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Tracking consumer purchase behavior with third-party data

For new customers, is there any legitimate way to track their past consumer behavior, to get an idea of their growth potential?

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This depends on the business you're in, but in some businesses simply asking the consumer might help you uncover their past behavior. When asking the consumer is not appropriate, or when the answer would be impractical to convey (as, for instance, grocery shopping behavior), it's possible to compare a consumer's profile with other, similar consumers using third-party data.

There's a saying in market research, that "birds of a feather flock together," which means that people who live in the same neighborhood, drive the same kinds of cars and have the same kinds of family types are similar enough to each other that you can project the purchase patterns of one onto the other. There are large syndicated research services based on surveys done of tens of thousands of customers annually that can be of great use here. Keep in mind that the data is not perfect, because the particular customer you are looking for is not on the research panel himself, but there are other customers who seem to be a lot like him who are.

Hear more in Creating Customer Value, a SearchCRM.com monthly podcast series with Peppers and Rogers.

This was first published in April 2008

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