When you have a new business idea that you’re working on, it’s easy to get excited about launching your product or service into the world and to focus on creating a beautiful website, writing posts for social media, and getting lots of PR for your fabulous new business. There’s an important step that comes before this, however, a step that we often gloss over: who are you actually targeting i.e. who is your target group? Answering this question, and answering it well, is critical to being able to do all those other things effectively.
The internet means that we can talk to, and sell to, customers all around the world. The fact that you can reach anyone in the world, however, doesn’t mean that you should. We often want to cater to everyone because we feel like we have something of value that we want to share with as many people as possible and, less altruistically but also important, we want to make more money.
This is not an effective strategy, however – in fact, it’s not a strategy at all.
Strategy is all about CHOICES.
An effective business strategy will include choices when it comes to things like geographies i.e. which are your priority countries (or more specific e.g. cities or regions), customers (demographics and psychographics), product categories, and channels (online platforms, social networks, offline locations).
For some reason, making these choices can be really difficult. When asked who their target is, many entrepreneurs and business owners will give a very vague and general answer.
But, as my friend and fellow marketing consultant says, “‘Humans who breathe’ is not a target group!” (Watch Serena De Maio’s recent Tedx talk on How Marketing Can Help You Find Love Online.)
So why is it important to get your target group right?
Let’s take this ‘humans who breathe’ target group as an example (a bit extreme, yes, but not so far from the reality in many cases). How are you going to reach these people? Where are they spending their time? Where are they most receptive to your message? How will you best formulate that message so as to appeal to their needs and desires?
Using a broad definition means that you will be spreading your marketing efforts very thin: across different countries, different age groups, different online platforms… You won’t be able to understand who you’re selling to, as there are just too many variables across such a disparate group, and so you won’t be able to design a product or service, write copy, create a marketing campaign, etc. that will speak directly to that group.
As the saying goes: You can please all of the people some of the time, and you can please some of the people all of the time; but you can’t please all of the people all of the time.
Imagine if someone’s searching for what you provide online. First of all, it’s almost impossible for you to appear high up in the search results if you have a very general offering – competition will be high for generic keywords. Second, even if they do find you, it will be difficult for you to get them sufficiently interested to click through to your site and, then, to stay there.
How can you ensure that your message resonates with their particular needs and wants if you don’t know who these people are?
As another saying goes, it’s better to be a big fish in a small pond than a small fish in a big pond. You’re more likely to be top of mind, to get referrals and to become known in your area if you become the go-to person, brand or company for a particular problem or need. You can always make the pond bigger once you’re well established with that first target group! In the meantime, getting more specific will allow you to focus your time and money where it counts.
Rather than trying to target the mass market right away, this theory suggests that you should aim for the innovators and the early adopters. These are the ones who ‘get it’, who stood in line for hours to get their hands on the first iPhone rather than wait until it was out for general purchase. You might also consider targeting a small group of individual influencers, who will recommend the product or service to their followers, rather than going directly for the masses. Having Taylor Swift seen to be using your amazing new whatsit will have her Swifties running out to buy one before you can say Shake it off!
The rest of the population – the early and late majority, not to mention the laggards – are not going to buy until a given amount of time has passed and your brand or offering has become sufficiently established to start to be mainstream.
Of course, it’s difficult to know up front whether you’ve chosen the “right” target group or not. That’s why people like Tim Ferriss (of The 4-Hour Work Week) and Eric Ries (of The Lean Startup) recommend putting out an MVP (minimum viable product) and testing and learning before you invest in a full product and brand ecosystem.
It’s better to find out that your target group is completely uninterested in your product sooner rather than later!
So defining your target group will help you to design a better offering, communicate the right message in a relevant way, and reach the right people in the right place at the right time – all within your limited budget! Have I convinced you?
Next week, we’ll look at how you can narrow down your target group.