The Tough Economy: Part II: Who is Your "Perfect Fit" Customer?

First, thank you to everyone who viewed my first article, <a href="http://biznik.com/articles/the-tough-economy-bad-news-all-around-us-how-to-keep-your-business-strong" title="Read The Tough Economy: Bad News All Around Us &amp; How to Keep Your Business Strong">The Tough Economy: Bad News All Around Us & How to Keep Your Business Strong</a>, posted on Biznik three weeks ago. I appreciate your feedback and support.  I really want to be able to help this community & its members learn more about marketing in general.  Also, I hope to provide some useful strategies & tactical ideas for members to use to make their business stronger in these tough economic times. This second article is about developing or refining your marketing plan.  There are three main components to a successful marketing plan and it can be applied equally to both your current customer base efforts & new customer acquisition: <ul> <li>Market:  Defining your target market as in as much detail & as specifically as you can;  </li> <li>Package: Determining what marketing strategies & tactics can reach this specific market in the most cost effective manner and; </li> <li>Offer:  Presenting your message to this target market in a way that motivates them to take the action(s) you want them to take.  </li> </ul> Market is simply an understanding of who your target or "perfect" customer is.  By defining the characteristics or considerations for your "perfect fit" customers, you will generally find yourself targeting fewer customers in your marketing efforts.  By doing this, you will reach more of the people who are more inclined to buy your product or service set.  This will increase the cost effectiveness of your marketing efforts.  Let's start by looking at your current customers and finding out what are the things about them that seem to be the most common among them.  Here are some questions you can use to start identifying these characteristics: <ul> <li>Are there geographic limitations & similarities:  How far do your regular customers live or work from your establishment?  Does being close to your location really matter to them when buying from you on a consistent basis?  For a coffee shop, location is pretty critical; for a consulting business, probably not so much.  How about for your business?  Create a list of these, if any.</li> <li>Transaction frequency.  How often do your best customers use your business?  How often do you want them to?  Does your business need continuous, repeat visits from customers to be profitable or does it lend itself to a single purchase for your profitability?  A coffee shop relies on very frequent purchases from the same customer; a home roofing firm looks for a many single purchases from alot of different customers.  What variables drive the frequency of their purchase habits for your business?</li> <li>Are there physical aspects, limitations or similarities of the customer:  age, gender, height/size, physically fit or not, and other physically related attributes.  Do you find any of these that seem to be more dominant that others?  We all know of a major national fitness center chain that focuses on women only, a very specific target definition for their business.  Yet, other national fitness chains work with both male & female customers at the same time and in the same facility.  Each have defined their preferred target market alittle differently.  Does your business have any leanings towards any of these characteristics?  Create a list of them.</li> <li>Are there financial or income related considerations:  Do they have to own a home or not?  Is affordability an issue?  Would you try to market a brand new Mercedes to a person making under $30,000 per year?  NO?  Why not?  Probably because they can't afford it.  I suggest that this would not be the preferred market segment for a Mercedes dealership.  What is the typical financial situation of your current customer base?  This will also help you find the most profitable segments of your market.  Is this important for you to know?  I suspect it is.</li> <li>Customer Ego or Value Perceptions:  Does your product or service fill a "need" or a "want" of the customer?  Let's use another auto example:  Transportation: Need or Want?  Is driving a Jaguar a need or a want?  How about driving a Ford or Chevy?  Is an ego or value perception driving this particular purchase?   Though both do the job in getting you between places, I submit that driving a Jaguar is more of a want or ego based decision compared to driving a Ford.  Every customer makes a value judgment about the products they want & need.  What values or perceptions drive your product or service set?  </li> </ul> I have found that just putting this list together puts you ahead of many other business.  Businesses I have worked with had not done this before and by doing so have learned alot more about making their business stronger.  Many owners just open their business with the idea that "everyone is my prospect."  They then spend a lot of their marketing effort targeting people who are not really a fit for their business.  This is what you want your competitors to do - it leaves them more vulnerable to your efforts to "steal" market share from them. You now have a better idea who is a "perfect fit" for your products or service.  You can begin to tailor your marketing to their particular needs rather than a more generic need.  You will probably also find yourself with a long term advantage over your competitors just by being more knowledgeable about your target market.  Let them "spend more" on ineffective marketing and use up their profit margin foolishly.   Once you have put together this list of all of these characteristics and considerations that you have uncovered, validate its accuracy.  Have a couple of your best customers take a look at your combined list and provide feedback to help ensure you have them all as well as being able to prioritize them.  An added benefit to asking them is they will generally be very pleased to have been asked and will now take alittle more "ownership" in the health & growth of your business.   You will probably find out that some of your customers do not really fit into your target market very easily.  That's okay.  If they have been good customers, fine; keep them.  If they haven't been a good customer or become unreliable, now you know what to look for in avoiding these customers in the future who can be a drain on your business.  What this does is allow you to begin to improve your marketing effectiveness by "reducing" the number of people you are targeting.  Less is more in this situation since you are hitting those folks who are most likely to buy from you.  You are doing less marketing to people who would probably not buy from you anyway; what an amazing concept.  More bang for your buck.  Imagine that. Now that you have the target market defined in great detail, you will be able to start figuring out how to reach them more effectively.  Also you will be able to better understand what will motivate them towards the action you want them to take.  Can this help with both your new customer AND your current customer market efforts?  Sure it can.  You will know what "buttons" to push to increase their purchase activity or get their business in the first place.  WOW!!!  (The Offer.) Keep this list handy.  My next article will be about how to use this list to figure out which Package (marketing methods, strategies & tactics) will help you reach out to your newly defined target market.  A future article will cover the Offer component as well. Good luck & Happy Marketing! 2009-03-25T01:44:41Z

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2009-03-25T05:56:44Z

Who is your 'Perfect Fit' Customer? This article offers a model to help figure out what the characteristics and/or limitations are for their target market. With this knowledge, the member is more able to focus their marketing efforts.