2019-05

Overcoming the marketing resource crunch by focusing on customer behaviour

by Karen Lewis
 | 
11 June 2019
Overcoming the marketing resource crunch by focusing on customer behaviour
Marketing - like many other important activities - often doesn’t get the attention it deserves at many small and medium businesses (SMBs). This is because marketing resources are generally scarce - they are unlikely to have a dedicated person looking after marketing, and budgets are tight. For this reason, it is impossible to cover off all bases, so SMBs need to focus on initiatives that will deliver the biggest marketing impact.

According to the 2019 Salmat Marketing Report, the two biggest marketing challenges facing Australian SMBs are reaching new customers (45%) and creating customer loyalty (40%). To overcome these challenges, it is important to first understand consumer purchase behaviour. To reach them, you must understand the channels they use when making purchase decisions. To create loyalty, you must understand what makes a customer loyal to a brand.

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Here are three key insights into consumer behaviour that will help you focus your marketing resources to deliver impact.

1. Consumers value Search above all else

Our research found that search engine results are the top channel used by consumers to make purchase decisions, with half (49%) of consumers using it. Surprisingly, Search is now more influential than recommendations from friends/family at 46%. This is a dramatic shift from last year, where friends and family topped the list with 72% of consumers saying they consult friends and family when making a purchase decision. This swing shows a striking shift in consumer behaviour, and highlights the importance of understanding these changes over time, so that you can align marketing activities accordingly.

However, while Search is the number one channel for consumers, only one quarter (25%) of SMBs invest in Search Engine Optimisation (SEO) and even less (20%) invest in Search Engine Marketing (SEM).

On the other hand, most SMBs (44%) are investing in social media. However, this isn’t an influential channel for consumers, with just one in four consumers (25%) saying they use social media as an information source for making purchase decisions.

Therefore, SMBs can see more bang for their marketing buck if they follow consumer behaviour and shift some of their investment from social media to SEO and SEM. In particular, SMBs should invest in local SEO. More and more consumers are turning to search engines to find local services and businesses. In fact, more than 50% of online searches now specify a location – it’s called ‘local intent’. This means consumers are specifically including the name of a city, town or postcode in their search request. What’s more, people are increasingly turning to their mobile devices to search for services at the precise time and location they need them. By investing in local SEO, you can ensure your brand is being prominently shown to these highly relevant customers at a crucial point in their decision making.

2. Discounts work, but demonstrating value for money is more sustainable 

When we asked consumers why they continue to buy a specific brand, the majority of consumers (67%) said it was because they trust the brand. However, building trust with consumers takes time, and there is no silver bullet that will earn their trust. Instead, it’s about meeting - and hopefully exceeding - your customers’ expectations time and time again.

However, the second reason consumers gave for brand loyalty was special offers/promotions/sales (49%). SMBs are already aware of this, with one third (32%) of SMBs discounting their products monthly, and one quarter (24%) doing so weekly. 

Whilst discounting can be an effective tactic for getting your customers to return, it isn’t sustainable to do it frequently, and isn’t a good way to differentiate yourself from the competition. Instead of discounting heavily or focusing on undercutting the competition on price, SMBs should instead demonstrate why they deliver the best value for money. If your marketing messages communicate this effectively, you will have more customers that are willing to pay full price and you won’t have to discount as often. 

3. Aussies love loyalty programs

The third driver of customer loyalty for consumers are loyalty program points/rewards (36%). In fact, consumers are more likely to buy a specific brand because of loyalty points rather than for a brand’s ethics or CSR initiatives.

Australian consumers are conditioned to expect something back when shopping with a brand. That is why nine out of ten Australians have a loyalty card in their wallet. According to Mastercard, the average Australian belongs to 6.1 loyalty programs. 

Customer loyalty programs are relatively easy and cheap to set up, but for some reason, this tactic only ranks seventh for SMBs. In fact, more SMBs are choosing to invest in sponsorships and special brand experiences than loyalty programs. 

By creating a loyalty program, you can ensure you have more meaningful engagements with your most important customers. As these customers come back to your website, or interact with your marketing emails, you’ll collect more data to build a rich profile on them. This in turn will allow you to create a more personalised approach to ensure more success in converting a sale.

Being wise about your use of resources is key to a successful SMB, and this approach shouldn’t change when it comes to marketing. Follow your customer data and you will find success. Invest in Search to reach more customers. Be smart about discounting and demonstrate value for money. And create a loyalty program to get closer to your most important customers and encourage repeat purchases. By following the behaviour of your customers and focusing efforts at crucial points in their purchase journey, SMBs can overcome their biggest marketing challenges and pave a way for short and long-term gains.

About the author
Karen Lewis

Karen has over 16 years Digital experience with a background initially in Web Development and SEO. She is passionate about ensuring that Digital enables positive customer experiences and to provide frictionless, immersive interactions moving clients closer to omnichannel. Karen currently heads up the Digital and Performance Marketing team at Salmat who focus on achieving great return on investment results for clients through digital channels such as Email, SEO, SEM and Data and Insights. Karen also heads up the team who manage Lasoo which is a deal and discount aggregation website and app that helps consumers find the best bargain across multiple retailers.

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