This article describes the principles of targeted marketing and how it is such a powerful tool for increasing sales.
Part 2 gives practical advice on how to carry out a targeted marketing campaign using an easy-to-follow 7 stage plan.

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Targeted marketing: what is it?

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by Ian Traynor

This article describes the principles of targeted marketing and how it is such a powerful tool for increasing sales. Part 2 gives practical advice on how to carry out a targeted marketing campaign using an easy-to-follow 7 stage plan.

What is targeted marketing?

Targeted marketing is, according to the text books, "the process of distinguishing the different groups that make up a market, and developing appropriate products and marketing mixes for each target market involved."

One of the curses of today's technology-driven advertising media (and that includes the Internet) is that it is relatively easy to blanket very wide sectors of the population with your promotional message, in the hope that some of the flying bullets will find their mark. This is not only wasteful of your resources (and other people's), but it can also work against your image. Probably well over half of the 'direct' mail sent out today deserves the title 'junk' mail, because that's precisely what it is. Why is it junk?

  • It doesn't reach the right people - people who are genuine prospects
  • It doesn't communicate well - it makes it difficult for the reader to absorb the message
  • It's incorrectly addressed (which infuriates most people)
  • It doesn't attempt to address the real needs of the reader
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It's a bit like the old way of shooting down an enemy aircraft. When the target is sighted, round after round of air-burst high explosive is shot in the general direction of the target in the hopes that some of it will explode close enough to do fatal damage.

The guided missile

Today's anti-aircraft attack method is far more effective. Just one heat-seeking ground-to-air missile is released, which homes accurately in on its target.

That's what targeted marketing is all about. Recruitment agencies say that the ideal job advert will attract just one applicant, and that will be the perfect candidate for the job. Ideally, that is what all advertising should aim for. That's clearly impractical, but your advertising and promotion should be moving in that direction.

Unless you are targeting just one specific prospect (and there are occasions when you could be doing just that), practical targeted marketing could, perhaps be more accurately described as...

...Batch targeting

This is where you break your overall target market down into manageable segments - such as one specific industry, or a geographical area, or a demographic profile. The segments should not just be ones which are convenient to you, but ones which allow you to direct, to one specific target market, promotional messages which:
  • Are highly relevant to the prospects in that sector
  • Convince them that you are a specialist in their own activity / interest area
  • Show them that you can meet their own specific needs.

If, for example, you sell office equipment or consumables, you obviously have a vast market - almost every type of business. But, instead of sending out thousands of mailings to every type of business, pick out, say, stone quarries (to pick an unusual example!) You could focus on dust covers for equipment and the more rugged end of office equipment ranges.

You can demonstrate that you understand the needs of the quarrying industry. If you've got a few customers in that type of industry, you will already understand their requirements. If not, pick up the phone and without trying to sell, do a little market research amongst two or three prospects in that sector.

By showing that you are a specialist supplier, you'll stand out from all your other 'me too' competitors. This must be a significant competitive advantage. We know of an insurance broker who was just your average broker until he started to focus on selling insurance to dentists. Within two years, he was the UK's leading broker to the dental profession.

To summarise, the advantages of targeted marketing are:

  • Your attention is focused on one specific market area, which is likely to result in your marketing campaigns being far more cost- and time-efficient.
  • You appear to be a specialist in the prospective customer's own field, and you can increasingly build up a reputation as being just that.
  • Your promotion material is highly relevant to their needs, and is less likely to be junked
  • You stand out from your competitors
  • By differentiating yourself from your competitors, prospective customers are less likely to focus on price as the key issue, thus enhancing your profit margins
In Targeted Marketing: Part 2, we describe a highly practical step-by-step plan on how to implement a targeted marketing campaign.

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