The big mistake web developers and marketers make is jumping straight into the strategy without quantifying their desired outcome. The entire point of a strategy is that it’s a means of achieving an objective. Without an objective, your go-to-market strategy is aimless.
And the first strategic decision that usually gets made is choosing a target customer. If you choose the right customer, then you have a larger margin for error when it comes to executing your generating leads. With that in mind, here’s how you pick the right target customer.
Benefits of Identifying Your Target Audience
- You won’t waste time on inconsequential tactics.
- You won’t choose a target segment that is too small or too large.
- You will make smarter decisions on how to allocate your marketing budget.
- You’ll be able to hone in on the partners who will matter most.
- You’ll know what marketing budget to request.
Imagine, for a moment, a physical marketplace—a place where people go to buy vegetables, clothing, and tools. There aren’t just customers in that market; it is an entire ecosystem of buyers and sellers. Focusing only on customers will get you into trouble. Airbnb, for example, cannot just focus on its target customers. It must also create value for the many people who rent out their homes—i.e., it must also focus on the sellers in the marketplace.
Otherwise, the entire two-sided market would fall apart, and the marketing strategy would be unsustainable. A given target market consists of five components known as the 5Cs:
- Customers: Who are you selling to? What problems do they have?
- Company (in other words, your company): How do you solve your customers’ problems? Where can you solve it better than the current solutions?
- Collaborators (such as partners and influencers): Are you relying on partners, resellers, or platforms to help you get your product into the hands of your target customer?
- Context (such as changing environment and regulations): Is there a compelling event that’s driving a purchase now, or are there regulations you need to work around?
- Competitors: Who else is in the market? Where do you win and where do they lose? How do people solve the problem right now?
As you can see, choosing a target market is more involved than simply finding the ideal buyer. It requires studying the overall market and determining whether that is a space in which you want to participate. The customers in a particular market may be ideal, but if there are too many competitors active in the space, then it may not be viable.
Alternatively, a particular market may seem unattractive because it has a lot of competitors, but if you happen to have collaborators with a lot of clout in that market, then it could be strategically viable. As you design your go-to-market strategy, it’s important to consider all of the 5Cs, even if only in passing.
Creating Customer Avatars
To define your ideal customer, we advocate creating one or more customer avatars. It sounds very sci-fi, but an avatar is simply a fictional person that best describes your ideal customer.
You can begin to map out your customer avatar by writing down all the important attributes they should possess. Are gender and age important? What about their geographical location? Do job types, job seniority, and industry sector matter? Do they need to have certain hobbies and interests? Do they have certain skill sets?
Think about the types of people your product or service appeals to. Specify several different customer avatars if you need to, and seek to bring clarity to each profile. This exercise is helpful in its own right, to bring greater focus to your business activities, but it will prove crucial later when you begin to execute targeted advertising campaigns.
Types of Target Audiences
Hot Audience already knows you. You may have an existing customer base or mailing list of people who have bought your product or service before. These lists are fantastic for sending emails to, targeting specific areas of interest, and promoting new products. You can also upload customer email lists to Facebook or LinkedIn so that you can find and create similar audiences.
There is nothing better than selling to your existing customers. Facebook has hundreds of thousands of data points on every user profile. When you upload existing customers to create a “custom audience”, their algorithm will look for similarities in other Facebook users and create a new “lookalike audience” for you to advertise to – all of whom share similar attributes to your existing customers! This is an incredible feature for creating a warm audience.
A warm audience has some degree of awareness of you. They may find you through blogs or third-party referrals. A warm lead is often one you will need to educate about your proposition, but they are at least open to hearing from you.
A cold audience is completely unaware of you and your proposition, even if they happen to need it. The challenge of cold traffic is that it’s the hardest and most time-consuming to convert. The good thing is that cold audiences make up the largest proportion of any buying pyramid and it is from those who are unaware of you that your incremental gains will come.