The concept of target marketing is based upon the premise that groups of consumers, or prospects, will respond differently to various forms of messaging and other marketing activities. This is true in both consumer and B2B marketing research. Determining the size, scope and composition of target markets is a research exercise that often involves a market segmentation study as its foundation.
Segmentation studies rely on differing bases for their successful completion. A base could be geography, attitudes, or prior consumption behavior. Often segmentation studies are conducted in stages that involve multiple bases, e.g. starting with consumption from data within our CRM, followed by attitudes and finally geography. Understanding each segment’s preference for media and messaging is critical to the application of segmentation research.
Market researchers are tasked with bringing segmentations to ‘life’. This entails creating target profiles which will be used by creative teams to develop messaging points and the appropriate media strategy. In the following example, taken from the technology space, there are four customer profiles. Each profile is of a market segment created on the bases of factors important to the purchase decision. Seldom are segments of equal size and importance.
Number crunchers represent 15% of the market. They are bottom-line focused and compare potential suppliers based upon the cost of service. Total cost of ownership is their most import purchase concern. We can reach this group with customizable calculators that show the value of the product and that allow users to enter their own data and assumptions.
Innovators account for over half of the market and are focused on growth and how the product can make them more effective. This group responds to thought-leadership and needs to be shown how the product can impact their performance.
Service seekers (20% of the market) tend to be longer-term customers that make smaller transactions. Their high-level of customer satisfaction keeps them returning. They find the relationships they develop with a company to be critical. The key message to this group is one of comprehensive customer service. Risk avoiders (14% of the market) need to have their concerns heard. Risk avoidance drives their purchase decision therefore messaging must center on reassurance.
Effective target marketing requires discipline. It must be driven on the basis of consumer insight and regularly revisited to assure it stays aligned with overall market strategy.
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