One thing that can’t be disputed is that if you want to run a successful business, you’re going to need some customers. Many owners of new businesses probably wish there was a magic formula for attracting and engaging potential clients and making them want to purchase their products or services, but sadly it’s not that easy. There are plenty of things that can be done to achieve this of course, but with everyone at the company pushed for time in the early stages, it can’t all be done at once; and it’s often difficult to know which activities will bring the most benefit in this regard.
It’s commonly accepted these days that collecting data about potential customers is an essential ingredient for success, especially in the growth stage where every sale can make all the difference. Alex Farrell, founder of Gift Wink, goes a step further, advising SME owners to be truly fanatical about this data, making it a focal point of their marketing strategy. Citing the example of her previous company, The IT Job Board, Alex says that if used to its full potential, data can have a monumental impact on the ability of a business to grow quickly.
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Data is an aid to effective communication
According to Alex, data is key to optimising sales, especially in the online world. Companies who ignore the opportunity offered by data will be missing out, so Alex suggests giving particular forethought to the kind of data you collect and how you use it once you have it. This requires you to be obsessive about your methods for collecting customer data, as well as the way you categorise it.
Working with such attention to detail requires you to give careful advance consideration to who your target customers are, including any sub-groups, so that you can make sure you’re collecting the kind of information that will enable you to categorise them. Once you’re doing this, you can then present a refined message to each group that will get them interested in your offering.
How The IT Job Board used data to its advantage
When starting out with The IT Job Board, Alex realised the value that data could bring and set about coming up with a way of collecting and using it that would increase the ratio of newsletter subscribers who became paying customers. As she realised through her own experiences, it’s not enough to simply have a list of names and contact details. ‘We had a lot of email addresses in our customer base but not a lot else – not enough data to really engage with those customers and convert them into a transaction.’
Eventually, Alex developed a novel approach that put data at the forefront of a successful growth strategy for the company. She says: ‘We knew that if you had a highly preferenced user in terms of the data you had on them on their email newsletter, they were likely to convert at three or four times what they would if it was just a generic newsletter.’
Alex explains how she was able to profile mailing list subscribers to a high level: ‘We had generic newsletters with key categories that we’d mapped out…when a user got that email and they clicked on one of those categories it would preference them’. The next newsletter would then contain a set of new categories that would enable them to be preferenced further still, and so on. This strategy proved extremely successful, says Alex – recipients of the newsletters ‘were highly converting by the end of the time we’d collected all of that data on them.’
Developing your own data strategy
If you don’t have a strategy for collecting data about your contacts, this is the first thing you should set up, and if you do then it’s time to start refining the kind of data you collect and how you use it. Before you do, really take some time to consider who is in your target audience, what their individual preferences might be, and how you can use this information to provide tailored messages that will be likely to convert them into paying clients. This can be different for every business, and you’ll need to figure out what’s best for you.
It might help to think about who your existing customers are, or even to ask them what key features make them want to use your products or services – once you know what makes you attractive to different customer types, you can then use this information to start categorising the data you hold on your potential future customers.