Customer Profiling
Customer profiling groups people according to their likely similar behaviours and characteristics, based on a variety of data, with enough detail to build a 'profile'.
Segmentation
'Segmentation is a way of understanding the needs and views of a population in terms of the different communities that make up the population. Segmentation analysis provides the most efficient way to understand the important differences among the various groups of people served by a local authority.' Guide to Segmentation, P.4, www.lga.gov.uk
The most important thing to note here is 'likely' - profiling does not give factual information on real individuals but will give you the propensity or likelihood of a household or postcode to act in a certain way or have a certain lifestyle/trait. Although this is generalising, it takes an important step away from 'one size fits all' and towards being able to tailor services to the needs of segments.
For example, tailoring access channels to customer segments can positively affect customer satisfaction:
Access channel management
(Taken from the CLG Improvement Tools for Local Government - Access Channel Management - Satisfying customers at the first point of contact in their access channel of choice)
When actual data is profiled using Mosaic Public Sector the understanding of who uses what services and what characteristics they share starts to help inform service planning and delivery. For example, by profiling (modelled data) our citizens panel (council service data) and comparing its profile with the overall Calderdale population we were able to see who is and isn't giving us feedback through the panel (for more details see section Case Studies).
Customer profiling is part of a process to develop 'customer insight'.
The IDeA and LGA describe insight as:
- 'the use of data and information about customers to better understand their needs, wants, expectations, behaviours and experiences; and
- the active application of this understanding in the design and delivery of services that better meet customers' needs.' 1
There are many facets to developing customer insight within your organisation, for example surveys, consultation, journey mapping, mystery shopping, and interviews. Customer profiling using modelled data is just one tool. See links to find out more.
1 Insight: understanding your citizens, customers and communities © IDeA and LGA - November 2008
Summary
- 'One size fits all' is no longer an option in local government
- Profiling looks at 'likely' characteristics based on modelled data
- Profiling should be considered as a tool to use alongside other forms of research/intelligence to provide 'customer insight'
- Customer insight is increasingly being discussed within national, regional and local arenas as a way to understand the people we serve