In business school, the subject of defining target markets comes up repeatedly. Define the market with demographics and psychographics, don’t be too general, don’t narrow it down too much, do your research and slice that pie!!
Although identifying your target market is undoubtedly an important step in creating your overall marketing plan, I think a lot of small business owners get lost in the technical lingo and either try to market to everyone or fail to formulate a plan at all. As someone who’s not a fan of the “Ready, Aim, Fire” approach, I want to share my take on how small business owners can better understand their target customers.
1. Define the original purpose of your business. Yes, again. Many small business owners who are fighting for enough business to turn a profit lose sight of their original goals. Stop for a second and write down why you are in business. What product or service are you offering? Be specific and try to remember why you started your company in the first place. Did you want to help others? Was your goal to get rich? Did you desire to make a name for yourself? Whatever the reason, get back in touch with that logic. Make sure it still applies, and reaffirm your commitment to doing business the way you always intended. If you don’t take this first step to defining your overall business goal, then you can’t very well understand your target market.
2. Look at the the customer base you currently have. Who is using your service? What is the average person who buys your product like? Instead of trying to come up with an age, sex, income level, etc. for your target customer based on what you think your target customer looks like, take a hard look at what they actually look like. You may be surprised at what you find, but effective marketing is aimed at the people who want to buy your products, not at the ones you think should be buying them.
3. Connect the dots. Once you are 100% committed to your business goals and you have a good idea of who your most frequent customers are, all you have to do is put the pieces together. Find a creative way to show those target customers your business meets a need they currently have or will have in the near future. When I reach out to potential clients, I like to consider the lifestyle of my target customers and show them how my business fits in with and improves that lifestyle. You have to find the approach that works best for your business, and if you have a hard time with this step it may be a good idea to seek the advice of a business consultant.
I know the demographic/geographic/whatevergraphic approach to market definition serves its purpose, especially when applied by professionals and academic experts. But if you are the average small business owner, then you may not have the knowledge or the patience to wade through the jargon.
My advice: Understand that marketing to the appropriate customers is a worthy investment, and apply whatever method allows you to focus on and reach those customers.
I recently had a marketing inquiry from a small business owner in Cabo who needs help with her web pages. Her concern was that I would not be able to work with her budget, since she recently spent too much on advertising already and is still not seeing the traffic she hoped for.
Her budget I can work with. I really try to work with any budget so the business owner can see results as soon as possible. But her mistake in spending on the wrong type of marketing really got me thinking. I want to share some simple Dos and Donts for small businesses so overspending in the wrong marketing areas can be minimized.
1. Do make setting up a website and social media pages a priority. In today’s world, a business without a website is easily forgettable. Many customers investigate a company’s reputation online before paying for their products/services, so if you don’t have a website you automatically lose a bit of credibility. The same goes for social media–these days businesses are expected to be connected, so take advantage of the free networking opportunities and create some basic social media pages.
2. Do use your connections in the community to publicize your business. Attend networking parties and events to pass out business cards and meet new contacts. Write your own press releases and send them to local newspapers, magazines and online journals. A press release does not have to be perfect, just look up the format and write about your new business or your new product launch. If you already have a blog or social network page, publicize the businesses you know and trust in the area–many will pay you back with free advertising on their own pages or via word-of-mouth referrals.
3. Do follow up on every customer inquiry or comment. This is especially important at the beginning. Think of building your network as an investment. It truly is.
1. Don’t spend money on print ads, no matter how tempting the deal or how convincing the salesperson is. Take it from a Journalism major, print is a dying business. The chances are high that your ad will be tossed out before it’s even seen by a majority of readers. You’ll have far more reach with online networking–the world is literally your audience online.
2. Don’t pay a web developer to do your website until you investigate all your options. Sites such as WordPress or Weebly allow you to build your own basic website for free. I encourage you to take a look at these sites and explore their features. Most small businesses could get by with a site built on one of these platforms while you start generating income, and they really are easy to use even if you know nothing about web programming. You may be able to save thousands by doing your own website or by paying a friend to set it up for you using one of these sites.
3. Don’t use your personal social media pages as your business pages. No matter how much you feel your business reflects your personal life, it just takes one photo of you after hours or on vacation to give a new client the wrong idea. Don’t risk tarnishing your business reputation with a personal comment that can be taken out of context on your personal social media pages. If you keep the business pages separate, you will also likely give more thought to the content you post.
I hope these rules help you navigate the tricky waters of marketing your small business on a budget. It can be difficult, but the results of effective, affordable marketing can be so rewarding when you start earning greater profits.