STONE COLD DEAD IN THE MARKET
Whatever the Market Is, Anyway
By Bruce Marcus
Ok, everybody talks about marketing, and markets, and how to reach them — but has anyone stopped to define what a market really is?
We all tend to take for granted that when we use the term marketwe all mean the same thing. But let the conversation go further, and we quickly discover that the term means different things to different people.
And yet, there is probably no exercise more vital to successful marketing, nor so frequently overlooked, as defining a market. Without that definition, all marketing activities are either clichés or exercises in futility. For example, do companies in declining or static industries define a market in the truest sense? Is a market an abstract idea – a place or a bunch of people who buy something? Is a market a reality, or an academic abstraction?
How can you target an effective campaign at a specific market if you don’t know what it is in the first place? How can you devise a strategy to help a prospect in a market succeed without understand the prospect’s competitive position in a market? And yet, it’s done every day.
Consider the definition in terms of the answers to the following questions, and see where that leads you.
Does the segment of prospective clients you see as a market have a commonality that’s responsive to your service? For example, do they all want, essentially, the same things that you have to offer? For example, every business, and most individuals, need tax services. Does everybody who needs tax services need long range tax planning? Or tax shelters? Or defense from the IRS? The market for tax services, then, is only that segment of the population or business community that has a common need for a specific and clearly defined service.
- Is the segment of prospective clients you see as a market easily reachable and accessible with a common medium? For example, are there trade journals or other publications specifically targeted to that segment? Do they all belong to the same trade associations? If you can’t reach them easily, then they’re not a market — they’re a collection of isolated individuals. You may be able to reach them individually with your message, but only at great expense. The return on investment is substantially diminished.
- If you should succeed in penetrating a specific segment of prospective clients you see as a market what will you actually have achieved? Will they be profitable? Or will you have succeeded in winning the business of a bunch of buggy whip manufacturers? Is the return on investment worth the chase?
- What does the market know that you don’t know, but should? What are its trade practices? Its traditions? Its relationships? All these and more are essential for you to understand to serve a client effectively.
- Are you capable of serving that market if you should succeed in getting their business? The market may indeed exist, but can you effectively meet its needs? Will you have to add staff or learn new capabilities? Is it practical? And again, is the return on investment worth the chase?
There is, of course, yet another question –— and that is, does this kind of definition really matter?
Of course it does. Consider, for example, the cost of buying an ad in a publication of which only 10% of its readers can use your service. Ninety percent of your money, then, is wasted.
Consider the cost of a direct mail campaign to a market segment that can’t possibly see any value in your high-priced accounting or legal services. Or that’s so geographically dispersed that even if you sold them you couldn’t afford to service them.
There are, remember, four basic tenets of marketing:
- Know your market: In terms of its needs and your ability to meet those needs.
- Know your services: In terms of your ability to meet the needs of your market.
- Know your tools: How to use them to move your message to your market.
- Manage your tools: So that they effectively, cost effectively, and persuasively reach your market.
And how do you know your market? Basic market research is a start, using professional research services. But you can make a good start by exploring an industry on the internet, by reading trade journals, by asking cogent questions of a prospect, by attending trade shows. The more you know, the greater your competitive advantage, and the greater the chance of winning prospects in that market.
But it all starts with point one — know your market.
Bruce W. Marcus is a Connecticut-based consultant in marketing and strategic planning for professional firms, the editor of THE MARCUS LETTER ON PROFESSIONAL SERVICES MARKETING, (www.marcusletter.com), the author of PROFESSIONAL SERVICES MARKETING 3.0 (Bay Street Group, 2011 http://bit.ly/MarcusBook), and the co-author of CLIENT AT THE CORE (John Wiley & Sons, 2004) His e-mail address is firstname.lastname@example.org. © 2011 Bruce W. Marcus. All rights reserved.