People in business often quote the 80/20 rule: 80 percent of your revenue is generated by only 20 percent of your customers. To be truly successful, merchants must deliver products and services that this 20 percent—the VIPs—likes. But how do you get inside their brains to know what they’re truly responding to?
Knowing the names of your best customers—everyone appreciates a personalized greeting when they walk through the door—and handing them their favorite item without the need to place an order is great. But in today’s tech-driven world, that’s not enough. Stiff competition lurks just down the street or the next URL away. Small business owners must gain greater insight into their top customers and know how they contribute to their bottom line. Otherwise, they risk losing them to another retailer who better serves their wants and needs.
The power of big data knowledge
Not too many years ago, handwritten sales ledgers contained the names and notes about what was bought scribbled inside. Business owners could flip through these books and highlight the names that appeared frequently, as well as the products that had the highest sales—a time-consuming process that ultimately yielded very little helpful information. That’s pretty much where market intelligence ended. But with significantly less competition—and no internet retailers—this rudimentary level of knowledge sufficed.
Today’s merchants face a drastically different reality. A 21st century business has to deal with 21st century problems, including bad online reviews, obsolete products, and slowing foot traffic. While technology has allowed these challenges to come into existence, it is also making things much easier for business owners.
With the simple scan of a barcode, digitized lists of who bought what are created for shopkeepers. Helpful? Yes. What’s really empowering small business owners, however, isn’t visible on first glance. But technology can uncover it.
Clover’s analytics app Insights is your in-house data analyst. It takes your data, analyzes it, and reveals sales trends, enabling you to know more than ever about your best customers and their buying habits. The exposed information might even cause you to change your opinion of what “best” means.
Insights will ID the person who visits your eatery like clockwork, ordering a cappuccino five days a week, exactly at 8:15 a.m. each morning. That $3.75 sale might not seem that valuable, but as we noted in a previous blog post, a customer’s consistent, small daily transactions can amount to an impressive revenue stream—more than you likely realize. Because the data analysis reveals the level of her loyalty (extremely high!), you now realize that there’s opportunity for a successful upsell. If she picks up a $3 muffin twice a week, the amount she spends will increase by several hundred dollars annually.
Similarly, the app can organize sales data and hone in on regulars who make one-off purchases that have recurring potential. This information would have been difficult, if not impossible, for a merchant to uncover without Insights’ capabilities. At the very least, it would’ve taken hours to mine, whereas Insights does it in just seconds.
In contrast, Insights also highlights the moments a regular customer deviates from his usual behavior—whether he switches to a different item (which could signal that he feels that the original purchase is no longer worth it or is particularly excited about a new product offering) or cuts back on his visits, an indication that he might be defecting. This knowledge gives merchants the ability to proactively reach out, sending an exclusive discount offer or engaging in a one-on-one, fact-finding conversation the next time he pops in.
Small business owners who internalize the data and do nothing with it are minimizing their sales potential. Sure, getting to know your best customers starts with smart data analysis. But to really know your top clients, data analysis must be used to inform clever marketing programs. And guess what, technology can assist with those, too.
Learn the good, the bad, and the ugly by surveying shoppers using the Customer Survey or Feedback apps. They provide real-time feedback on customer experience by printing codes on receipts to entice people to take quick surveys.
Loyalty programs are also an excellent way to recognize and reward VIPs. Clover Rewards gives merchants the ability to create a unique rewards program that alerts consumers to discounts and special offers via email, text, and the Perka app. Delighted customers receive birthday rewards and other unique, free offerings. Reward VIP and regulars by gifting them bonuses.
Other targeted marketing campaigns can further solidify the relationship with your top customers. Clover Promos uses coupons to entice regulars to come in even more frequently, or to return if they’ve been delinquent. You’ll be able to track redemptions in real-time, creating even more data that can provide further insight into marketing best practices—and those best customers.
Clover is sold by leading U.S. banks including Bank of America, BBVA, Citi, PNC, Sun Trust and Wells Fargo. You’ll also find Clover at our trusted partners including Ignite Payments, Restaurant Depot, and Sam’s Club. For more information, visit us at clover.com.[image: More Cafe Bar Restaurant / Trafalgar Street by Dominic Alves on flickr]