Looking for a quick way to send your business into the tank? Try this proven approach.
Instead of having a compelling brand that resonates with specific target audience segment(s), position your business to be all things to all people. Not only will prospects and customers be confused about who you are, what you do and the benefits you deliver, so will your employees. Before long, your brand will look and act like a politician running for office – promising the world to everyone but not standing for anything in particular.
If you prefer to build a business that is profitable and successful for the long-term, we recommend a different approach, one that addresses a clearly defined market segment (or segments) with laser-like precision. Many companies resist this approach. Partly because it requires a lot of work, but mainly because they feel it limits their market and reduces their opportunities – neither of which is correct.
Serving a well-defined market is critical for success because it helps you pursue the right opportunities. Trying to be all things to everyone waters down your message, and you end up with a shotgun approach to your marketing. Companies that present focused messaging targeted to their audience will inevitably have more success (unless they’re total goofballs on the operational side of the business) because they don’t waste time and money chasing opportunities that don’t fit their business.
That’s why marketing begins with segmentation. Until you understand which segment(s) of the market your product or service will appeal to, and which will be most profitable, any attempts to build a compelling and differentiated brand will likely end in failure.
Defining Your Market Segment
It starts with conducting extensive research across your broad market to identify which segments find your product or service most appealing, and to what degree and intensity. From there, it’s a matter of understanding everything you can about them:
- What are their pain points?
- How does your product or service solve their problems or make their lives better?
- How do they make buying decisions?
- Why do they buy from you rather than your competitors?
- What are the barriers that might prevent them from trying your product or service?
A market segment can be defined in different ways. In the business-to-consumer (B2C) space, a market segment can be defined by demographics (age, income, etc.) psychographics, behavior, category usage (heavy users vs. light), and even geographic location.
In the business-to-business space (B2B), segmentation is a little less diverse. Segment definitions in this space include geographic focus, organization size and industry vertical For example, a law firm may focus on small-to-mid sized biotech firms in the San Diego market.
One big difference between B2C and B2B is the power of market influencers – those who can affect the buying decision. The power of influencers in B2C can vary widely. When parents buy toys for their children, the kids can influence the purchase to a large extent. In other situations, such as buying a new car, not so much.
In B2B, an influencer can flat out kill a deal. Suppose the CEO of a company wants to get a new type of software. If the CTO says it would be challenging to integrate into the existing platform, the deal isn’t going to happen, no matter how much the head honcho likes the software.
What Targeting Your Market Does For You
The benefits of addressing a clearly defined target market practically leap off the page. Knowing everything about your segment allows you to spend your marketing dollars more efficiently and effectively by targeting the right buyers. Your messaging will be more focused and will resonate at a deeper level with prospects and customer since your point of difference (we’ll discuss that more in a future blog) will matter much more to them.
Highly targeted marketing generates more revenue and profit per customer. It also creates greater brand loyalty, so you can spend less time and resources seeking new customers to replace the ones that left. Perhaps most important, understanding your segment identifies who your brand should address, what it should say to them, and how it should make them feel. Effectively conveying both the rational and emotional benefits is what bonds a brand to a receptive target market.
Ultimately, building a powerful brand comes back to the willingness to let go of having a wider audience. Focus is the key. Figure out who should be your customer and why. Then learn everything you can about them, including the subtle nuances that make your target audience unique.
This is where BottomLine Marketing excels. We help companies identify patterns and uncover ways customers think that unlock different benefits for success. We then incorporate these discoveries into a coherent brand strategy and (if the client asks for it) a comprehensive marketing plan to support it.
Here’s what makes branding so challenging and (to us) so much fun. No matter what business you’re in, your target market is constantly evolving. Which means your brand must evolve with it. Otherwise it becomes irrelevant. And trust us on this one – it’s a lot easier to evolve a brand than to start all over again.
What are your biggest branding challenges? If you would like to talk it through with our experienced brand gurus, we’re here to help.