segmentation

Single Target Market – Once Again

Marketing, messaging, Product Management, segmentation, single target market

These three words are so deep in their meaning if you are in any way involved with Product Management or Marketing.

While classic marketing talks about identifying a problem in the market and then coming out with a solution. In a lot of cases , especially when it comes to technology marketing, as new technology starts becoming available you work on building new use case scenarios and then going out to the market to sell it.

In these cases you have the ability to fine tune the product for specific markets, but inherently you don’t have the ability to create a brand new product after identifying a product. Start-ups do have the ability to identify niches in the market where problems are unsolved and create from scratch. For most of us who work on the quarter by quarter revenue targets we have to look for the segments which have a problem , that our solution can solve.

For these situations the Single Target Market is the most important item in my view. Its one step deeper than just segmentation which is taught. Here we are also looking at going further down the segmenting exercise with the usage involved.

As an example you may have a product which is a car stereo. Lets assume that it has the ability to connect with 8 speakers and therefore the segment becomes only those cars which have the ability to have 8 speakers. Now if you are getting in new with this product – you can go to the OEM who is making the car and ask them to incorporate it into their car. On the other hand you can take this same car stereo and sell it to the “after market” dealers as a replacement of faulty stereos.

The messaging you have to do to connect with the 2 different types of markets is different. Now lets go to target the “after market” niche further by looking to say a specific state like California to start with, versus looking at a state like Georgia. The accent of the message is totally different. So now you are targeting the auto shops which provide repair services for cars of the luxury kind in a state like Georgia.

Each time I try to do a Single Target Market analysis – I learn a little more about how you can get a finer market to target.

Why is this important – all your advertising, messaging, triggers, the logistics of reaching your market- everything becomes easier and more focussed, which leads us to success.

Till next time then…..

Carpe Diem!!!

Boredom in marketing …. cause for distraction – Part 3

Distractions, ideal customer, Marketing, messaging, segmentation, single target market

People have such a low attention span these days, that, anything that even remotely screams marketing, gets thrown into the delete mode even without a second thought. With electronic messaging this is even more convenient.

So while electronic messaging via email or via social media can get you very targeted audience, sometimes almost free, they also have the highest “ignore” rates.

While one of the reasons for the “ignore” is the massive number of unnecessary emails or messages people get, the other is because the messages don’t speak to the prospect in what’s important to him. So while they are trying to scan your subject line / headline , and if your message is boring, an alert pops up on their cell phone and they get drawn into it and you have lost that small window of opportunity.

Understanding what is going on in the mind of the prospect is critical – what conversations she could be having, are critical to ensuring that you are not boring. You can do this kind of specific messaging only if you have segmented the market so well, that the conversations start to become evident.

In any given market segment there will always be the early adopters, the laggards, the fence sitters etc. What is the use case that you are targeting will decide within the segment what is your Single Target Market to start your messaging with. If you are targeting the replacement market then you go with a different kind of messaging, while if you are targeting the early adopters you need to be looking at how your message can play to their vanity of being early adopters.

Creating messaging is a very time consuming job and requires a lot of subtle changes in the language. Whenever I have tried to get something out in a hurry, because the team was in a hurry, those campaigns have bombed for us. And the time which I saved at the beginning has actually resulted in a much larger waste. Boring messages, motherhood statements, just get people to select delete because of the plethora of other distractions which exist.

Till next time then. Don’t let your marketing get boring.

Carpe Diem!!!

Product management concepts for a consumer company -2

B2B, differentiation, differentiation, ideal customer, Marketing, Positioning, route to market, segmentation, single target market

Product management is actually a much stronger discipline with consumer companies – both in the FMCG and White Goods space. What has happened with the e-commerce companies is that they have actually taken the whole consumer marketing concept to a different scale. Having said that, all the companies which are successful even in the e-commerce space, have followed the basics of marketing / product management to the core.

What started this series of posts was the fact that while these companies were burning massive cash, they were still enjoying heavy premiums when they get listed in the stock market. So is it that they are blindly burning cash or is there a method to the madness.

I highlighted some of the concepts in yesterday’s post. Today let’s look at other things like Single Target Market. Amazon today is a very big market place where they sell their own products as well as provide a platform for others to sell and take a commission on items sold. But Amazon only started by selling books initially. They did not try to get into selling everything at once. And they just sold books first in the Americas before expanding.

Look at another company Uber – they were only the ride hailing App. They did not get into the Uber Eats or the Uber Connect till they had taken a dominant position in that market. Similarly Zappos – which is now part of Amazon – was only into selling shoes.

Generally when I talk of concepts and give ideas for targeting the customers, building partnerships, I speak from the perspective of a small or mid-sized company which is wanting to get into the market. So some of the ideas are very specific.

However the same concepts at a different level are also applicable over the e-commerce space. So while Amazon is a big daddy in the retail products space, a small start-up in India “Nykaa” started with just selling cosmetics and related products to ladies. Today if you want even a French perfume in India, your first port (in this case App) of choice would be Nykaa. Its become such a big brand for the cosmetics and related categories. Similarly in the fashion space its “Myntra”. These companies segmented the market even within e-commerce and specialised in certain areas and have made a success out of it.

So principles of marketing and product management won’t change, what could change is the scale, the risk and the delivery mechanisms.

Till next time then.

Carpe Diem!!!

Diversification is admission of ignorance

B2B, ideal customer, Marketing, messaging, prioritizing, Product Management, segmentation, single target market

A few posts back I had written a post on how giving too many choices actually reduces the chance of success.

I used to hear a lot of gurus in the stock market talk about being focused with not more than 10-15 stocks to get the best returns. If you read the Wealth Creation studies by Raamdeo Aggarwal, he gives a lot of examples of how being focused can give much higher returns. If you want average returns then you can just take an Index ETF.

The other day I was listening to an interview of Garrett Gunderson with Joe Polish on YouTube. And he happened to mention this term in passing and it kind of stuck with me. Garrett has written a very nice book Killing Sacred Cows: Overcoming the Financial Myths that are Destroying your Prosperity.

Even in marketing if you try to do too many things trying to see which will succeed is because you are not sure of yourself either on your offering or on your market or a whole lot of other things. Most of the time we try to do multiple things at the testing stage to see what sticks and what falls. But once you start seeing what sticks you need to start improving on that. You can’t be testing multiple variables simultaneously. It never works.

You cannot be testing multiple offerings in different markets and also seeing which message works. I have done this at different times and flopped badly. Sometimes these were done because I fell in love with multiple brands and thought I could get them launched at the same time but then eventually realized I could not do justice to all of them. It was definitely my ignorance then. At other times I was in a tight spot and had to somehow get something moving and thought at least if a try so many things simultaneously, I will be able to get success somewhere.

Eventually I have come down to some very specific things for B2B marketing. I need to identify only one target market and niche it as much as possible when I am launching a new product / service. If your segmentation is done well and then you get your database / list based on that you have already come a long way. After that you test your messaging.

The 80/20 that I have been talking about in the last few posts is exactly the opposite of diversification. Its about focus and the knowledge which comes from focus. Like the image above, a few colors in a pattern can give a good look but putting too many colors on the same rug, assuming some one will like some color is ignorance.

Whether its finance or marketing or even other areas of your life you can spread your self, diversify and be shallow and ignorant or go deep, focus and be knowledgeable and get great results.

Till next time then.

Carpe Diem!!!