Archive for 16 August, 2011

The importance of Market Segmentation

The American Marketing Association defines market segmentation as the process of subdividing a large homogenous market into identifiable segments having similar needs, similar behaviours or demand characteristics. Then, every targeted segment will be reached with the right marketing strategy.

There is a market and a target market for practically everything. Very few companies are big enough to supply the needs of an entire market, but most of them appreciate the need to find out who will buy their products.

Not knowing who will buy a product or assuming that everybody will do, can lead to wrong decisions, wrong pricing, wrong messages, and subsequently the downfall of the business is likely.

In order to avoid failing in reaching the business objectives, market segmentation becomes absolutely necessary. Why? In simple terms, because the market is comprised of millions of people and organizations that are so different from each other. This diversity requires dividing the market so that a company can aim its efforts and marketing resources in the most profitable way.

There are mainly three criteria that are used to determine market segments:

  1. Homogeneity (common needs within a segment)
  2. Distinction (unique from other groups)
  3. Reaction (similar response to market)

The concepts to be measured within the criteria above can be: age, gender, education, marital status, lifestyle, income, family life cycle, social class, opinion, attitudes and beliefs, activities and interests.


In the case of B2B companies other concepts need to be acknowledged, such as: industries available, company stability, sales volume, location, and number of employees.

Once all this information has been compiled a description about potential customers can be written. It may be possible to locate them, or even to estimate how many of them there are where the business is looking for expansion. It is the moment to let prospective customers know that you exist.

Therefore, it is vital that companies and organizations carry out good Market Segmentation. In this way they will enjoy the benefits from showing consistency with their marketing strategy, and –more importantly– become more competitive with their target audience.

Please see the following presentation by Learn Marketing.net for basic introduction.

Share

SMARTPHONE SMART MARKETING!

There are currently 5.3 billion mobile subscribers worldwide. The mobile revolution is spreading at an unstoppable rate, and mobile marketing is a rapidly growing trend on a global level and provides many of our clients with new opportunities to connect with their customers.

In fact, half of all local searches are performed on mobile devices and consumers are twice as likely to purchase from retailers that have mobile-specific websites.

So, for businesses wanting to make the transition, we have listed 4 key points in Mobile Marketing:

  1. Browser-based Mobile Applications For many companies contemplating the development of mobile applications, often their toughest decision is the choice of platform: Android, Apple, BlackBerry, Palm or Windows. To avoid multiple platform development costs, frequently browser-based mobile applications are chosen, as they are not solely dependent on any external platform.
  2. Mobile Coupons Mobile coupons are an effective way of attracting customers’ attention: (a) at the point of sale, and (b) with a specific offer.
  1. Mobile Online Shopping Consumers use their smartphones to locate products and services from companies, and then purchase them directly. The so-called m-commerce is one of the great growth engines of Online Shopping.
  1. Near Field Communication (NFC) NFC technology allows mobile devices with this system to share data with other NFC devices nearby. This is especially useful for making payments directly from smartphones.

For a quick overview and some interesting statistics on Smartphone Users, please watch “The Mobile Movement: Understanding Smartphone Consumers”

Share

Measuring the performance of Internet Marketing actions

Internet Marketing is constantly becoming more and more complex due to the fact that there are so simply many parameters that can be measured.

Prior to commencing any Internet campaign it is absolutely vital to pause and clarify the specific Key Performance Indicators (KPIs) involved. That is, are we aiming for: (a) brand recognition, (b) increased sales, or (c) additional prospects.

As marketing & advertising experts we have to supply tangible metrics to our clients that track the results of the campaigns in real time.  Using such metrics means that the speed at which we can validate or dismiss tactics is optimum, and therefore we can deliver increased results and improve overall satisfaction for both our clients, and their audiences.

In simple terms, measuring the performance of Internet Marketing actions effectively allows us to gauge the real success of them.

Whilst there are plenty of statistics, numbers and metrics to evaluate the effectiveness of Internet Marketing actions, we are going to identify and explain the four important KPIs:

 (1) Qualified Visits: this includes QUANTITY (number of users) and QUALITY (users have performed a predetermined interaction). The quality or the user behaviour allows us to identify genuine prospects.

(2) Click-Through-Rate: this is typically the primary metric used by online advertisers. Also written as “CTR”, this is one of several indicators that clearly measure the rate of direct response to Internet Marketing actions.

(3) Engagement Score: this valuable indicator is generated from a set of integrated metrics that captures the degree of interest to all digital media content, from videos and mobile applications to landing pages and social media.

(4) Return-On-Investment: needless to say the “ROI” is the key financial indicator, and possibly the most important for business leaders. The first three KPIs detailed above generally help clarify this one.

Ultimately the questions are always: “What is the value of the Internet Marketing actions?”, and “How is the performance of them being measured?”

It is our responsibility as Digital Marketing professionals to ensure we have a strong understanding of the relevant KPIs, and know how to apply them to each specific Internet Marketing action in order to maximize results and validate our actions.

Share