In this article, we would be discussing on how AI-powered customer profiling can boost your in-store sales. We all know that businesses are constantly looking for ways to improve the efficiency of their brand positioning and marketing strategies.
In today’s digital world, consumers have become much more demanding in their expectations. Brands can no longer get away with blanket messaging that caters to the masses. They are expected to roll out personalized communication that speaks to each customer personally.
A few decades ago, companies would consider this level of personalization to be an impossible feat. However, the advent of artificial intelligence has eliminated the need for guesswork by providing in-depth data that can be used to create unique customer profiles. Through this article, you will be able to understand a few core concepts that surround customer profiling and how they can help you boost revenue generation and enhance customer experience. Some of the key topics that will be discussed are:
A customer profile is a model or outline of a group of customers who share common traits. These profiles can contain extensive information about your customers including their demographics, preferences, expectations, behaviour, etc. Using customer profiles, brands can easily identify, segment and define their target audience. It is essentially a marketing tool that businesses use to understand their customers and helps to make informed business decisions. The insights that you gain from customer profiling can help you choose the right channels and messaging approach in your marketing strategies. The first step in creating a consumer profile involves gathering relevant information about your consumer. This can include demographics information, psychographic information, online and offline behavioral information, social media interactions etc.
Through online media, you can get customers to provide feedback and fill out online surveys to get additional information about their preferences. There are a variety of social media listening tools and e-mail monitoring tools that can help you analyze consumer behavior as well.
In an offline setting, many businesses use AI-powered real-time video analytics solutions that can automatically provide real time insights on customer demographics, emotions and preferences. Using the information acquired through online and offline channels, you can create an in-depth persona that demonstrates the type of customers you need to target.
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By developing a customer profile, businesses can analyze transactional data and detect patterns and correlations in the customer behaviour according to the segment they belong to. The key benefits of customer profiling are,
Customer profiles not only contain information on the demographics of your consumers, but also information about their spending habits and behaviour. This provides a very accurate picture of your most profitable customers. Using this, you can develop the right marketing strategy, allocate resources more effectively and optimize your marketing budget for better return of investment.
For example, a retail store can collect information about the demographics of their consumers and their preferences through video analytics. Additionally, they can use loyalty cards, phone numbers and receipt scans to get further information about how they spend their money and what products they buy the most. Data from both these channels can be merged into a single customer profile that can provide valuable insights to marketers.
Without customer profiles, it would be extremely difficult for companies to execute any kind of personalized marketing campaign. A research from Accenture reveals 75% of consumers are more likely to buy from a business that recognizes them by name, recommends options based on past purchases, or knows their purchase history. For example, if you have ever bought any products from Amazon, you would have noticed that the website displays product recommendations that are in line with your interests and your past purchase history. The platform also offers suggestions for products that are similar to the one that you are looking for. This content will be unique to each user, and goes a long way in increasing the sales of similar products through personalized recommendations.
AI-powered customer profiling can help businesses to automate the customer profiling process. Manually analyzing and consolidating the data can be extremely time consuming and inefficient. AI powered solutions now make it easy for businesses to perform automated customer profiling in online as well as offline channels.
In online channels, it is easier to collect the data of the user via form submissions, browser signatures, cookies, behavior in websites etc. All this data can be consolidated into a single pool of data, which can be used to train machine learning algorithms to identify customer profiles. But when it comes to offline channels, businesses are not sure how to collect these data from a customer without bothering them.
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To perform customer profiling for in-store customers, businesses need to collect a lot of data from the walk-in customers. The data that need to be collected includes demographics, travel patterns inside the store, affinity shown by customers towards different sections, aisles, drop off rate and sections that cause the most drop offs etc. Manually collecting this data is a near impossible task, unless the business owner can afford to deploy a large number of employees just to observe the walk-in customers. So what’s the solution? How can AI help?
Today, almost all stores have CCTV infrastructure installed in its premises. Right now, the only responsibility of these cameras is to record what’s happening inside the store. But, what the business owners are missing out is, they can use the same CCTV infrastructure to automate the customer profiling.
AI-powered real-time video analytics solutions such as Emotyx can enable CCTV cameras to observe the walk-in customers to collect a load of data from them. Gender, ethnicity, age, dressing style, travel patterns, affinity towards different products, purchase pattern, etc can be tracked using CCTV cameras. Emotyx can even detect emotions of customers and create in-depth customer profiles, generate heat maps to identify popular sections of the store and much more. By using such solutions, businesses can access in-depth insights into customer demographics and behaviour in real time. AI algorithms use several of data points to systematically develop customer personas. Some of these data points include:
Using these data points, AI solutions can-
One of our (Accubits’) customers is a leading supermarket chain in Australia, which has 20+ supermarkets located in different cities across the country. Supermarkets and Grocery Stores is one of the most competitive industries in Australia. Our client wanted to leverage cutting edge technology to enhance their digital capabilities to differentiate their brand from the competitors. We built a computer vision-based in-store heatmap analytics solution for our client. The solution collects in-store customers’ traffic data from CCTV cameras installed in the store and analyzes it to create a visualization of the “hot” and “cold” areas of the store. The hot zones represent the areas that are more visited by customers and cold zones represent less-visited or ignored areas. Based on the data generated from the solution, multiple AB testing is done on the product placements and noticed an increase in overall sales by 18% in 3 months. If interested, you can read the detailed case study here: AI-powered video analytics solution
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Using artificial intelligence solutions to create customer profiles is much superior to traditional manual segmentation for the following reasons:
AI solutions can go a long way in helping businesses improve their customer segmentation techniques. They allow for the creation of highly accurate customer profiles that can be used in personalized marketing campaigns. This allows brands to display the right messages to the right customers at the right time.