How to Use Consumer Insight to Turn Prospects into Customers
When you visit a Starbucks, what is it that you’re actually buying?
Most people would say that they’re buying a cup of coffee. And that makes sense. After all, according to Starbucks, the company sells about 4 billion cups of coffee each year.
Despite all that, the truth is that Starbucks is not really in the business of selling coffee. Instead, they’re in the business of selling an experience – and the coffee is only part of that experience. The rest of the experience is made up of a variety of things, which include the following:
- The aroma of the coffee
- The trendy music playing in the background
- The upbeat and possibly over-caffeinated greeting from the barista
- The sound of the coffee grinder
- The feeling of being slightly hip and cool because you go to Starbucks
- The color of the wood used on floors and furniture
- The design aesthetic of the logo, the layout, and the typography
The cup of coffee you’re holding in your hand is only a small part of what you’re buying when you visit Starbucks. What you’re actually buying is an experience – which is part of what has made Starbucks so successful over the past several decades.
Why is this important? Because Starbucks has figured out that selling the product at retail is about much more than just pushing coffee. It’s about understanding prospects and customers at a deeper level, and then using those insights as a way to improve the experience and grow revenues as a result.
With all that in mind, let’s take a look at three steps you can take to use consumer insights to convert prospects into customers.
Step 1: Getting Inside the Mind of Your Prospects and Customers
The starting point is to get inside the mind of your customers and think backwards from there. Ask yourself what it is that they’re actually buying from you. In addition to your product or service, they’re probably buying something that fills an emotional need.
Think about soap. While it’s true that people who buy soap want to be clean, they also want something else. That could be a feeling of confidence they get when they feel refreshed and clean. It could be the desire to stand close to someone they have a crush on. Or it could even be memories they have when they smell the soap they’re using.
When you take a deep dive into what it is your customer is actually buying, you can leverage that insight to be sure you’re delivering everything that they actually want and need.
Step 2: Understanding that the Experience Doesn’t End with the Purchase
If you’re a retailer, you work very hard to drive people to your store. You work just as hard to get them to buy your products or services when they’re in your store.
But what about the after-store experience? How good is that? After all, if you’re going to work hard to sell them something, you should also work hard to make the complete experience – from the very beginning to the very end – as enjoyable as possible.
Many retailers overlook the post-purchase part of the experience. They think that once the customer leaves the store, their job is done, but that’s not entirely true.
After the purchase, customers actually revisit your store when they use your product or service. It’s during that time that the value you bring to them is reinforced. If the complete experience from pre- to post-purchase was as good as possible, they’ll be back. If it wasn’t, they won’t be. So keep in mind things like packaging, wrapping, customer service, and customer surveys when you’re developing your complete customer experience.
Step 3: Using Data to Derive Insights About Your Prospects and Customers
We live in a data-rich world. That’s the good news. The bad news is that many retailers don’t fully embrace consumer insight data as a way to grow their sales and revenues.
Part of the problem is that many business owners think of data as a wall of numbers on a spreadsheet, but that’s not always the case.
Take a look at the visual information below. It shows a foot-traffic comparison between two different retail locations on two separate days.
The data was used to find out which option would make a better location for a new retail store. In a split second, it’s easy to see that the Pleasant Valley Way location is the better option.
You can also use a consumer insight tool like this for information on where your customers are coming from, what type of mobile device they’re using, and demographic data like age and gender.
The Last Step: Turning Insights Into Revenue
All the data and insights in the world won’t do you any good unless you put them into action. So, whether you’re getting inside the mind of your customer to figure out what it is they’re actually buying, or using a tool like SAP Digital Consumer Insight to analyze consumer behaviors, the key is to put it into action. Once you do that, you’ll be well on your way to a successful business in the years to come.
Learn how to confront and solve seven of the most common problems all retailers face with this free eGuide from SAP.