Economics/Business

Who is a customer/Concept/How to segment/types/Importance

The customer is an individual or company that purchases your organization’s products or services. It is an agent of fundamental importance in a Lean 6 Sigma project , since it is he who determines the expectations (regarding their service, their delivery, their technical skills, etc.) for the performance of their processes.

In this way these can be broadly categorized as:

  • Business to customer (B2C) , for example, when a person buys groceries in a store; 
  • Business to Business (B2B) , for example, the hardware store uses the service of an accounting firm to file its taxes;  
  • Customer to business (C2B) , for example when an individual sells their vegetables to store; 
  • Customer to customer (C2C), where customers sell goods to each other, for example in e-commerce, and then a consumer sells his product to another consumer. 

Who is the customer?

Identifying who your customer is is a basic principle for the success of your business. However, this identification is often not as clear and objective as it should be.

Surely, you’ve heard of internal customers and external customers, haven’t you? Care must be taken with classifications of this nature.

According to the ABPMP (Association of Business Process Management Professionals), a customer is only one who benefits from the generation of value and is external to the organization. Internally, what exists are process actors or other processes that are logically linked, but should not be considered clients.

Therefore, these are not employees of the company, but are affected by the company and can define the requirements of the product or service.

Thus, it is the role of organizations to understand the needs and expectations of the customer, in order to design their products and services well. Customers will weigh the value of the product based on cost, quality, availability and features. Therefore, it is important to know the Voice of the Customer (VOC).

The following are the different methods for collecting customer information: 

  • customer surveys; 
  • samples;
  • customer complaints
  • face-to-face interviews.; 
  • performance table; 
  • market research 

Thus, organizations must review the information collected from the Voice of the Customer and identify customer needs and current market trends. Trends will help organizations find innovative solutions to retain customers. Customers seem to be more satisfied when suppliers collect feedback and implement changes suggested by them, rather than not being asked for supplier feedback.

Customer Concept

In most contexts, a customer of an entity is considered to be anyone who decides to purchase a particular good or service offered by that entity. Thus, it is possible to distinguish between the direct customer (the one who buys directly from the entity and who may be an intermediary or distributor) and the final customer (the one who buys to satisfy a need for himself or someone to whom he offers the good – for example a son).

This must also be distinguished from the concept of consumer, which are not necessarily coincident – ​​in a situation where someone buys to offer, the customer is that someone who buys while the consumer is the one who actually consumes the good offered.

Another important distinction is the distinction between the customer and the payer. From a commercial or marketing perspective, the customer decides the purchase and not necessarily who pays for it. This distinction is important in the case of products intended for children and young people. In many situations, it is the child or young person who decides (or has a decisive influence on) the purchase, and this must be considered as the customer, although the person who pays may be the parents. In a purchase of baby products, the decision makers will be the parents, although the consumer is the baby, so the parents and not the baby should be considered as customers.

How to segment customers

Customer segmentation provides a view of the market landscape, revealing customer characteristics that can be used to group customers into segments that have something in common. 

This process is also known as bundling . 

These are also categorized based on demographics (such as age groups, geographic location) and industry types. Typical segmentation includes

  • geography: data such as region, neighborhoods, city;
  • demographics: age, sex, family size, income, occupation, race; 
  • buyer behavior: heavy user, aware of need, status, loyalty to your product or service; 
  • volume: grouping based on product usage (heavy user, medium, light)
  • marketing factor – brand loyal customers 
  • product space – customer perception comparison 

Customers can be divided into commercial customers or consumer customers. Commercial customers can include for-profit and not-for-profit companies. The consumer customer consists of a large number of customers with small purchases compared to business customers. 

Customer service

Customer service is the act of taking care of the customer’s needs by caring for and providing high quality professional service and assistance before, during and after the purchase of the product or service.

Senior management periodically monitors customer service activities in the organization and needs to listen to you, provide training, monitor response metrics, and communicate improvement activities in the area of ​​customer service. 

Among the advantages of customer service, the following stand out: 

  • existing customers are more likely to buy based on the services provided by the organization; 
  • improves customer retention; 
  • excellent customer service results in reduced complaints; 
  • improves the company’s brand equity; 
  • improves employee turnover
  • opens the opportunity for new business or partnerships;

customer loyalty

Customer retention reflects the state of mind customers have about an organization and its products or services when their expectations have been met or exceeded. This state reflects the lifetime of the product or service experience.

Successful customer retention efforts indicate an organization or brand that understands and meets the needs of its customers. 

While many organizations traditionally invest resources in acquiring other companies as a quick and effective way to increase their revenue, customer retention is more cost-effective than customer acquisition. 

Customer retention benefits include: 

  • cost reduction in acquisitions; 
  • increase in customer base;
  • makes relationships profitable; 
  • creates more word-of-mouth publicity;

Consumer loyalty and final thoughts

Customer loyalty indicates the extent to which customers are engaging with a company’s products or services and how strong their tendency is to select a brand over the competition. 

Loyal customers are arguably the most important factor in achieving business success. Loyalty success creates repeat business and more opportunities. The main strategies for increasing customer loyalty are keeping them personally and always accompanying them on their journey.

10 types of customers 

We have an article published about 5 types of clients , but, due to the great importance of this topic, we have separated 10 more examples so that you feel more confident when setting up your strategies. Check it out below:

1 – Confused customer

That customer who, in addition to being indecisive, is totally lost in the face of the various options available. He is also usually unable to express himself objectively and may be a little insecure or confused when explaining what he wants. 

WHAT TO DO:

Be patient and ask simple questions to understand what the customer needs. With the answers, you can analyze them and have the best solutions for the consumer’s problem. To avoid disorientation and loss of focus, it is interesting to limit the number of options. In addition, conveying security and confidence during service makes this confused customer more relaxed and certain that their obstacle will be resolved. 

2 – Rushed customer

The hurried customer is recognized for being restless, impatient, and constantly checking the time. By looking for fast service, this type of customer can be a little difficult to deal with.

WHAT TO DO:

Be objective and show that you value their time. Usually, he’s already decided to go to the store. Therefore, it is not necessary to point out other options that are not related to what is desired. Also, when passing on information, do it briefly. In this case, prioritize the essential information.

3 – Communicative client

Generally good-natured and friendly, the communicative customer likes to chat. This makes the sales process more time consuming, diverting precious time to serve other customers or perform necessary tasks. But don’t be fooled: although it seems easy to deal with, in some cases the sale is not guaranteed. 

WHAT TO DO:

Use the power of persuasion and quality service to convince him to take something. Another tip is: act in the same way as the customer – be communicative, but avoid parallel topics and bring the consumer to the course of the conversation that will trigger the purchase, in a polite and attentive way. 

4 – Non-communicative client

He is the opposite of the communicative customer: the non-communicative customer can be a mystery to agents. In a nutshell, from gestures and body language, you need to read correctly to identify what he’s looking for.

WHAT TO DO:

Ask questions that allow short or monosyllabic answers, anticipate doubts, be proactive and create a range of solutions provided for such a situation. These are the best ways to deal with the non-communicative customer. This makes it easier to form an environment conducive to a successful sale.

5 – Competitive customer

If a consumer comes in talking about a competitor and looks for reasons to change his mind, you are dealing with a competitor’s customer. He is likely to reinforce your opponent’s benefits and wants you to outdo him with your offer.

WHAT TO DO:

To serve a competitor’s customer, you need to know how to argue in your favor. Highlight the differentials of your product or service and focus on its strengths (such as the most qualified service) to bring it to your side. In addition, you can also offer advantages such as a discount on the first purchase or a free trial period of your services.

6 – Specialist client

More difficult type to approach, the specialist customer has more knowledge about the product or service than the sales team itself. It is the person who researched before contacting you and, therefore, it is likely that he has compared the product or service with several references, in addition to knowing details.

WHAT TO DO:

The best way to serve you is to be prepared for the challenge. Feel safe, know the information about the merchandise and avoid giving the impression that the specialist customer knows more than the business itself.

7 – Informal customer

The casual customer feels comfortable with the attendant, treating him as if he were an old friend. You have to be careful when dealing with all the intimacy and freedom he uses. 

WHAT TO DO:

In that case, avoid the familiarity offered and keep your speech honest, transparent, and practical. As in the case of the communicative customer, direct the conversation towards the purchase of the merchandise so as not to deflect into a personal conversation. 

8 – Rude customer

This is one of the types of customers that pose the greatest challenges for the seller. The rude customer has probably had a bad experience with the company and feels wronged. He doesn’t miss the opportunity to complain, to say he’s right or to argue about anything. 

WHAT TO DO:

The best way to deal with him is to stay firm, serious, and ignore his rude comments. Keep the tone of voice appropriate, try to understand why you are being rude and focus the conversation on your need to buy.

Other tips are to let the customer talk (as this is a way for them to release irritation), try to calm them down with phrases like “You’re right” or “I’ll do what I can” and act succinctly and with cordiality. 

9 – Customer who only says “yes”

This one, from the list of types of customers, wants to feel accepted and is usually willing to spend more with whoever welcomes him. At first, he may seem easy to deal with, but you need to earn his trust before closing a sale.

WHAT TO DO:

Some strategies to better serve the customer who only says “yes”: dedicate yourself to receiving them well, be a true consultant to understand their needs, avoid showing products or services that have nothing to do with them (they are likely to say “yes”, but he may regret it in the future as he didn’t solve his real problem) and explain all solutions in detail. 

10 – Brand-loving customer

The number 10 of the types of customers is the target of desire of any company, this customer promotes the brand efficiently, often without generating costs for the business. Through public statements through social networks or word of mouth, he is the great ambassador of your brand. With that, it seems to be simple to deal with this client. However, you need to keep them motivated to continue being a lover of your brand. 

Importance of customers for marketing

Therefore, customers are very important to any business because, from a marketing perspective; what is sought is to achieve an exchange of value between companies and their markets.

Consequently, what the company intends, using the proper use of marketing, is to deliver to customers a product that allows them to satisfy a need, in exchange for making a profit. We then realized that the only way to make a profit for a company is to satisfy customers.

Marketing and customer relationship

Marketing, therefore, deals with two priority objectives in relation to its customers, and these we summarize as follows:

1. Attract new customers

Any company that expects in the near future to have further growth and increase its market share must strive to gain new customers.

New customers become your source of opportunity to grow and be profitable.

To attract new customers, companies must offer superior value, which is able to convince the customer that the product they buy from us offers added value, which surpasses the offers of the competition.

2. Keep current customers

The customers that the company currently has are a very valuable asset; mainly to maintain the level of total market share.

Current customers do not help the company to grow further, but they allow market share to continue to be maintained, ensuring that they continue to make a profit.

To retain current customers, companies must achieve full customer satisfaction, not only by delivering excellent quality products, but also by providing a level of service that keeps them satisfied and they don’t want to leave us.

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