Home Topics Entrepreneurship Analyze data and consumer behavior to inform your business development

Analyze data and consumer behavior to inform your business development

by Samir Daoud, Franchise Director, Gold Star Chili and Tom & Chee

There’s no question that we live in a data-driven world, and it’s easier than ever to have a wealth of information at your fingertips. Knowing that data is important and what data is important are two very different things. Many people interested in starting their own business (or considering starting their own) quickly become aware of the data available through consumer platforms like Facebook, Google, and LinkedIn.

However, the use of the data results from these platforms alone is no longer sufficient today or must at least be used against other informative data.

Geographic behavior.

Whether you’re building a physical location for your business or just looking at niche targeting techniques, leveraging all of the geographic data surrounding your target audience is a must. In the restaurant industry, new location opportunities are assessed using a variety of metrics: number of households, number of businesses, traffic patterns and numbers, and income levels, to name a few. For non-storefront businesses, the same metrics are critical to locating and understanding the behavior of your target audience.

The US Census Bureau analyzes locations based on population size, age, gender, income, transportation preferences, and other factors, all of which can be searched by zip code, and is a great place to do your own consumer research in your area for your product or service. The Environmental Systems Research Institute (ESRI) combines the lifestyle of the community and demographic information in an interactive dashboard for even more targeted information on the consumer market.

The key to doing this is: Understanding your consumer behavior is critical to engagement and product offering.

It’s in our psychology.

Like it or not, consumer trends are often driven by our common group characteristics: work, household income, and family values. Entrepreneurs can gain tremendous insight by examining these human patterns and their application to a particular industry.

Take the time to get as much insight into your customers as possible – what are their hobbies? Age, marital status, average income, etc.? By generating a target audience based on your current customer profile, you can consistently target a well-engaged group of potential consumers. From proximity advertising to geosocial media, the opportunities to gather information about your market and get your message across to your customers are growing day by day. This data is critical to any successful aspiring entrepreneur that needs to be leveraged.

Learn from results.

Data is a good guide for any business owner or potential startup, and platforms just keep getting better at collecting and viewing people’s data. But just having a pretty display of your data isn’t the same as understanding it.

The best way to understand your data is to answer it with a very specific question that you want an answer to: For example, “What is the average age of my user?” If you’ve tracked your data correctly (or are using platforms that we all use, like Google or Facebook, which automatically collect this information for you), the information should be available immediately. Now start applying it to create a larger profile. What geographic areas does this age populate? How do they behave there? What are their interests at this age and what are they looking for? And most importantly, how does your product fit what this customer may be looking for.

Don’t forget to meet people.

Cutting edge technology and software are fantastic when you have access to them. However, some of the most insightful and vital information you can find can be gathered through interactions with members of your community.

Join your local Chamber of Commerce. Attend city council meetings and national conferences / congresses, where available. Talk to real estate agents who can provide you with location and location analysis reports. Talk to other business owners in your area about their good and bad experiences. Your local fire and law enforcement agencies may have access to more detailed and up-to-date information on traffic patterns and urban developments than even the most sophisticated AI programs.

Whether you are new to the business world, as a franchisee, or as an independent owner, the success of any business depends to a large extent on your ability to collect and analyze data at all levels. There is a wealth of knowledge that you can accumulate without ever spending a dime. A willingness to invest time in learning puts you right out of the gate on the right path.

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