor analysis
- Review sites
Modeling consumer behavior is an ongoing challenge, which usually requires heavy lifting in the data and analysis departments, but with the tools provided today, the ability to conduct consumer behavior analysis is much faster and broader than before.
This is especially true for AI-driven platforms which autonomously gather and analyse the data relevant to you brand, market and consumers. Their tailored insights into the behavior of your customers and prospects are definitely worth the effort. And who knows what the future will bring, and what data it will bring with it?