Platt Perspective on Business and Technology

Connecting into the crowd as a source of insight and market advantage – 12: reconsidering the target market

Posted in macroeconomics, strategy and planning by Timothy Platt on August 15, 2012

This is my twelfth installment in a series on connecting into the crowd as a source of insight and market advantage, but with an important difference – doing this in ways that explicitly allow and support measurement of costs and of value returned in the interactive online context (see Macroeconomics and Business, postings 77 and loosely scattered following for Parts 1-11.)

Up to now I have been making a basic and even fundamental assumption that I will be questioning here for its accurate reliability. That assumption is that the demographics that you would market to are fully enough knowable and fully enough subject to precise mathematical modeling so that you can analyze your marketing data to match to a precise fixed target. It can reasonably be argued that this is never completely true and even when marketing to a localized fixed community in which you know all participants and on an individual basis – think in terms of a local marketplace oriented small town store as a working example there, where the clerks and owner know everyone in their community. People still make unexpected and out of pattern purchases and purchasing decisions. But as you move your business to the less defined and less unequivocally definable online and even global online community with all of its diversity, this assumption can become less reliable.

• My goal in this posting is to discuss this uncertainty and ways to bring it under control, so that you can more effectively identify and target more precise market demographics that would most likely purchase from you, and so you can connect with them with a more effective message to help bring them to do so.

I would start this by raising and addressing a potential objection, and with a simple question. When you are marketing and selling online you are potentially reaching out to the entire world, and to any and every possible demographic profile. So why bother to make the special effort to find specific individuals and the groups they belong to, when they are looking for you? My answer to that is simple. If you in effect sit back and wait for people to find you, and with a reliance on unfocused, or at least less focused marketing you become entirely reactive to the marketplace. And your sales and business effectiveness are that much more likely to end up on the low-performing, wrong end of the Pareto distribution and loosing competitively to your more proactive competition.

• Start out with your best understanding as to who, by demographic type, would be most expected to want what you offer and at the price point you can offer it at.
• The more novel and disruptively so, your marketplace offering, the less track record for past and current comparable purchasing you can turn to in building this understanding, and the less certain you will correspondingly be in who to market to.
• Offer and market to your first iteration target market, and with a mix of less focused, more generic marketing added in and gather feedback from each marketing channel and campaign you pursue. Sales numbers and data as to who buys, who looks but clicks away (where possible, and at least by numbers), and related feedback enters in here. But that should only be part of your feedback gathering campaign.
• Tap into and use social media and crowd sourced reviews and other forms of shared feedback, and both to find out how your offering is being received and to help identify patterns and trends in what could be seen as related purchasing. Actively participate in those online conversations as a business. Third party marketing data can help there too and even with its inherent limitations (see Part 11: reconsidering market demographics.) And that can definitely include data from specialist third party providers that study and map out the online conversation, and that know better and more cost-effectively where to look in the interactive online for what – and that have accumulated big data from there to prove it.
• But whatever data sources you tap into look for strategically meaningful feedback that you can use to refine or even redirect your market reach. And be aware that this can mean redirecting your marketing and sales focus in new and initially unexpected directions.
• This can be because you offer something fundamentally new. But this can also become necessary when the marketplace changes and even established products can become repurposed in the consumer’s eye and usage. As a working example, you may be offering a new variation of bib overalls, and your initial-iteration marketing would be to farmers and farm workers, and to other but parallel manual labor market demographics. Now a teen idol goes on tour with their band wearing overalls and suddenly they are at least a brief fashion statement and fad. How long would it take you to recognize this and to re-gear to this market with the production, distribution and sales of the sizes and colors now in demand? How would you market to this emerging trend to strengthen the demand by widening perceived value for the customer, so this does not simply fizzle out and as quickly as it arose? Feedback and iterative marketing and sales campaigns are key to making marketing and sales work in a rapidly changing, complex marketplace.

Think of this as being proactively reactive – as being more proactive than your competition and even as you positively reach out from the feedback-based positions of understanding that you develop and achieve from your marketing analysis.

And build an awareness of marketplace change into the basic dynamics of your marketing and of how you gather and use marketing data. Operationally plan around and for marketing demographics uncertainty and with an understanding that the business that reaches the closest approximation to a best possible marketing analysis fit first, and most often will win the greatest market share and yes, brand loyalty too.

And that last point brings me to the basic topic of my next series installment: brands and brand loyalty in an online context. Meanwhile, you can find this and related postings at Business Strategy and Operations – 2 (and also see Business Strategy and Operations.) You can also find this at Macroeconomics and Business.

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