Know Thy Customer

Focus by Jared Cherup

I’ve been a big fan of Customer Centricity, a book written by Wharton’s Peter Fader for quite some time. Fader advocates that “in the world of customer centricity, there are good customers … and then there is pretty much everybody else.” He recommends focusing and investing in retaining the former, while not ignoring the latter.

To apply the concepts of customer centricity to Annual Conferences, identify the attributes of your most frequent full conference paying attendees (top 5 or 10%) over the past five years or so. Attributes may include firmographics like industry and # of employees and demographics like title, job function and years in the profession. Design the education and networking experience to primarily meet the needs of this select audience. When you get this right, you will also serve and attract many other follow attendee segments.

Revenue by Cohort

Last year, Fader and his co-authors released a new book, The Customer-Base Audit: The First Step on the Journey to Customer Centricity. This book provides more of a how-to for getting a deeper understanding of your customers’ past buying behavior to help predict the future.

One of the five lenses detailed in the book is to analyze your customers by cohort. A cohort is defined as grouping customers that were acquired in a given period of time. To utilize this lens track the year the customer first did business with you. This will enable you to analyze and predict future revenue contribution for each cohort. For B2B events, you want to understand how much of your revenue is coming from existing vs. new customers.

The chart below provides a visual of how registration revenue is trending by cohort for the past four years.

Attendance vs. Membership Cohorts

A similar analysis we use is to compare membership and attendee registration cohorts. This can be very insightful for identifying and making plans to strengthen the linkage between membership and premium conference participation, For this analysis, you’ll need a member since date from your Association Management System or CRM. Here’s a few how to steps:

1. Create four ranges for member duration. We like 0 to 2 years, 3 to 6 years, 7 – 9 years and 10+ years.
2. Determine what percentage of your membership is in each of these ranges.
3. Perform the same analysis using your attendee registration data. Usually this data will not include the “member since” date. To add the member since date to the attendee registration file, use the member ID field to do a VLOOKUP in Excel.
4. Compare the two. What we often find is that members who have been customers the longest, tend to also be the ones that attend your premium conferences at the highest rate. Conversely, new members invest in the most premium products at a much lower rate.

Target Audience

One of the other principles of customer centricity is to identify the vital few vs. the useful many customers. To apply this to an annual conference product, consider these four lenses:

1. Who has the professional development budget to attend every year?
2. Who are the economic buyers our top sponsors and exhibitors value most?
3. What audience segments are tackling the biggest challenges or driving change?
4. Which audience segments have the highest influence for referrals?

Do you currently target a specific cohort or customer group? If so, what criteria have you used to help identify those individuals?

Adapted from Dave’s Forward Thinking column in PCMA’s Convene. Reprinted with permission of Convene, the magazine of the Professional Convention Management Association. ©2023.