Customer Targeting – A New 21st Century Library Skill

Ever wonder what happened to that 20-something person you noticed in the library several times a couple of months ago? What did you know about them? Were they a life long community resident? A student? A parent? How about the older person who just started coming to the library – every day this past week? Did any staff member introduce themselves, or welcome these new customers and try to engage them in conversation?

All of these questions are related to knowing your customers, and as I wrote last January; “The absolute total purpose and focus of the 21st Century Library Model is the customer. Customer centered library services that meet the information needs of the 21st Century customer will result in any library remaining relevant to its community.” [ Customer Is The Purpose] Knowing your customers should ultimately lead to customer targeting. You know – for your marketing efforts. No marketing efforts? Maybe you should re-think that decision.

For decades ‘community needs assessment’ has been a pillar of librarianship, and more recently such undertakings have led to marketing efforts for library services to help improve circulation – the last great 20th Century library metrics. At MyStrategicPlan, “a nationwide leader in on-demand strategic planning services”, there is a comprehensive Post on “customer targeting”, in which they present the idea that…

there are six customer “types” and where they fit into the customer hierarchy. These include:

1. “Endorsers” — (5 percent of customer base) Endorsers are customers who tell other people about your company. Typically, the new customer comes in as an endorser, which you should capitalize on.

2. “Buyers” — (15 percent) A buyer will continue to buy from you, often exclusively, but no longer aggressively endorses your company. Maybe an invoice was incorrect or a shipment was incomplete. If one negative incident moves your customer from endorser to buyer, it may take 15 positive incidents to get him or her back as an endorser.

3. “Satisfied mutes” — (30 percent) These customers don’t talk to you and you don’t talk to them. If you ask one of them how the business is doing and they answer, “Fine,” that’s all you know.

4. “Dissatisfied mutes” — (30 percent) This customer has migrated from the ranks of satisfied mutes, but you don’t know it. That’s because no one is talking to anyone else. At this stage, it will take 60 positive incidents to make this person an “endorser” again.

5. “Grumblers” — (15 percent) You know these customers: no matter what happens, you can’t do anything right for them. They’ve experienced too many negative incidents. In essence, they have become “martyrs.”

6. “Complainers” – (5 percent) Though small in numbers, this type of customer can be deadly. They make a point of telling everyone how badly your company has treated them. They are not your friends.

Don’t these descriptions sound spot on to your library customers? Did you note the part where 95% of your customers are NOT endorsing your library? Did you note the part where 50% of your customers are NOT totally satisfied with your library? Do those seem like issues that might be worth addressing?

MyStrategicPlan goes on to discuss the various types of customers and the type of communication each needs.

I use a strategic approach called Customer Lifecycle Management (CLM) that identifies and segments customers based on their behaviors, attitudes and experiences with a company. When implemented successfully, this results-driven strategy also helps companies reduce wasted marketing expense and uncover “hidden” revenue.

Identifying and managing the needs of each customer segment is critical in determining the amount and types of communications spent for each group. For example, new customers typically need to be welcomed and educated about the range of products and services an organization has to offer, whereas current customers (who have bought products and/or services in the past) benefit more from cross-sell messages. Similarly, a portion of customers who are at risk of switching allegiances to a competitor might be well served with some sort of retention intervention, while others who remain devoted to an organization, regardless of competitive forces, should be rewarded with a loyalty message.

Customers are not all alike. Treating all customers in the same manner, without regard to the customer lifecycle, is a sure-fire way to limit potential revenue and profitability. As an example, look at two customers at a health club:
• Customer A is very active at the club. She typically uses the facilities five times a week, often buys supplies and apparel in the pro shop, and has referred four people to the club in the past six months.
• Customer B, on the other hand, has not been seen since the day he joined the club nine months ago.

Membership renewal fees for both Customer A and B are due in three months. If the club uses the same marketing strategy to encourage Customers A and B to renew their memberships, it will probably spend more money than is necessary for Customer A, while not communicating enough benefit to Customer B, eventually losing this customer anyway.

Either way, utilizing the same marketing approach will cause a decrease in potential sales and profitability. Thus, a more segmented and targeted approach to sales and marketing is needed.

When you communicate with your customers, does your message address ALL of them, or target a specific segment of them? Doesn’t it seem reasonable that different library customers will respond to different messages? Not every customer is interested in every service you offer. When you think about your library customers, just think about yourself as a consumer. What message or ad would appeal to you? Would that same message or ad appeal to your spouse, parents, and children?

The MyStrategicPlan website goes on to discuss in much detail issues such as stages of customer behavior, targeting customers based on data, the four P’s, market research, and other related issues. It is well worth reading for anyone serious about revitalizing their marketing efforts.

One excellent piece of advice from MyStrategicPlan is doing your own research.

I’ve found over the years that even entrepreneurs without much of a budget can successfully perform quality research if they are creative, resourceful, and brave. Entrepreneurs on a budget may feel unable to apply formal market research techniques, but a simple four-step process can be effective:
1. Determine how to perform the research (one-on-one interviews, focus groups, surveys).
2. Develop the research instrument (interview questions, survey questionnaire, hands-on tasks).
3. Identify and recruit participants.
4. Understand what will be done with the results of the research.

The type of business you’re in will dictate the most appropriate approach. … If your product is aimed at a mass market, it may be more beneficial to recruit small numbers of people for focus groups until you have a feel for the market, and then validate it further using a survey.

Do you know your library customers? Do you want to increase your presence in the community? Do you want to increase the number of customers who use your library? Do you want to appeal to that 50% of your customers who are NOT totally satisfied with your library? Would you like to make more of your customers into “endorsers” for your library? Doesn’t customer targeting seem like a strategy that might be worth investigating?

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