GOOD marketing starts with a clear definition of your target market. In fact, it is crucial to identify it if you want to be successful in business.
You must know who your target is so that you can craft the best marketing message to adequately convey the value you offer to any potential buyer.
Understanding your target market enables you to design the features or services that you will take to market. This could include things like price, packaging, distribution and a range of other issues that impact on market share.
It comes down to three basic facts:
Who wants my product or service?
Where will they find them?
How will I reach these potential buyers with a message compelling enough to make them buy what I have to offer?
Business by referral
This revolves around generating referrals that result in closed sales. In referral marketing, the marketing message is always the same. It all starts with a clearly defined target market.
There are many reasons why a target market is so important. A clearly defined market will enable you to create word-of-mouth marketing within a specific buying group so that business comes to you.
To become known and get people to be referred to you, join a business group, trade association or club and build relationships with people within that target market.
You could write articles for that target market or offer to serve in a leadership capacity within the association or club.
As people in that target market begin to get to know you either personally or by your reputation and they hear good things about the services you provide, they may seek you out and buy from you.
Once you have understood the power of word-of-mouth advertising, you can use that to generate more business.
If you have the luxury of a small target market, you can create a positive referral-based business by doing a great job and relying on the satisfied customers you have to spread the word about you among the rest of that target market.
But businesses don’t always have small and concentrated target markets.
Two very different people attended one of my sessions on referral marketing recently. Both wanted to learn how to get more business by referral.
Both worked in the financial planning industry and understood the importance of doing business by referral.
We’ll call them Planner A and Planner B. We focused on the target market. It was easy to identify which financial planner was going to be more successful.
Planner A said his target market was anyone with money to invest and who wanted a secure financial future.
Planner B had a very different perspective. She wanted to work with young professionals between the ages of 25 and 35 years of age, preferably couples with no children and clear financial goals.
The people whom Planner B wanted to work with people were clear about their future and in the same age bracket as herself, so she understood the issues and challenges they faced.
Not only that, she knew that young professionals often had a habit of spending big and not saving for the future.
This planner had come from a very humble background and wanted to secure a sound financial future for herself. She was also passionate about spreading the word to other young professionals in the same age bracket. She was very clear on her target market.
Both financial planners were competent. However, given Planner B’s passion for her job and a clear target market, it was obvious that she was destined for success.
I predicted that she would have to work with only a few young professional couples and the word would spread fast among the target market, bringing more and more referrals and, of course, closed business.
Planner A would have to pitch his services to clients everywhere, hoping to find someone who would work with him.
He would not have the ability to get referrals from a clearly refined target market like Planner B. Other than being competent, he would have little extra to offer to potential clients.
The message for business owners and sales professionals is clear: if you don’t have a clearly defined target market, you must spend time defining one.
With a clearly defined target market, you will create a steady stream of referral business.