Customer sales always play a significant role in any business.
Hence to understand your customer’s behaviors and to better allocate resources to different customers for generating the highest profits we feel like one of the leading vendors of sales CRM software for small business it is utmost necessary that businesses irrespective of their size and industry must be able to identify and thereafter segment different types of customers using a business CRM tool.44% of businesses are planning to increase IT budgets in 2021, up from 38% in 2020. This is not just to keep up with their competitors, but also as a result of improving sales.- SuperOffice Click To Tweet
This is because it is only by better understanding the different types of customer sales, businesses can be better equipped to develop effective and successful strategies that can help in rapid business growth.
What are the Different Types of Customers?
In the retail industry, consumers can be divided into five main types which include:
1. Loyal customers: Even though these customers make up a smaller percentage of customer sales, nevertheless this customer base generates a large portion of sales and revenue.
2. Impulse customers: These customers do not in general have any specific product or services in their mind but they purchase when it seems good at times.
3. Discount customers: These customers shop frequently but base their valuable buying decisions primarily when the market is down.
4. Need-based customers: These customers come with the intention of buying a specific offering.
5. Wandering customers: These customers are not sure of what they want to buy.
Type #1 – Loyal Customers
The loyal customers are the most important segment of the customers that all businesses must appease and should keep on top of their mind.
According to research, it has been noted that this type of customer, in general, represents no more than just 20 percent of any company’s customer base. Nevertheless, they contribute to the majority of sales revenue.
As the name suggests loyal customers are not only loyal but they even value a product or service heavily.
Additionally, loyal customers are more likely to recommend their preferred brand’s products and services to other people.
Hence it is important to always solicit their feedback and inputs and even involve them in a company’s decision-making process since heavy emphasis must be placed on loyal customers if a company wants to grow rapidly.
Type #2 – Impulse Customers
After the loyal customers impulse customers are the best customers to upsell and so are the most attractive segment in the customer-base to focus on.
These customers do not have any specific list in their mind and buy products and services spontaneously.
Additionally, these consumers are typically open and receptive to recommendations on new offerings.
Hence these customers are second to loyal customers in the generation of revenue in sales and so keeping impulse customers in the loop on new offerings goes a long way in boosting a company’s profitability.
Type #3 – Discount Customers
These customers in your CRM database play an important role in turning over a brand’s inventory. Hence discount customers are a key contributor to a company’s cash flow during holiday season sales or while implementing Christmas sales strategies of a company.
As it has been observed discount customers seldom purchase at full price and mostly shop around when the markets are down.
Now, these customers are resistant to upselling and are also the least loyal type of customers, that typically move on when they find better markdowns – elsewhere.
Type #4 – Need-Based Customers
These customers are typically driven by a specific need.
In other words, these customers enter the retail stores and online e-commerce portals quickly, buy what they require, and leave.
Need-based customers only purchase for their specific need or occasion and so are hard to upsell.
It is critical to note over here, that these customers can be easily drawn by other businesses both in B2B and B2C market landscapes.
Hence it is important that brands must initiate positive personal interactions with this segment of customers in order to retain them for a longer time.
Additionally, converting need-based customers to loyal customers is very much attainable with the right positive personal interactions and nurturing that can be fostered with the help of an easy to use CRM tool.
Type #5 – Wandering Customers
Finally, wandering customers are the type of customers that draw the largest amount of traffic and footfall to the company. Nevertheless, they make up the smallest percentage of any brand’s sales revenue.
This is because wandering customers do not have any specific requirement nor desire in their minds and are mostly attracted by the location of the business more than anything else.
However, these types of customers in the retail shopping marketplace enjoy the social interactions of their shopping experiences.
Hence investing too much time trying to please this segment of the customers can draw your business away from the more revenue-earning segments.
Now even though wandering customers generates the minimum amount of sales revenue, providing intuitive and insightful information about your offerings to these customers can stimulate interest which can ultimately create customer sales resulting from a purchase.
Conclusion- Flexibility Is The Key
The most important thing to keep in mind is that you will probably never meet a lot of customers who will perfectly fit one of the aforementioned types since most of them will be a mix of different sorts of personalities.
Hence even though it can be difficult to personalize your customer service efforts for each individual types, nevertheless, as a vendor of CRM for SMB we suggest that the best strategy is to get to know these five core type of customers, recognize the customer your are dealing with and thereafter adjust your communication strategy based on our business growth ideas accordingly.