Target Marketing refers to the practice of breaking down your market into segments and focusing your marketing efforts and resources on a specific segment or a particular group. Target marketing aims to exclude those who do not fit your criteria. Sellers are therefore able to narrow down their marketing scope and put themselves in a great position where they can have a better quality of interaction with only a selected few. Let’s quickly highlight some of the benefits of market segmentation that both the sellers and their customers realize.
Better Products And Services
Targeted marketing ensures that the needs of particular groups of consumers are at the forefront of a business' marketing efforts. This implies that a business may go the extra mile in coming up with a product that exhaustively addresses their customers' concerns and problems. These niche services and products become the competitive advantages of these brands giving them permission to charge premium prices for that level of attention. Example, concierge services for executives.
Enables Marketers To Gain Valuable Insight
Since customers’ personalities, needs, and behaviors change over time, it is vital that every business keeps up with these tiny evolutions and consistently adjust their product offerings to suit the new and arising customers’ purchasing trends. Market segmentation assists businesses to quickly gather this information because they intimately serve this niche. They are able to know which benefits of their services and product can best serve their market and how to ‘tweak’ their marketing strategies based on data of emerging social, economic, and technological trends.
A Business Can Gain Loyal Customers
For a business to gain loyal customers, it must first find potential customers who may be interested in the business and the products and services that it offers. When a business relentlessly focuses its marketing strategies towards these interested customers, the continuous engagement may assist them to convert this target audience into a very loyal customer base.
According to research conducted by the Gartner Group and Bain & Company, 80% of a business’ future profits will be realized from 20% of its existing customers, and, by increasing customer retention rates by 5%, businesses can realize an increase in profits by a mouth-watering 25% to 95%.
Brands Can Reach Audiences In A More Impactful And Personalized Way
Since targeted marketing limits the scope of your audience base, it allows you to focus your marketing message toward an audience that is contextually aligned with your business solutions. Your marketing campaigns need to get the right message to the right people at the right time for them to be effective.
Personalizing your marketing message allows you to produce a compelling message that speaks directly to your audience. This communicates that your business can address the needs of current and potential customers in a more fulfilling way than others would. Businesses Can Retain Their Competitiveness
By focusing tightly on a target market, the company can establish itself as an expert on the wants and needs of that group. It can react quickly to changes in their interests or opinions, and keep a careful eye on attempts by other firms to lure those customers away.
Its solid presence in the target market and its stronghold on this audience will act as a barrier to competitors seeking to enter the same market. This helps the business to retain a competitive edge over their rivals in the industry.
Cost-Effective And Budget-Friendly
Targeted marketing campaigns are cheaper than mass marketing strategies. In this digital age, people expect business brands to speak to them on a personal level. Targeted marketing helps businesses save a lot of money that would otherwise be overspent in their marketing and lead generation expenses.
Instead of the expense of a high volume that mass marketing can often generate, targeted marketing allows you to clearly define your unique value to your target audience in a more cost-effective way. Therefore, you can work with a leaner marketing budget and improve the Return on Investment of advertising expenses.
Enables You To Charge Premium Prices
Striving to give your customers what they crave the most may enable you to sell at higher prices than the competition. That is mainly because a business that is effectively using the targeted marketing technique, may find itself serving in a particular small market segment that is devoid of stiff competition (or none at all). This puts a business in a situation where they can make their customers feel more unique and special. The customers feel that these products and services were designed exclusively for them. Here, you can leverage this opportunity by charging them premium prices for what you offer.
Is An Adaptable Form Of Marketing
Targeted marketing offers businesses a wide variety of criteria that they can use in their marketing strategies. The customer demographics become the most commonly used factors that dictate the marketing strategies of many businesses today. A business can be able to easily focus its marketing efforts on the target audience that to them, looks almost guaranteed to want or need your product or service. For example, a furniture selling business may choose to put more focus on marketing dorm room furniture to a population of college students instead of marketing to all those who come to a furniture store. Thus, success rates here are much higher with a target group in mind as opposed to marketing “en masse” (to everyone).
In conclusion, it is impossible to appeal to all customers in the marketplace who are widely dispersed with varied needs. Marketing segmentation enables you to identify and define your target market so that you can effectively promote your product or service. Targeted marketing allows you to recognize your customers’ needs and market directly to them, without any “wasted messaging”. Your customers also see you as exactly what they want and need. Businesses that wish to succeed must identify their target customers and develop suitable and personalized marketing mixes to satisfy their needs! Good luck.