Marketing can be a big scary beast, especially if you haven’t had much success with it before. You will have to spend time and invest money to get it right. But before you commit to anything, it’s best to do your research first to put yourself on the best footing possible. What is often missed as the first step of any marketing is working out who you should target and what you want to get out of it, but this can be easily fixed by creating some target personas and proper goal setting. Jeremy Thomson, the founder of Common Collective, takes us through how to define your audience and setting marketing goals.
This is the first in a series of articles by Jeremy Thompson of Common Collective looking at how best to run the most effective marketing campaign for your business.
Who are your customers?
A good place to start is looking at the current makeup of your client base. Think about where they came from in order to understand if you can you replicate it. We want to look at the clients that are most profitable to your business in order to keep going after more of these, typically return customers and those that buy in volume.
Can you make a list to identify them easily?
There are a number of identifiers you can pick out that your customers have which can help you define them. The list below, whilst not exhaustive, is a great start to defining your audience:
- Demographics: The gender and age of your customers
- Product: Which product(s) of yours did they purchase? Does this suggest an
indication of palate or interest?
- Customer origin: Where did they initially come from, or hear of you?
- Why did they buy from you? Think about how they became a customer in the first place – was there a reason they chose to buy from you?
- Why do they stay? If you have return customers, can you identify why they buy regularly – can you pinpoint anything beyond your product?
- Interest: What else are your customers interested in? It is ok to guess here
This should give you a nice overview of your customers. You may have found that there were a few options of each – make sure you keep them separate as you can now build out multiple personas. Don’t lump them all together and make everything generic – that will make the exercise redundant.
Translating clients into your target audience
Now you have your current clients mapped out you have a base target audience. Do the exercise again, this time thinking of your ‘ideal client’. Ideal could mean more profitable, more orders or something else to your business.
How closely do the personas of your ideal customer and existing customer match? If you think about your marketing, you can aim it towards certain audiences, but the more targeted you can be – the greater success you will have. When you look at any marketing you have planned start thinking about how this could apply to your target audience – are there any changes you could make or channels you haven’t considered yet?
This is the first step to creating your marketing strategy – you now have some outline ides of who your audience is, so what next? This target audience will dictate how you market to them, the kind of channels that would be right to attract these customers, and the tactics you can use.
Now you have your target personas, the typical next step would be to choose your channels – the ways in which you can market to them. Whilst you are now in a better position to do this, there is still one thing to do first – goal setting.
I am a huge believer in goal setting – both for marketing and in a much wider context – if you set goals, you are much more likely to hit goals, it really isn’t rocket science.
One of the tried and tested ways to do this is to set SMART goals: Specific, Measurable, Attainable, Realistic and Time Specific. This classic goal-setting method still holds weight and is worth taking into account at this stage, but don’t place too much importance on it. Without a strong marketing background, you might not be able to get too specific or build too many of them.
It is at this stage people can get frustrated that they can’t do it, throw down their pens and make a cup of tea. For today – just make one, overarching, SMART goal and then you can work back from there for everything else.
Your first goal
This is whatever is most important to you – most often sales or revenue.
Think about what you would like to see in terms of revenue from your marketing. Not only will it help you set budgets but it can make your output tangible. This is a classic mistake by businesses – to not set proper goals. We hear it all the time ‘oh, any extra sales would be great’ or ‘we just want some more revenue’ – without putting a number on it, you won’t know if you are successful or not.
Let’s look at revenue growth as an example, over the next 12 months:
Creating a revenue based goal
Look at, dig up or vaguely guess at your revenues for the last 12 months. That is your base number. Theoretically, if you did everything you did in the last 12 months again you would be able to hit that number.
Now, what do you want that revenue number to look like in 12 months? Remember to stay realistic – the amount of product or what is realistic in terms of capacity is important here. You don’t want to put a figure that is unattainable – you will end up much unhappier when you don’t hit it!
Now with this new number – what extra outlay is required to hit that? Start internally with the things you can control, such as increased production costs or logistics, for example, and now we can start looking at the end gross profit, although still quite rough figures at this stage. It is out of this number that you will need to set your marketing budget.
The next thing to consider is your average order value – what does a typical customer spend with you on a transaction. Take that revenue growth and divide it by your average order value and you have an idea of the number of additional transactions you will need to bring in to hit your revenue targets.
The aim of this is to get you to a point that you can understand what you want out of your marketing – I want to grow by £x over the next 12 months, which will involve roughly xx number of new customers or transactions.
- Last 12 months revenue: £100,000
- Next 12 month revenues: £150,000
- Extra Costs: £10,000
- Average Order Value: £1,000
- New transactions required: 50
Now – what is the value of hitting these new figures and what is it worth? What percentage of this figure would you put towards it in order to hit your goals – 10%, 20%, 30%? Your margin is important here – if this figure is more than your net profit on this – it won’t work for you.
The value of good goal setting
Visibility -> by creating your goals in this way you know what you want to hit and are able to keep track of your efforts and understand how well everything is performing. Marketing can get confusing – it is incredibly data heavy – but having something to refer back to, that relates to your business and finances gives you a KPI and benchmark or performance. It removes a level of mystification and allows you to focus on what’s important.
You are now armed with your overall goal and the steps it will take to get there, in terms of transactions. You know the people or personas that you want to target in order to hit those numbers – not only are you now ahead of most businesses, but you can start constructing your marketing strategy. This involves selecting channels, setting detailed budgets and goals and finding the right providers for success.
Jeremy Thomson is the founder of Common Collective, a marketing company working with ambitious businesses that are concerned they don’t have a decent marketing strategy, know they should do some marketing but aren’t sure where to start.. You can reach him at firstname.lastname@example.org .