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Customer Behavior Analysis: Ultimate Guide 2024

PUBLISHED

6 August, 2023

Jonas Kurzweg
Jonas Kurzweg

Growth Lead

Customer behavior analysis

Customer behavior analysis helps product teams to understand their users via quantitative and qualitative data. It refers to your current customer’s in-app interactions throughout their journey, from onboarding to conversions and everything in between. These insights are vital to your app’s longevity since 65% of business comes from existing customers.

UXCam gathers the most accurate behavior analytics with clear and actionable insights. Our tool ensures teams can interpret the data for money-making design decisions. 

Today we’ll discuss customer behavior analysis, examples of it in action, and a high-level guide on how to carry it out.

What is customer behavior analysis?

Customer behavior analysis investigates how customers interact with and feel about your app and business. It uses qualitative and quantitative methods for insight into a customer’s priorities, decision-making techniques, and the variables that drive their behavior throughout their in-app journey. 

Mobile product teams get the most out of customer behavior analysis by grouping their customer personas based on location, for example. Then compare how different groups interact with the app at their respective stage in the customer journey.

Netflix uses customer metrics for predictions and analysis. In addition to an intuitive app and a ginormous selection of high-quality originals, they use behavior analysis to offer personalized recommendations to their customers based on their watchlists. And use data to identify the latest trends to develop more original content and much more.

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Product teams can examine how companies like Netflix use customer data to help inspire their strategies.

For a customer behavior analysis strategy that’s on par with the world’s best apps, consider the leading mobile analytics tool UXCam. We specialize in collecting qualitative and quantitative in-app data to fully understand your users, covering the hows, whats, and why’s. 

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Many prominent mobile app brands trust us for their behavior analytics thanks to our comprehensive feature range and market-leading SDK to provide the most accurate data. 

Interpreting the data is where the real value lies. UXCam helps teams to understand what their data means through customizable dashboards.

Why is customer behavior analysis important?

Personalize the customer’s experience to drive sales

Personalization is the number one benefit of customer behavior analysis and should be a top priority for high-quality mobile app design. According to a study, 71% of consumers expect personalized interactions. 

With a good understanding of your customers—like your least profitable group, you can learn what prevents them from converting. And by removing the hindrances and adding some personalization, like customer recommendations—as Amazon does, you can get them to spend more.

It helps remove customer’s pain points quickly

Construction material supplier company PlaceMakers saw a drop in sales when the pandemic hit and a surge in demand for construction work. They found their app wasn’t updating stock levels, so they implemented a new feature to fix the problem.

PlaceMaker used UXCam’s  Session Replay to test the new feature adoption and initially saw a drop in sales. After watching a few session replays and heatmaps, they pinpointed the flaw, tweaked and tested the design, then enjoyed a 200% sales increase.

Identify patterns for accurate future predictions

Customer behavior analysis highlights in-app user trends, patterns, and habits. You can discover whether there is a particular time of the day, month, or year when conversions increase or slump. You can learn which group and at what stage of the journey they drop off. By connecting the dots, behavior analysis helps product teams predict future behavior based on past behavior.

Acquire and retain customers, and reduce churn

Customer behavior analysis allows you to understand the behavior of different groups, so you have an idea of how your new customers that fall under those groups may interact with your app. 

What’s more, the data plays a huge role in learning what keeps your customers loyal. Customers expect special treatment for their loyalty, and the customer loyalty management industry is big business. It’s worth approximately $5.29 billion as more businesses focus on CX and retention to drive growth. 

As part of your customer loyalty strategy, you can leverage behavioral data to make experiences even more impressive to convince them to continue spending and reduce app churn

Additionally, you can identify the frustrations and circumstances that cause users to churn so you can fix these problems with design.

How to conduct customer behavior analysis

Define business goals and desired outcomes

Define your goals and objectives to shape your customer behavior analysis strategy. Consider the questions you hope your data will answer. What do you want to understand about your customers? 

Then take your goals and set KPIs to measure analysis success. For example, if a goal is to improve your customer’s journey, your KPIs could be:

  • 25% increase in repeat purchases

  • 30% reduction in drop-off rates

  • 20% increased conversion rate

Set and identify your segments

It’s worth reviewing your customer persona for your audiences before starting your analysis. The details should include:

  • Demographics: Gender, location, age, annual income, etc.

  • Background: Interests or hobbies

  • Challenges: Problems to solve

  • Motivations: What motivates them to convert

  • Use of your app: How your app is used in their life

  • Purchase barriers: Factors that may affect their buying choices

This exercise is mainly to be clear on the features of your highest revenue-generating customer in the hopes of finding more. Your customer behavior analysis will highlight your most valuable customer segments and those most likely to increase their spending.

Gather quantitative and qualitative data 

Now, it’s time to start evaluating. Your data will fall into quantitative and qualitative data. Here are the main differences:

Quantitative - metricsQualitative - observational findings
Expressed with numbers and statsExpressed with language and interpretation
MeasurementsFeelings and opinions
AnalyticsThoughts
Answers how many and how muchAnswers the whys

These complementary user research types will be the backbone of your customer behavior analysis to inform design and benchmark ROI calculations. UXCam marketing leading SDK ensures that both types are collected and tracked whenever your user interacts with your app. Your user won’t be disturbed, so you’ll receive the most accurate behavior data.

Apply your findings

Use your findings for app tweaks or new features to address the problems found, for example:

  • If results tell you that people churn during a particular stage of the onboarding process, focus on adding a design tweak to the drop-off point by making the steps more succinct or using animation to demonstrate, if necessary.

  • If you find customers churn more during a particular season leading up to the churn point, you can offer incentives to entice them to stay.

Consider parts of the highly successful design, and use them as inspiration for design changes and new features in other areas of your app.

Automate parts of the process

Much of your qualitative data will come from session recordings, so you’ll need a reliable tool that captures everything. To streamline the process, automate the parts you can, like automatically recording user sessions.

Some analytic tools only capture session samples or begin recording sessions after the user has started interacting—but UXCam’s Autocapture feature automatically records as soon as the user starts using the app. So, nothing is missed!

Analyze, refine, and repeat

Once you’ve analyzed the results of the changes made, for example, tracking key metrics like reduction in drop-off rates and learning how effective your design change is; you’ll learn how effective your customer analysis strategy is and refine where required.

Then it’s time to start over! 

Customer behavior changes swiftly, so continuous analysis and process refinement are necessary for happy customers and a competitive app. 

Use UXCam for Powerful Customer Behavior Analysis

Customer behavior analysis helps teams understand the behavior of existing customers. And should be conducted regularly to keep up to date with your customer’s requirements. The insights are invaluable in creating in-app experiences your customers will happily pay for.

UXCam is a leading mobile behavior analytics tool to support your data-driven design strategies. Our platform is second to one in collecting the most precise behavior data. But don’t take our word for it; start your free trial today and see why leading brands chose us for their customer behavior analysis.

AUTHOR

Jonas Kurzweg
Jonas Kurzweg

Growth Lead

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