Understand “Customer Tempo” to Improve Marketing Results

Factoring customer behavior and buying patterns into marketing strategies helps you gain a competitive edge. For the past decade, traditional direct-marketing methods have had deteriorating response rates across the broad market. Keeping pace with changes in consumer behavior and demographics allows marketers to redirect the emphasis within a campaign to target faster-growing groups and address specific event-driven behavior.

You’re looking at a photograph. You can make certain inferences about the subject in the picture, based on her gender, her facial expression, the background of the photo and the clothes she’s wearing. Compare that snapshot to a full-length movie in which the woman is the main character. In the movie, you learn that she is 26 years old, about to graduate from business school. She accepted a job on Wall Street and is moving to New York City after having spent her entire life in Jacksonville, Florida. Without the character dimensions revealed through the sequences in the movie, you could not have known that her life is changing dramatically and quickly—and that her purchasing behavior is shifting just as rapidly.

Knowing a customer’s needs, what she values and her spending habits, is critical to successful marketing for every business. Imagine how much more effective your marketing could be if you understood your customers according to an evolving timeline based upon actual purchasing behavior—the “customer tempo”—rather than through limited data captured at a single point in time. Targeting specific customer groups would become easier and the results would be more valuable.

This paper introduces the concept of customer tempo analytics as a way to achieve better customer insight and to improve marketing campaigns. We’ll discuss consumer behavior as it unfolds, using consumer spending data to create campaigns that deliver results.

Companies marketing to consumers are constantly challenged with sustaining revenue growth in existing products. For the past decade, traditional direct marketing methods have had deteriorating response rates, making them less economical than in the past. Across all channels, the disintegration of the mass market into increasingly fragmented audiences requires marketers to address specific target groups with their own messages while keeping a cohesive brand presence. Keeping pace with changes in consumer spending behavior and demographics allows marketers to redirect the emphasis within a campaign to target faster-growing groups and address specific event-driven behavior. While traditional segmentation analysis or predictive modeling produces a snapshot using minimal data input, customer tempo analysis creates a movie. If you pay attention as the characters develop, you discover information that influences and perhaps even significantly changes your marketing strategies.

Customer tempo is a concept that applies to both individual consumers and market segments, measuring the flow of customer activity as it relates to the purchase of products or services. This methodology harnesses insights from transaction data over time to illuminate the dynamics of individual consumer behavior and specific market segments. Adding this dimension to current demographics, purchase value data and channel characteristics gives marketers better information to generate superior campaign results.

Customer tempo measurements provide clear advantages to companies using them. This type of analysis is useful to:

  • Identify promising areas of growth
  • Enhance direct-marketing response rates
  • Improve retention of existing customers

How is the magic of customer tempo analytics accomplished? Let’s take a closer look.