In recent years
social media marketing has been gradually gaining acceptance as a legitimate
and when properly utilised, powerful tool in the marketer’s arsenal.
And with this rise in popularity and use, has also come a call from various
business writers for marketers to forget about segmentation in the traditional
sense and instead, adopt the approach of marketing their product to segments of
one.
This
approach is predicated on the belief
that social media allows marketers greater insight into customer’s needs
based on their new found ability to engage the prospect with a true dialog, unavailable before the rise of the current day
social media networking platforms.
This
potential is well established and where the customer is willing to engage
online with the business, a better understanding of the unmet need can be
obtained and act as a basis for tailoring solutions that exactly meet that
individuals needs.
The rate limiting factor with this approach is
that not everyone will be willing to engage with you and in the absence of a proactive
and strategic approach to targeting, the result is likely to be an
uncoordinated and ultimately unsuccessful effort.
The need for
segmentation and intelligent target marketing has not been replaced by
LinkedIn, Twitter or Facebook. These
platforms provide added insight but do not replace these key pillars that are
so crucial to the overall marketing planning process.
With this
said the conversation should then turn to what are the key criteria to think
about when targeting for your business.
There are 3
that should be focused on. Namely: customer attractiveness, customer growth
potential and customer usage.
By customer
attractiveness we are referring to how closely does a particular client or
prospect match up with your stated target audience and brand positioning.
For this you
need to have a clearly thought out and concise description about who your ideal
customer is and by extension who your target audience is. This should always be
formally written down and contain the following key elements.
Specifically the statement:
n Should
describe a distinct place that the brand occupies with the target market.
n Should
differentiate the brand in a meaningful way from rival brands.
n Should
include a core benefit that will assist the user.
For example some years back as a product manager for a
leading pharmaceutical firm I wrote a positioning statement for one of the
cardiovascular products as follows:
Brand X is the blood
pressure medicine of choice for mature hypertensives, which have declining
kidney function, because it offers superior tolerability due to its dual pathways
of drug elimination.
This statement includes: the target audience you
seek to attract (i.e. mature hypertensives), the brand name (Brand X), the
product category (blood pressure medication), the core benefit (better
tolerated) and importantly the reason to believe in that benefit (dual pathways
of drug elimination).
The closer an individual fits this target group the
more attractive they are for our brand.
The second criterion is customer potential. Here you
are looking at how much of your brand a customer is likely to need to have
their needs met. Let’s look at the example of two separate businesses that
could buy your product. For example a restaurateur about to open a restaurant
could buy a hundred chairs for his venue and therefore have a have a much
larger need for chairs than a local convenience store owner about to open that
business that will require only a hand full of chairs. Again as with the first
criterion of customer attractiveness, the range will be from low to high.
The third criterion is current usage. Does the
prospect or customer use the product already and if so how much.When you combine these 3 criteria you get a simple
model as demonstrated below.
Figure
1. The Target Market Analysis Model*
You can
imagine a numerical scale of 1 to 10 along each of the three axes, and
altogether forming 8 possible quadrants. So which of these quadrants represent
the optimal focal points for maximum impact?
A strong
case can be made for two in particular.
The first of
these is the group that concurrently has high potential, high attractiveness
and high usage.
In other words the customer or prospect being targeted has high attractiveness
because they fall squarely into the overtly stated target market definition
contained within the brands positioning statement.
Fig 2.Typical
Long Term Customer Profile with High Potential, High Attractiveness and High
Usage Quadrant.
Secondly
they also have high potential because they still require more of the product to
have their existing customer needs satisfactorily met. Finally they use an
existing high current level of your brand, which will usually have been built
up as the relationship, experience and overall outcomes with the brand have
proven beneficial over time.
Clearly this quadrant describes the dynamic of an established client with a
high level of customer satisfaction, which would imply a higher level of
loyalty to the brand and a greater long term probability of ongoing, repeat
business. In any situation this is a critical group that needs to be analysed,
identified and rewarded for their patronage.
The second attractive
quadrant that should always be actively targeted is that of the high potential,
high attractiveness but low (or no) current usage prospect. In this instance we
see the potential or former customer, who still has a high degree of
attractiveness to the business as they align perfectly to the specified target
market, which also have high potential because they still use large amounts of
this type of product to meet their needs.
Unlike the first group however who are avid users and already consume high
levels of the brand, this group currently has a low level of current use and
will require tactical effort by the business to convince them of why this
product should be preferentially preferred over other rival brands.
Fig 3. Typical
High Potential Prospect Profile with High Potential, High Attractiveness and Low
Usage Quadrant.
Although you
can make a strong case that this is the more difficult group of the two to sell
to because it still needs convincing, it remains the group with the greatest
dollar potential for growth because the amount that can potentially be bought
in the future is much larger than the earlier group.
Summary
Where ever
possible a business should attempt to actively define and target the two
influential groups outlined in this article, through its marketing and
commercial efforts.
Although these
targets are distinct groups requiring strategically different approaches to maximise
the potential of each, they stand out individually and collectively as the groups
with the greatest potential for dollar growth.
So until next time, good luck and good marketing.
Regards,
Daniele.
