In order for companies to achieve their sales goals, they need to reach the right audiences with the right messages at the right time. In some cases, products and services are very specific and are appropriate for a very small, well-defined marketplace. For others, the appeal can be widespread, enabling companies to tweak their products or services for multiple industries. In both cases, knowing the profile, needs, habits and challenges of buyers is vital for generating revenue. This is called target marketing.
Four Types of Target Marketing
Before you can dive into the details of target marketing, consider these common marketing approaches to identify the best communications strategy for your audiences.
- Mass marketing (or undifferentiated marketing) is the most encompassing marketing technique and essentially ignores segmentation. In mass marketing, the organization sells to the largest audience possible and markets to each industry or segment in the same way. Communication is less personalized, regionally widespread and utilizes a universal value proposition. This marketing approach makes sense for products and services that have common or staple use. Common examples include B2C products such as toothpaste or dish soap, but B2B staples exist as well. Think required materials such as PCs, word processors, storage (physical or Cloud) and technology. Competition is based more on brand differentiation and brand loyalty than creating or identifying a demand.
- Differentiated marketing is a strategy that provides separate communications or offerings to different segments of the market. Another common term for this strategy is multi-segment marketing. Some areas of segmentation are straightforward, while others require more nuanced research. For example, companies like Salesforce organize their products and solutions by business type, role, industry and need. Products and corresponding marketing outreach are scaled by business criteria. Categories to determine segments include:
- Demographic criteria, such as age, location, gender, ethnicity, education, professional role or stakeholder level.
- Psychographic criteria, such as needs, priorities, values, beliefs and interests.
- Behavioral criteria, such as purchasing habits, customer loyalty, usage habits, click and heat mapping, buyer journey stage, occasion or timing.
- Company criteria (also known as firmographic criteria), such as industry, company size, budget and business performance.
Research shows that 83 percent of companies use at least basic segmentation for their email campaigns. Consider how it may be utilized in content marketing, advertising, social media and media outreach. Differentiated marketing that addresses the challenges of multiple market segments is a versatile marketing approach that allows for varied, personalized and need-based tactics.
- Niche marketing is also known as concentrated marketing. This type of marketing focuses on serving a select part of the market with highly specific needs, demographic or challenges. While it may seem limiting, a niche product or service can be an advantage, rather than a shortcoming. When your target market is made up of a smaller pool, trending challenges can often become easier to identify. Consider this niche example: Shoes For Crews is an organization the develops shoes, mats and accessories specifically for workplaces that require slip-resistant, comfortable footwear. With a unique understanding of its specified target market, the company is able to address exactly what professionals in that industry require in footwear. Successful niche marketing is reliant on consistent communication with your prospects and current clients to keep a pulse on the segment. Outreach to more specific, defined prospects can allow for focused budgets, time and skillsets.
- Micromarketing (or customized marketing) takes the concept of niche marketing to a more individualized degree. One form of micromarketing is account-based marketing, which focuses sales and marketing resources on a clearly defined group of target accounts. This is a strong option for companies with clients that have a high yield and represent the “best fit” for the organization. Local marketing is another form of customized marketing. This strategy focuses on a specific geographic location and leverages its understanding of that locale’s needs and challenges. Micromarketing is a powerful choice to develop relationships and provide clients with their highly individualized needs.
Mix It Up
Identifying your target marketing is the foundation of business planning. Gathering information about your target audience isn’t a one-time event. As long as you are in business, you need to think about how you can better understand your ideal customer. As the marketplace changes, so will your target market. Globalization and technology create an ever-evolving environment. In addition to continually looking for new markets to enter, consider modifying and adding features to your current products or service or developing new ones to offer to your existing customers.
Remember, targeting a specific market does not mean you are excluding potential customers. Instead, it allows you to focus your marketing dollars, messages and resources on a specific audience that is more likely to buy from you. The level of targeting that works best for your company will depend on your product or service, company size, budget and company goals. Don’t bite off more than you can chew, but also don’t limit yourself if it’s time to scale up. It’s easy to fall on either side of the spectrum. The key is to test, collect data and take stock of your successes and shortcomings to continue to reflect your company’s best methods to address the needs of your target markets.
