A growing consumer products company has several successful products that are all the rage with homemakers who love to craft. These products potentially have other uses or customers but the housewives really love them and, as a result, become the fuel for this company's growth. All marketing efforts were devoted to this group, all consumers were considered similar, and all messaging was uniform. And the company continued to grow....in spite of this. Eventually demand leveled out and the company ceased to grow.
Is there a lesson here?
Rule #1 in marketing is "know thy customer". And if you have a halfway decent product or service that word customer likely has an "S" at the end of it. So let's make that "know thy customers." You likely have multiple customers and those multiple customers likely have unique tastes, buying habits, and preferences.
You know where this is leading....Market Segmentation. Since everyone has different reasons for using your products it is essential that you find an economical way to connect to those unique groups. In marketing parlance this is segmenting the market and there are several ways to do this ranging from simply interviewing several of your key customers to applying robust statistical analysis like CHAID to a large survey population. It is only common sense that, if your customers are different, that you adjust accordingly.
Some of the positive results of market segmentation include:
- More accurate sales forecasting which means improved resource planning.
- Increased revenue by focusing marketing efforts on the high demand customers.
- You better understand your markets and they will appreciate your willingness to get to know them.
- Cost savings when instead of marketing to the entire customer base you match messaging with the groups that will be the most likely to receive them.
Go forth. Continue to sell your products. But do so smartly. Don't treat a Sally like a Fred. They may both buy your products but they are very different. It is your job to know those differences and provide incentives to ensure their loyal and profitable patronage.