Classifying Customers and Identify Profit Centers for your
Business
By grouping and mapping out the relationships you have with your
customers, you can do more to finding profit centers in your
business than anything else. This exercise will go a long way to
demonstrate to you that not all customers are created equally;
in fact, some are much more profitable than others are. We will
touch on reasons why you should classify customers, how to
describe your supply chain, ways to define customers, and
finally how to map your distribution channels.
Classifying customers is very important to identifying profit
centers in your business because classifications help target
prospects for sales, determines how different customers respond
to your marketing, and helps you anticipate their future needs.
Through better targeting, you extend your reach, increase your
closing ratios, and help target buying customers with your sales
efforts. Customers do not all respond the same to marketing, but
knowing the appropriate triggers and channels of distribution
will help you customize your marketing for maximum results. As
you group your customers, notice places where your product wears
out or needs to be replaced, these areas reveal possible service
options and influencers of new purchases.
In describing your supply chain, outline who is involved in
supporting the customer, whether it is a
distributor-reseller-customer relationship or a hybrid system,
and ask several critical questions that will produce clarity in
this process. Using simple diagrams outline each of the
individual organizations involved in providing services to your
customers, will highlight opportunities for teamwork and
improved communications. You may find a traditional supply chain
supports your product, look at ways to grow or improve the
demand of your product through others. Create ideas from
whatever type of supply chain you have by asking some critical
questions; Who supports the customer? What do they do? Why does
the customer go to them?
The information gathered to this point contributes to defining
your customers, including where they are located on the supply
chain, what are their reasons for purchase/expectations, and
where can you reduce your costs. Think about the different types
of customers, how you reach them, and to whom they interact with
in your supply chain. Additional sales opportunities arise when
you look at the usage of your product and the importance of it
to your customer; these areas further refine your
classifications. Finally, look at ways you can reduce costs by
making it easier to acquire your product, increase your value or
your support abilities.
Bring all this information together by mapping your distribution
channels; start by outlining the relationships between partners
and customers, then define how your customer get your products,
and lastly any customer interaction points inside this system.
Using a simple workflow diagram bring together your supply chain
and customer category information to produce a single simple
drawing. This drawing describes how the customer gets your
products including key players, delivery methods, and each
categories preferred method of acquisition. Another useful tool
will be to clarify customer interaction points, which are, any
communications between your customer and your organization