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Understanding Customer Behavior and Preferences

a phone screen shows a puzzle of a head with puzzle pieces coming out of it

Wouldn’t it be awesome to read minds and know what your customers are thinking? While Nutshell isn’t capable of the art of mind-reading, we are well-versed in understanding customer behavior and preferences, and that’s kind of the same thing, right?

By understanding customer behavior and preferences, you can better understand your audience and use that knowledge to craft effective marketing and sales campaigns that engage your audience and improve your bottom line.

Keep reading to learn more about customer behavior and preferences and how to identify both with data analysis and your CRM.

What is customer behavior?

Customer behavior refers to how customers shop, including their buying habits and factors that influence their decision to buy something. Three main factors that affect customer behavior:

  • Personal: Personality traits, a person’s background, and their upbringing.
  • Psychological: Perception and attitude — these can change daily, making them hard to predict.
  • Social: External factors like peer recommendations, trends, and social norms or expectations.

How to understand customer behavior

Understanding customer behavior is crucial because it helps you focus your marketing and sales efforts on key customer segments more effectively. One of the best ways to understand consumer behavior is through a customer behavior analysis.

Customer behavior analysis

A customer behavior analysis is a detailed observation of how customers interact with your company at various stages of the customer journey.

To conduct a customer behavior analysis, segment your audience into buyer personas based on shared interests or other similar characteristics like demographics. Then, observe these groups at different stages of the customer journey and see how they interact with your company.

Are they engaging with your company’s page on social media? Are they finding your brand through search engines? Are they attending demos with your sales team?

Lead board in Nutshell

You can access this data through tools like website analytics platforms such as Google Analytics, marketing analytics platforms, and your CRM.

Nutshell makes it easy to track data about your interactions with leads. You can segment customers into groups and see all of your interactions with a given lead in one place. Nutshell even automatically pulls in lead attribution data so you can see where your leads come from.

Why is it important for marketers and salespeople to understand customer behavior?

By segmenting customers into buyer personas and observing them at different stages in the customer journey, you can gain insight into what motives and priorities influence customers during the buying process, as well as the decision-making methods they employ.

Understanding customer behavior allows marketers and salespeople to personalize marketing messaging and content to better appeal to audience segments and encourage customer engagement.

In doing so, your business’s marketing and sales representatives can begin to identify customer preferences to further tailor sales and marketing efforts.

What are customer preferences?

Customer preferences are motivations, expectations, likes, dislikes, and inclinations that drive customers to make purchasing decisions.

Why is it important to identify customer preferences?

Customer preferences are subjective to each individual, meaning that while one of your customers may have a specific set of preferences, there’s no guarantee another customer will have the same ones.

Identifying customer preferences is important because, like customer behaviors, knowing your customers’ preferences helps you to deliver better marketing and sales campaigns. With customer data collected and stored in your CRM, you can use that data to create personalized marketing campaigns that effectively target your customer segments.

Not to mention, identifying and understanding customer preferences helps you to deliver quality customer service to leads and customers on a consistent basis.

Additionally, understanding customer preferences can assist you in future product development by identifying customer pain points and using that information to create products and services that address those customer issues.

How to identify customer preferences

Talking about the benefits of identifying customer preferences is one thing, but actually pinpointing them? That’s another beast altogether. Lucky for you, we’ve gathered a few helpful tips on how to identify customer preferences among your audience.

Read on to learn more about a few different ways you can identify customer preferences and use them to strengthen your marketing and sales campaigns.

Analyze market trends

Sales funnel report in Nutshell

One way to identify customer preferences is to analyze market and industry trends. When looking at marketing and industry trends, make special note of changes in consumer behavior, technology advancements, and economic shifts.

These trends contribute to social factors that can influence customer behavior and, in turn, have an effect on customer preferences.

With Nutshell’s reporting and tracking features, you can keep a watchful eye on customer behaviors that indicate changing trends and behaviors. Then, you can use that insight to adjust your marketing and sales efforts accordingly.

Identify customer pain points

You can identify customer preferences by understanding customer needs and pain points that drive them to make purchase decisions. By identifying areas where customers are not satisfied with current products or services, you can develop new products or services that meet those needs.

Not only are you gaining insight into customers’ preferences and behaviors that drive them to make purchases, but you’re identifying potential new market opportunities. This can spell increased revenue for you!

Use surveys and forms

Email marketing templates in Nutshell

A surefire way to better identify and understand customer preferences is to outright ask them. Use online surveys and forms to collect feedback directly from your customers. 

Nutshell makes it easy to create forms for customer data and feedback collection. Nutshell Forms are customizable and send data submitted through your forms right into your CRM.

With Nutshell Forms, you can gain deeper insight into customer preferences by asking questions like:

  • How did you find out about our product?
  • Do you use our product for business or personal use?
  • How can we further improve our service?

Understand customer behavior and identify customer preferences with the help of Nutshell CRM

When you partner with Nutshell, you’ll always have the inside scoop on your customers’ behaviors and preferences through in-depth reporting, customizable forms, and organized customer data that’s all in one place.

Learn more about how Nutshell can help you understand and identify customer behaviors and preferences by contacting our team or signing up for a free trial of Nutshell today.

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