Your customers can be grouped according to a variety of different identifiable characteristics that reflect their specific needs and interests. These needs and interests impact their attitudes toward purchasing decisions. Each of these groups is called a target market.
Target marketing is the response to identified market needs. These needs will differ for groups within the total population and they can change over time. Target marketing can turn challenges created by changes in our economic environment into opportunities to better achieve your organizational goals.
While it may seem very limiting to narrow your market, the truth is you cannot be all things to all people. It is difficult and costly to develop effective promotional messages or reach your most likely purchasers if your target is too broad.
There are 3 major components to developing effective target marketing for sales results. First you have to clarify your market segments. Then you have to engage in data mining to verify the market opportunity really exists. Finally, link your target market to your operating, sales and promotional strategies.
1. Clarify Your Market Segments
A solid framework for evaluating your target market incorporates many different variables to develop your customer profile. The key is to begin to identify the distinctive patterns of attitudes, desires, concerns, and decision-making criteria for them. By understanding these elements, you can focus your marketing approaches to more effectively reach your target audience and to influence their purchasing decisions. Customers are more likely to identify with messages specifically tailored to their individual needs.
Target marketing typically incorporates an assessment of the demographics of your customer base. There are many demographic variables that can be easily identified and measured. A few examples for a consumer market include such aspects as age, gender, income, or marital status. Business customers can consider aspects such as employees, revenue, or years in operation. Knowing where your customers live or work is another method for evaluating your target market. Geography is typically combined with demographics to measure market size.
The psychological profile is an exceptionally important variable in target marketing. Understanding your customer’s personality, buying motivations, and interests, provide powerful opportunities to develop communication messages designed to trigger a buying response in your customer.
Other variables may influence your customers’ purchasing decisions. These can include generational differences or customer brand loyalty. They may be highly influenced by other people being involved in their purchasing decisions.
Do you need to position your marketing messages to influence decision influencers too? Clearly assessing these target market segments provides a gateway for creating better marketing messages to ensure your customers and their decision influencers are compatible with your options.
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April 1, 20222. Data Mining
The second critical step to developing your target markets is to quantify your market size. You do this by data mining. Data mining involves analytically reviewing your internal customer and comparing it to external market information. Look for patterns and relationships to help understand your customers’ buying patterns and opportunities to influence them at each stage of their buying decision cycle.
Start by reviewing your Internal Customer Data. Prepare historical summaries reflecting several years of data. Most people only look at one year of data — this is not sufficient to help you determine if your market has achieved its maximum potential or is on a decline.
Look for trends and patterns:
What types of profiles can you create of those who buy from you?
When do they buy?
Who is most profitable to you?
Start evaluating how effectively your marketing approaches reaches them and matches their purchasing decision approach.
Then, conduct a detailed review of the available External Data. Assess how your current customer profile matches up with the real market opportunity. Do the demographics show a potential for long-term growth? Does the data show anything else that might impact your sales success?
3. Tie Your Target Market to Your Promotional Activities
Promotion must be customer oriented and matched to how, why, and when, they buy. Where do they look for information to solve their problem or meet their need? It is not about what you want to sell them. You will need different marketing messages for those who are at the awareness stage gathering information than those who are ready to make a final purchase.
Match each of your promotional efforts to your target market. Clarify in detail how it benefits or provides value to them. What needs of theirs does it meet? How does it meet their needs in ways your competitors cannot?
Make your prospective customers understand how you will help them solve their problems or meet their needs by using your target market insight to customize your promotional messages! Tie your promotions to their decision-making cycle, and move them through their purchasing decision-making stages in a deliberate and effective manner. Heal their pain points!
There are numerous promotional options beyond sales activities that can help you communicate with your target market. These include advertising, public relations, social media, collateral materials, direct mail, email campaigns, website, tours, presentations, networking, participating in community events, open houses, trade fairs, using giveaways, and generating referrals from satisfied customers.
The effectiveness of how you communicate your value to your customers and key referral sources will determine your ultimate sales success. Communicate with them in the ways they expect. Develop a matrix to clearly define each target market you want and need to influence. Then identify how you will use each promotional opportunity to communicate with and influence each market segment.
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Final Thoughts
Using target marketing provides you with a disciplined approach to crafting highly effective marketing messages that have the potential to drastically influence your sales. The process of target marketing is on-going and dynamic. You have to work hard to keep up with your market and discern when it is changing. Changes can be subtle. You will need to adjust your strategies to change with them — or you may have to find new customers to remain a viable business.
About the Author: Jill Johnson is the President and Founder of Johnson Consulting Services, a highly accomplished speaker, an award-winning management consultant, and author of the book Compounding Your Confidence. Jill helps her clients make critical business decisions and develop market-based strategic plans for turnarounds or growth. For more information, please visit www.jcs-usa.com.