Where Do Your Sales Come From?


Do you know where your sales come from?

Companies with physical storefronts do. They know how much product they sell at each of their locations. And they can judge the relative success of each location by comparing it to past performance and to all other locations.

For example, Starbucks knows that the storefront at 29th and Park Avenue in Manhattan serves 75,000 customers per day at an average order value of $4.50 per order, for a total daily haul of $337,500.

But what about companies that sell by phone? Or online?

One might think that it doesn’t matter as much for these companies with a more global strategy and reach. Unlike local stores, online stores don’t have to rely on physical locations to drive sales. And so where people are coming from matters less.

Here’s why that’s wrong:

Being able to determine where your sales are coming from is critical for a number of reasons.

First and foremost, it is critical for marketing purposes. Even in a digital-first world, location matters in marketing. Companies can spend their entire advertising budget in one state, or one city, if they want to. Location is a targeting feature in almost any kind of online advertising one can imagine.

When we know where our customers are coming from, we can better determine the return on our advertising campaigns in progress. We can also optimize our marketing budgets so that we can capitalize on those regions we’re most likely to succeed.

Second, it matters for logistical purposes. Let’s say you manage an online storefront that ships physical goods. In order to optimize your shipping processes, you need to know where most of your customers are located. Back when Netflix was selling DVDs by mail, the number one reason for their success was how well they were able to predict and model their logistical operations, placing fulfillment centers right where they were most needed.

And lastly, where your customers are located can affect how you communicate with them. If your customers are mostly on the west coast, would it make sense to keep call center hours in the early morning in the east? If your customers are big city dwellers, does it make sense to include imagery of wide open spaces on your product pages and promotional materials?

The more you know about your customers, the better off you’ll be. And that includes where they live.

What Do You Know About Your Customers

Here is the simple truth – the more you know about your customers, the more successful you will be as a marketer or small business owner.

  • Knowing your existing customers will help you find more people like them
  • Knowing your existing customers will help you create products they want
  • Knowing your existing customers will help you provide better service

What should you know about your customers? In short, as much as you can.

You should know the things that relate to your business – how they found out about you, why they chose you over your competitors, how they use your product or service and whether it solves their problems, how they purchased, when and how much.

You should also know things that don’t relate directly to their interaction with your business. You should know things like where they live, how old are they, what do they do for a living, what are their hobbies and interests, where do they get their news, where do they shop, what else do they spend money on.

The world of big data, machine learning, and artificial intelligence will allow companies of all sizes to take advantage of information to improve their business. Marketers will have new ways of reaching out to potential customers with proven ROI. And with more data, those efforts will be more fruitful.

If you don’t know enough about your customers now, today is a great time to start learning. Collect data through user behavior tracking, focus groups and studies, surveys and questionnaires, interviews and direct customer outreach. Marketing departments should put someone in charge of customer knowledge and data analysis.

You may be surprised by how much information you already have on your customers. Start asking questions internally, streamline and protect that information for later use, find the holes and begin to fill them.