With the rapid development of cross-border e-commerce, the competition among cross-border e-commerce enterprises is becoming increasingly fierce. If any enterprise wants to survive and develop in the fierce market competition, it must try to attract consumers and make them its own customers. Everything is customer-centric, and all the activities of the enterprise should be based on satisfying and guiding the needs of customers.
However, enterprises should choose their own customers among many purchasing groups, and should not take serving current customers as their responsibility, and should not regard all buyers as their target customers. Only by giving up something can you gain something. Blindly seeking more and bigger may result in losing all buyers. Therefore, identifying customers will become an important part of customer service strategy.
1. The connotation of identifying customers
Customer identification is to find out who is the potential customer of the enterprise, what are the customer’s needs, which type of customers are the most valuable, etc., based on a series of technical means, according to the characteristics of a large number of customers, purchase records and other available data, and take these customers as the implementation objects of the enterprise’s customer relationship management, so as to provide guarantee for the successful implementation of customer relationship management for the enterprise.
2. The significance of identifying customers
After investigating 200 managers of Fortune magazine’s top 1,000 companies, it was concluded that there is a clear link between corporate growth rate and clear customer identification, as shown in Table 6-1. This table shows that companies with high growth rates understand the importance of customer identification better than companies with low growth rates, and use techniques to strengthen core customers to create more value for the company.
(1) The impact of customer identification on customer retention
The significance of customer identification to the implementation of customer relationship management in enterprises is mainly reflected in the guidance of customer retention and customer acquisition. Customer retention is one of the main goals of enterprises in implementing customer relationship management, and it has an important impact on corporate profits. American marketing scholars Frederick F. Reichheld and Earl W. Sasser’s survey data on nine industries in the United States showed that if the customer retention rate increases by 5%, the average profit of the industry will increase by 25% to 85%. The reason why customer retention has such a great impact on corporate profits is that the cost of retaining existing customers is much lower than that of acquiring new customers, generally saving 4 to 6 times. However, customer retention also requires costs. Not all customers in the existing customer base will establish and develop long-term cooperative relationships with the enterprise. If retention efforts are made for all customers without distinction, it will inevitably lead to a waste of customer retention costs. If customers with a high probability of maintaining a customer relationship with the enterprise are identified in advance through customer identification methods, and customer retention efforts are carried out in a differentiated manner, it will achieve twice the result with half the effort and greatly save the enterprise’s customer retention costs.
(2) The impact of customer identification on new customer acquisition
Although customer relationship management focuses on customer retention, since the development of customer relationships is a dynamic process, enterprises still need to acquire new customers. The cost of acquiring new customers is much higher than the cost of retaining old customers. The main reason is that in the process of developing new customers, the customer feedback rate is too low, resulting in a high average cost of acquiring each customer. If the potential customers who are most likely to become enterprise customers can be effectively identified and targeted efforts are made to acquire new customers, the cost of acquiring new customers can be greatly saved, and the saving rate is even greater than the saving rate when using customer identification in customer retention. This will eliminate unnecessary investment in new customer development and acquire as many customers as possible with as little customer acquisition cost as possible. Customer identification can effectively reduce the implementation cost of enterprise customer relationship management and create a competitive advantage for the enterprise.