Customer Behavior Modeling Can Drive Business Growth

When looking to identify the different types of customers you have, getting the answers for these questions can seem like a daunting task, but customers are more alike than we think they are. I've heard it said that customers, like snowflakes, are all different, but that also like snowflakes, many are extremely similar.

There are three parts to identifying customer types: (1) defining customer categories; (2) defining customer dimensions; and (3) creating customer personas.

Customer categories are useful for broadly sorting the types of customer you have. For example, if you're Microsoft, your customers fall into three categories: home, business and PC manufacturer. You can further breakdown those categories into subgroups, to get a better understanding of different segments:

Breaking customers down into categories is fairly straightforward, but it isn't the end of the exercise. The second part of this process involves segmenting them into dimensions.

How many dimensions are there? The list is unlimited. However, most dimensions fall into one of these dimension types:

PSYCHOGRAPHIC: Attitudes such as environmental awareness, political tendencies, mind-set about money, health, etc.

LOCATION: Where the person is located.

INTERACTION PREFERENCES: How they prefer to interact—web versus store versus phone, etc., as well as preferred language of interaction.

RELATIONSHIP STATUS: Are they already your customer? How often do they buy? Not yet a customer? Customer of a competitor? Former customer? Member of your loyalty program?

BUYING STAGE/TIMING: Where is the customer in the purchase decision life cycle (awareness, evaluation, consideration, contracting, post-purchase, renewal consideration); alternatively, what is the urgency of their purchase?

AFFINITIES: Hobbies, tastes in music, food, culture, sports teams, celebrities they have a special connection to, and so on.