Drawing a Clearer Picture of the Online Customer

Marketers must find a way to bring clarity to the picture of the online customer.

As online shoppers gain experience, their behavior, responsiveness, and sensitivity to proper marketing execution will change dramatically. Customer behavior is evolving overall, and it is beginning to differ materially according to experience, gender, and demographics. Additionally, people behave differently at work as customers than they do at home as consumers. The picture is further complicated because of consistently inaccurate market research, with customers behaving in a way opposite from what data has been telling us.

Smart marketers are learning from their prior mistakes and experimenting with interactive marketing tools to move past their competition on the learning curve. Creating a clearer (and truer) picture of the online customer means following the lead of experienced marketers who have taken control of access, segmented contacts across multiple addresses, established preferred online tools, and demanded highly relevant messages.

Marketers who cleverly deploy new technologies and understand online customer behavior have the best chance of reinventing their marketing approaches in ways that make a difference. Marketers who learn more about the hows and whys of changing online shopping behavior will realize competitive advantage in the marketplace. Specifically, the best marketers have moved from simplistic assumptions about online customer buying behavior to more sophisticated targeting criteria to direct their online sales and marketing programs.

Online customers do not behave the same way, contrary to popular assumption. Customers have established a “moving bar,” and the art of online marketing has evolved. The novelty of these new media and tools has already worn thin. For example, the assumption that banner ads would continue to outperform magazine ads and direct mail even after the novelty wore off was a bad one. Smart marketers have learned that unless these ads are targeted and connected to other marketing messages, customers won’t bite. Most marketers don’t take that perspective.

Likewise, assuming that email would become a “beacon” into the hearts and minds of customers has fallen short of expectations. In reality, online readers are sick of email marketing. Seventy percent of experienced online readers have at least three addresses screening email. Online customers are becoming increasingly selective about their relationships, the brands they trust, and what they consider relevant. While most marketers are aware of privacy issues and the risks of spam, there is still need for improvement. Email marketing campaign management is still fairly unsophisticated even at the largest of organizations.

So what will be important to understand about online customers? A survey of 400 online customers conducted by IMT Strategies in 2000 and again a year later highlights several aspects of customer behavior that translate directly into marketing results. It shows that customer expectations about privacy policies, frequency, message context, personalization, and ease of response are important to the design and execution of online marketing programs. These “customer design points” must be the framework that influences decisions about management practices and investments today.

Important dimensions to start understanding and managing include the following:

  • Privacy. Adhering to customer privacy standards, trends, and expectations.

  • Permission. Building relationships through permission marketing and practices.
  • Frequency. Managing campaign frequency and customer overload.
  • Context. Making campaigns and offers relevant.
  • Personalization. Optimizing investments in personalization and customization.
  • E-care. Meeting customer expectations for e-care and response management.
  • Responsiveness. Understanding the drivers of purchase and response.

Marketers have to think about the drivers of customer response and purchase. Over time, as more is learned about customer buying behavior, smart marketers will isolate campaign and program characteristics that drive response and action. Isolating the behavior of high-value customers, business customers, or the minority of customers who prefer to buy online will be critical. For example, new online buyers get referrals when shopping online, while experienced frequent buyers prefer search engines.

Campaign integration will be important to getting results. While 39 percent of customers cited either Internet or email as factors that influenced on-the-job purchases, more (45 percent) still relied on offline information when making buying decisions. The ability to distinguish the differences between shoppers and buyers will be increasingly important to proper market segmentation and to the allocation and performance of online marketing dollars. These have to be factored into campaign, list, and database design criteria.

In the final segment of this series, we will discuss each of the dimensions of our customer design points that will form the framework of bringing clarity to the online customer.

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