Four Types of Customers and How to Keep Them Happy

Four Types of Customers and How to Keep Them Happy

I’m a regular buyer from a popular high street brand. Every month, I spend probably £30-£50 with them using my store card. My husband has a store card too but he can go many months without buying anything.

The trouble is, he gets lots of discount vouchers to encourage him to buy more. Little do the high street brand know that I live in the same house with him. I don’t get vouchers, they think I don’t need them because I buy without being nudged. It kind of annoyed me so I buy less from them, and alas, discount vouchers addressed to me have started arriving!

As a marketing professional, I have a good idea what this brand has done. They’ve used customer segmentation techniques to divide their market to allow them to push more sales to potential high-value customers and inadvertently ignored already high-value customers. I don’t know if they’ve taken the right approach as I don’t have enough information about their customer base.

Using customer loyalty and lifetime value, here are four types of customers you will find in your growing business and some ideas on how to engage them:

Type 1 Customers - Supporters in business YO! Marketing

Type 1 Customers: Supporter Sam

The Supporter champions your product. He is a current or previous customer who had good experiences working with your company or product. They are loyal and will tell their peers about you, recommending you whenever possible.

However, they often have a low lifetime value due to tight budgets or slow sales cycles. They might not buy regularly or might not renew their services with you at the end of a period. But if you have treated them well, they could be your biggest champions. For instance, these customers are a rich source of case studies and testimonials.

Keep these customers informed of new products and services. Invite them to customer update meetings, add them to your email list, your advisory board and support them as they use your products/services even if they might not buy more in the short term.

Type 2 Customers - Partners in business

Type 2 Customers: Partner Patsy

Partners love your company and your product. They are also a high-value customer that provide your business with many opportunities for upselling.

These customers are likely to be medium-sized organisations that have grown with your business. They are unlikely to have a centralised structure so decisions are made quickly and locally. This is your dream customer because they not only buy but they also recommend you to their peers.

Give these customers a single focal point for their support needs e.g. a dedicated account manager or customer support executive. Officially ask for their input to your product roadmap. These customers will be demanding if they are spending a lot with you. So keep them in the loop on any changes to your business or service in advance. Remember that the main champion of your product/service within their business needs to keep advocating for you so give he or she as much help as possible to do that.

Type 3 Customers - Celebrities in business

Type 3 Customers: Celebrity Charlie

Celebrity customers are a tricky group to manage. This is because they are high-value but they are not loyal customers. They sometimes buy on impulse or they buy because there were no other options.

However, they will not easily agree to give you testimonials. A case study is almost impossible to get from this customer, no matter how good your product or service is.

Ensure that you provide the best customer experience possible throughout the buying process but don’t spend too much overhead on keeping them unless you get an inkling that they are potentially Partner Patsys. Provide existing use cases and case studies to highlight your credibility with this customer. Many Celebrity Charlies end up being Partner Patsys if you can provide a great customer experience, support and a differentiated value proposition.

Type 4 Customers - Ex in business YO! Marketing

Type 4 Customers: Ex Eric a.k.a The Ex

We all know these types of customers. And they are great to have in the business for a time but they tend to cost more than they bring in.

They are usually low-value, meaning that they don’t spend much with you and their long-term financial outlook suggests that they will not be in a position to increase their spending. They are not loyal either, which makes them different from Supporter Sam. Ex Erics will usually ask for a significant discount and will be motivated more by price than value.

Keep Ex Eric happy by bringing him on board with a discounted offer. Then show him the value you can bring his business in terms of extra perks and support. Avoid spending on unnecessary expenses to acquire this client because customer lifetime value to customer acquisition costs will be very low, and hence unsustainable. For instance, don’t pay for sales people to fly to another country to meet this customer. Offer a video conference instead.

Any there any other types of customers that you can think of? Tell us in the comments.

All ilustrations by Yekemi Otaru
Feature photo credit: iStock/Getty Images

3 Ways businesses conduct customer-focused market research

3 Ways businesses conduct customer-focused market research

Beulah Iriele is a Director at Soteria Business Services Limited, a UK-based business consultancy  working with businesses to implement their growth and transformation objectives. Follow on twitter @SoteriaBusiness

Market research as we know it, is becoming more challenging for businesses. It is becoming increasingly difficult to predict what consumers want or would pay for due to the unprecedented disruption happening in various markets.

A Post-Truth Era

In 2016, various sectors including the political and social arenas, experienced seismic changes to known and predictable patterns. Many say this was because the world may have moved into something the Oxford Dictionary terms as the ‘Post-Truth Era’. The Post-Truth Era signifies an era where feelings or emotions are prioritised above facts. Businesses could find it challenging to perform market research. Just collating facts relevant to their markets through the old way of conducting market research will not be sufficient. Therefore, businesses might need a customer-focused approach.

Customer-focused market research

Here are 3 ways businesses can perform a customer-focused market research

Engage in customer exploration

This is not only about getting feedback from customers through surveys and questionnaires. It also involves observations and one-on-one customer contact. This will help businesses understand how customers feel about your products and services. Businesses should not rely on the number of likes or followers on their social media page. Meeting customers one-on-one could help give first-hand feedback. It will also help to capture more than what customers say in their surveys and questionnaire responses.

Pilot new services or test new product prototypes

Within given markets, observe customer reactions to products or services. Observing rather than waiting for responses from feedback forms will enable businesses to understand the underlying feelings of reception or rejection of these products or services. This technique will also enable further probing into these feelings where necessary.

Focus research on the underlying factors accounting for customer loyalty

Customers often stay loyal to products and services that appeal to their feelings. Focusing on these factors will help businesses understand what drives adoption and customer loyalty through market research. For example, most people who own Apple brand products do so because they feel that they belong to some sort of elite club. Therefore, they remain loyal customers to maintain that feeling. Subsequently, Apple ensures that their products continually appeal to this feeling of elitism putting a lot of focus on Customer Intimacy as a value discipline. What other ways can businesses move from the traditional research methods to a customer-focused approach? Let us know what you think in the comment section.

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