These insights come in handy when outlining whether or not your customers are aligned with your business goals and making more-enticing optimizations to hit better results. This might seem like a pipe-dream but with a customer behavior analysis platform in place, you can nail it.
In this blog; we’re going to walk you through the techniques you need to implement to have a better understanding of your customer behavior, as well as, the tools and mindset you need to equip in order to get started.
Why is consumer behavior important?
Well, simply put: understanding consumer behavior is important because it helps merchants to recognize what influence consumers’ buying decisions.
By understanding how consumers make their decision, merchants can easily fill the gap in the market and learn how to present their products or services in a more appealing way that generates maximum revenue.
Through consumer behavior analysis, merchants and marketers should know:
- How consumers think and what they feel about (brands, products, etc.)
- What influences them to decide on various options
- What role does his surrounding environment play that could influence his decision (friends, family, social media)
- What they need to focus on in order to maximize profits and higher customer lifetime value (Marketing campaigns, SEO-Friendly website, etc.)
Mostly, brands succeed to influence their consumers’ behavior only when they understand their motives to buy and what controls them: think about a cosmetic brand like Sephora, they know how to influence their customers and drive them to buy more products than they intended each time they go to their stores.
So let’s spice up your drab before diving deeper into how to predict your consumer behavior and break down the 3 key categories of factors that influence consumer behavior:
Consumers’ behavior can be affected by several personal factors such as individual opinions, values, tendencies, and morals. Similarly, it can also be influenced by his own demographics (age, gender, environment, etc.)
2. Psychological factors:
Crafting the right messaging that conveys to your audience through your marketing campaigns is a huge pillar and can play a vital role in influencing their buying decision. Customers usually get convinced depending on their perceptions and attitudes, this is what mainly make them change brands or opt for other alternatives.
3. Social factors:
Economic conditions, family, friends, income, and education level, all of these play a big part. A high income can make people more willing to indulge in purchases regardless of their financial liabilities.
How to predict consumer behavior?
Create a sophisticated buyer persona
You can start off by creating a robust buyer persona. This means you’re not only supposed to tap into their demographics such as gender, age, location, interests, pain points, etc. But you should also identify the characteristics of your valuable customers. One way to do this, is to calculate the customer lifetime value. It’s a metric that measures customer lifespan, purchase value, and frequency rate, then indicates how much revenue the business can expect from each customer.
Put your take on the insights
Ask yourself some questions to determine what affects your customers’ behavior, is it an urgency factor or does the customer make that purchase decision out of convenience? How much is he willing to spend on your brand? how much time does he need to take before ordering? What roadblocks they might be facing throughout the interaction with your brand? These questions are a great way to understand how your customers think and what exactly you need to improve the customer experience. You won’t be able to answer these questions without a solid data analytics platform that will provide you with detailed and accurate insights.
Generate data from customer analytics
To understand how customers interact with your brand, you have to put on top of mind that every action your users make even if it’s as simple as navigating your website can yield valuable insights into consumer behavior. Starting from clicking on a link, navigating through your website, to making their purchase decision.
There are various resources to gather data from such as social media insights, email subscriptions, consumer feedback, and competitor analysis. Or even a third-party tool that provides you with remarkable information like Google Analytics. It can gather insights such as time on page and bounce rate.
By doing so, you’ll form a big picture of how to predict your consumer behavior. Hence, you can start rolling out new initiatives and steering away from what’s not adding enough value to your customers. It’s also very important to continuously analyze your results after updating your techniques to ensure you're capturing new trends that are hopping on the customer's journey.
Looking for some help in conducting your consumer behavior analysis? Zeal can be of great help by providing you with automated dashboards and advanced analytics to understand the unique and dynamic customer buying journey and capitalize on it. Get in touch now!