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Marketing Tactics

Defining Your Market in 7 Steps

You’ve come up with a great idea for a business but you’re not ready to roll yet. Before you go any further, the next step is figuring out who your market is.

Entrepreneur

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There are two basic markets you can sell to: Consumer and business. These divisions are fairly obvious. For example, if you are selling women’s clothing from a retail store, your target market is consumers; if you are selling office supplies, your target market is businesses (this is referred to as ‘B2B’ sales).

In some cases – for example, if you run a printing business – you may be marketing to both businesses and individual consumers.

No business, particularly a small one, can be all things to all people. The more narrowly you can define your target market, the better.

This process is known as creating a niche and is key to success for even the biggest companies. Mr Price and Sterns are both retailers, but they have very different niches: Mr Price caters to bargain-minded shoppers, while Sterns appeals to upscale jewelry consumers.

“Many people talk about ‘finding’ a niche as if it were something under a rock or at the end of the rainbow, ready-made. That is nonsense,” says Lynda Falkenstein, author of Nichecraft: Using Your Specialness to Focus Your Business, Corner Your Market & Make Customers Seek You Out.Good niches do not just fall into your lap; they must be very carefully crafted.

Rather than creating a niche, many entrepreneurs make the mistake of falling into the “all over the map” trap, claiming they can do many things and be good at all of them.

These people quickly learn a tough lesson, Falkenstein warns: “Smaller is bigger in business, and smaller is not all over the map; it’s highly focused.”

Practicing Niche-craft

Creating a good niche, advises Falkenstein, involves following a seven-step process:

1. Make a wish list.

With whom do you want to do business?

Be as specific as you can: Identify the geographic range and the types of businesses or customers you want your business to target.

If you don’t know who you want to do business with, you can’t make contact. “You must recognise that you can’t do business with everybody,” cautions Falkenstein. Otherwise, you risk exhausting yourself and confusing your customers.

These days, the trend is toward smaller niches. Targeting teenagers isn’t specific enough; targeting male, black teenagers with family incomes of R120 000 and up is.

Aiming at companies that sell software is too broad; aiming at Johannesburg-based companies that provide internet software sales and training and have sales of R100 million or more is a better goal.

2. Focus.

Clarify what you want to sell, remembering: a) You can’t be all things to all people and b) ‘smaller is bigger.’ Your niche is not the same as the field in which you work.

For example, a retail clothing business is not a niche but a field. A more specific niche may be ‘maternity clothes for executive women.’ To begin this focusing process, Falkenstein suggests using these techniques to help you:

  • Make a list of things you do best and the skills implicit in each of them.
  • List your achievements.
  • Identify the most important lessons you have learned in life.
  • Look for patterns that reveal your style or approach to resolving problems.

Your niche should arise naturally from your interests and experience. For example, if you spent 10 years working in a consulting firm, but also spent ten years working for a small, family-owned business, you may decide to start a consulting business that specialises in small, family-owned companies.

3. Describe the customer’s worldview.

A successful business uses what Falkenstein calls the Platinum Rule: ‘Do unto others as they would do unto themselves.’

When you look at the world from your prospective customers’ perspective, you can identify their needs or wants. The best way to do this is to talk to prospective customers and identify their main concerns.

4. Synthesise.

At this stage, your niche should begin to take shape as your ideas and the client’s needs and wants coalesce to create something new. A good niche has five qualities:

  • It takes you where you want to go – in other words, it conforms to your long-term vision.
  • Somebody else wants it – namely, customers.
  • It’s carefully planned.
  • It’s one-of-a-kind, the ‘only game in town.’
  • It evolves, allowing you to develop different profit centers and still retain the core business, thus ensuring long-term success.

5. Evaluate.

Now it’s time to evaluate your proposed product or service against the five criteria in Step 4. Perhaps you’ll find that the niche you had in mind requires more business travel than you’re ready for.

That means it doesn’t fulfill one of the above criteria – it won’t take you where you want to go. So scrap it, and move on to the next idea.

6. Test.

Once you have a match between niche and product, test-market it. “Give people an opportunity to buy your product or service – not just theoretically but actually putting it out there,” suggests Falkenstein.

This can be done by offering samples, such as a free mini-seminar or a sample copy of your newsletter. The test shouldn’t cost you a lot of money: “If you spend huge amounts of money on the initial market test, you are probably doing it wrong,” she says.

7. Go for it.

It’s time to implement your idea. For many entrepreneurs, this is the most difficult stage.

But fear not: If you did your homework, entering the market will be a calculated risk, not just a gamble.

Entrepreneur Magazine is South Africa's top read business publication with the highest readership per month according to AMPS. The title has won seven major publishing excellence awards since it's launch in 2006. Entrepreneur Magazine is the "how-to" handbook for growing companies. Find us on Google+ here.

Marketing Tactics

Top Marketing Trends For 2019

When you reflect on marketing trends that have taken centre stage in 2018, what stands out?

Emma Donovan

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Maybe it’s the proliferation of Instagram stories or  influencer marketing? Or the fact that video content has become even shorter and simpler with the rise of GIFs.

The real question is how have you incorporated these trends in to your marketing strategy, and what should you focus on in 2019? Here are six up and coming trends that you don’t want to miss:

1. Say hello to the social CEO

Customers want ‘real’ brand stories and to know what drives them. Leaders who are successful on social media show their companies’ human side and give their brands’ credibility and personality. This builds loyalty and, in some cases, an emotional connection that goes beyond the product or service.

Customers who feel this connection may even go on to become brand ambassadors.

Tip: Share stories that demonstrate your leadership style as well as company culture.

2. Initiate conversations

While 2018 brought the chatbots, the trend for 2019 is really using these bots to gather information about consumers by engaging with them on a personal level and steering them towards a sale. Bots are being trained to be authentic and sound more like people than the robots they are.

For example Facebook Messenger becomes more and more useful for brands as the platform allows customisation of automated messages and the ability to initiate a conversation at the right time.

Tip: You can also integrate this with Facebook shopping and increase conversion rates by enabling the bot to sell products to a consumer through the Facebook platform.

Related: Pay Per Click Advertising. When, How And For What?

3. Keep it local

Influencer marketing can be short lived or a little superficial. So try to identify and partner with local influencers that are happy to work on long-term campaigns. Also use multiple touch points including podcasts, YouTube and Snapchat as well as Instagram and Facebook.

Tip: Before you reach out to an influencer, follow them and learn a bit about the way they represent brands and engage with their fans to see if they’ll be a good fit. 

4. Try Instagram ads

As Facebook ads continue to dominate our feeds, advertisers are looking for a new place to stand out and get noticed. Instagram ads are on the rise, according to the Merkle report that showed that while Facebook ad spend grew 40% year-on-year in the second quarter of 2018, Instagram ad spend jumped 177% in the same time period.

Tip: Do some A/B split testing with different styles of images and calls-to-action.

5. Personalise email communication

Make sure to use automation and personalisation to really make your customers feel that you are listening.

Using hyper-segmentation, you can target very specific parts of your market. This will ensure that they receive personalised emails based on what they have expressed interest in or actions they have taken with regards to your brand.

Tip: Use automated campaigns after a first purchase; to request a review on social platforms; or just thank customers for shopping and remind them to share their purchase online.

Related: Free Sample Marketing Plan Template

6. Post in real time

In an effort to bring offline marketing into the online world, Instagram TV or IGTV allows brands to create a place for consumers to watch live events or brand content in their own time.

In addition, IGTV replaces the need for YouTube in some cases as brands are able to upload 10 or more minutes of footage directly to Instagram for consumers to watch as ‘episodes’.

This will become more prevalent in the years to come as businesses include this in their strategy. IGTV videos are less formal and will typically cost less than a traditional TV advert to create.

Whatever trends come our way, the key is to remain agile and adapt to how customers engage with your brand. And more than ever before, it’s important for all marketing touch points to align and communicate the same message.

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Marketing Tactics

4 Young Marketing Influencers You Can Learn From

Whether you’re a CMO or just trying to build your own brand, these influencers can help you reach your goal.

Jonathan Long

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Today, social media is a very crowded and competitive ecosystem – it can be extremely difficult for brands to break through and spread their message to a large number of potential new customers.

Marketing via social media has become a necessity. According to a post by DMA, 45 percent of surveyed marketers are looking to increase brand awareness through social media. The same post stated that spending via social media is expected to increase 18.5 percent in the next five years.

This article was originally posted here on Entrepreneur.com.

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Marketing Tactics

The Fifth P Is The Most Crucial

The reasoning is simple. If you don’t know your market, you will never be able to understand how the 4Ps apply to your potential customers.

Kyle Rolfe

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The four Ps of the Marketing Mix (Product, Price, Promotion, and Place) have defined marketing campaigns, both successful and unsuccessful, for many years since E. Jerome McCarthy came up with the concept in 1960. And while there have been tremendous advances and innovations in marketing, the four Ps (4P) are still first on the list in any marketing course.

In the brand conscious society in which we live today, however, a fifth P has become the cornerstone to all marketing and branding exercises, whether you’re in the business-to-business or business-to-consumer market. The fifth P is People or is also referred to as Personalisation.

The reasoning is simple. If you don’t know your market, you will never be able to understand how the 4Ps apply to your potential customers:

  1. What products do they want?
  2. Where should you make them available?
  3. How to price your products to meet your market’s requirements and budget?
  4. How and where to promote your product?

The first step in defining your marketing strategy should be should be getting to know your customers. When you know who you are targeting and put people at the centre of the mix, you can more easily decide the optimal strategy that will deliver the most favourable results.


Airbnb example

Airbnb has built a valuable brand by making the 5th P a focus of it’s branding activities. They typically target millennials born 1980-2000 and it’s understanding their traits (needs and principles) that has been the key to their success. Let’s look at how this impacts each subsequent P individually.

Related: How To Make (A Lot Of) Money On Airbnb


1. Product

Spending with a conscience is core to most millennials and they tend to opt for products that allow for transparent traceability throughout the supply chain. Airbnb is not seen as a large corporate ripping off the little guy, but creates a community where everyone contributes and benefits from something seen as open, transparent and disruptive to the status quo. The company has no real assets, but its brand has the visibility of a Coca Cola or Starbucks in the millennial market.

2. Price

While its market is cost conscious, Airbnb knows they place a higher value on products and services that have been designed and developed in a manner that is good for people and the planet. Hence, by consuming the brand they become“part of the solution”.

Airbnb is, more than anything else, including its multi-billion dollar valuation, a community organisation that includes everyone from anywhere. Add to that the lower costs and almost limitless offerings, in general, and you have something their market can’t say no to. Airbnb is a real part of their culture and value system, not some fake corporation pretending to be ‘cool’.

3. Promotion

In terms of promotions, understanding their market is apprehensive of contracts and long-term commitments. Airbnb has none, you make a deal with an owner or someone looking to rent for a while and that’s it, no fuss. In an interview with Fast Company, Airbnb’s head of brand, Nancy King said one of the key reasons for Airbnb’s success “is all about emotional connection, and that is really the root of it”. She continues that,

“Iconic brands have a disproportionate share of cultural voice, and they hold the internal culture of companies.” And it’s clear that Airbnb has developed that cultural integration with millennial values.

Related: How To Drive Customer Referrals (When You Aren’t Airbnb, Dropbox or Uber)

4. Place

Convenience and accessibility is important to most markets, but millennials place an even higher priority on it. They want information right away, especially for online sales, and once bought they want to know where their product is in the supply chain until it arrives at the door.

In the case of Airbnb, your booking information is available everywhere and anywhere, on any device. And as part of the community culture it drives, its biggest brand builders are the word-of-mouth promotions its customers created in the natural flow of conversation, online and offline

“Airbnb is an amazing example of how a brand is the value of a company, in this case valued in the billions of dollars ($38 billion at the time of writing, according to Forbes),”  adds Rolfe. “This value is based on the value of its community, its culture and the way its partners (buyers and sellers) value what the brand can do for them, not the value of sales pipelines or fixed assets.

“This is a $38 billion valuation based on brand alone, based on the company’s ability to identify its market and create the community (not the business strategy) that appeals to them. In other words, the other four Ps are determined and led by a clear and intense understanding of the 5th P, the people who give Airbnb its value.”

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