Customer Profiling revolves around understanding the reasons that underlie 'formation', 'expansion' and 'dilution' of customer base of the company. Stepping into these details will offer answers to the much troubling questions organizations have to deal with, such as 'why do we have a low customer retention ratio?', 'what should we offer to customers to make them recommend our product to their relatives?' etc. One can obtain solutions to these by employing a 'tracking tool' like BSC (Balanced Scorecard). The perspectives that can be of help are- 'Benefits and Performance Perspective', 'Process Perspective', 'Buying Behavior Perspective' and 'Integration and Best Practices Perspective'. The indicators for Performance and benefits and Perspective can be 'customer retention ratio', 'issues addressing index', 'customer base expansion' and 'cost: revenue ratio'. The next area is process perspective. The parameters can be- 'number of areas covered', 'number of techniques utilized', 'number of technological solutions used' and 'time taken to conduct the complete study'. Integration and Best Practices perspective can be evaluated via the metrics like 'staff fraction', 'database alignment' and 'best practices abiding ratio'. Buying behavior perspective can be had with indicators like 'proportion of customer base which showed an increase in frequency of buying', 'customization climbing' and 'increase in sales per customer basis'.
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Seldom does a company produce such a product or provide such a service that works for 'everybody' on this planet. In other words, the offerings from organizations are prepared with a definite set of people in mind who will be using it. To carry out the job of segmentation effectively, one needs to make a clear 'profile' of the customer base that will be built.
An honest and useful shopper profile can be developed by using characteristics like demographic, geographic and psychographic.
For instance, to decide whether a particular magazine be used for advertising or not, the company can consult the magazine advertisers to know the age-group from which the readers of that magazine belong. In case the product is for readers falling into the age-group, one can go ahead with the decision. This is one of the ways one can get an idea about Customer profile analysis.
Working on customer description is one of the most important tasks of marketing people and has to be performed to create a useful prospect list.
By moving on the path of 'buyer profiling' with enough detailing, one can have the causes that make up for the 'construction', 'spreading' and 'degrading' of customer base. Further, indicators that mirror the changes in the area of customer mapping can be framed and followed to keep the organization on track.