How to Segment Your Target Market

Market segmentation can simply be defined as the marketing strategy that involves dividing a broad market into different subset groups of consumers who have common needs as well as priorities and then designing and implementing strategies in order to target their needs and also desires through media channels and other touch points that allow easier access to them. Market segmentation is of great importance for the companies serving larger markets. Consumer segmentation similarly is the process of classifying people into groups that do have some set of similar characteristics thus resulting in the ability to be targeted and studied.

Categories of segmentation

Geographic

This involves dividing up geographic markets by using the existing boundaries, population boundaries and natural climatic zones. It enables us to segment a market that is spread over a very large geographic area into sub-markets that cover smaller geographic areas. In geographical segmentation the market is divided into different geographical units such as; regions (by country, state, nation, neighborhood), Population density (urban, suburban, rural), climate (size of an area, population size and growth rate) and climate where regions have climate patterns that are similar.

A company that is either serving a few or generally all the geographic segments, requires to put more attention on variability of geographic needs and wants. Immediately segmentation of consumer market on geographic bases is done, companies localize their marketing efforts such as production, promotion, advertising and sales efforts.

Demographic

This segmentation occurs when one or more demographic traits are employed in order to divide the market. Demographics are quantitative characteristics of a particular group of people. These characteristics include age, gender, income, education, occupation, social class, family size, generation, family life cycle, religion, home ownership, ethnic group and nationality. Most businesses that segment their market in terms of demographics area attempting to lay their target o specific segments of the market that are most likely to be interested in what they have to offer.

Demographic segmentation is the most popular form of segmentation for three reasons;

First consumer needs, wants as well usage patterns often reflect closely in demographic profiles. This means that people with different demographic traits often will have different needs and wants with respect to products. An example is where preference for music and other forms of entertainment are often tied to differences in age, occupation and also educational backgrounds.

Second, demographic data is very simple to obtain therefore there is a very huge amount of published demographic information that is available from a wide range of sources. Most of this information is available on the internet where you can easily get information such as census data by accessing the Census Bureau’s homepage.

Finally demographic segmentation is the most common employed market segment because even if we use an alternative segmentation base such as benefits or consumption rates, we will still use demographics in order to profile the segments that are being created. For this reason, most firms prefer to use demographics to simultaneously create as well as profile the market segment.

Psychographics

This segmentation divides market based on differences in lifecycles, social class or differences in personality traits. Psychographics are attributes of a market that are qualitative and refer to the way people think and also what they like to do. Psychographic variables include interests, personality, opinions, self image, values, activities and attitudes. Market segments based on lifestyle entails creating segments based on differences in how people choose to live their lives. Lifestyle is highly predictive of many behavior purchase therefore marketers attempt to characterize lifestyle patterns of consumers by asking them questions about their activities, interests as well as opinions. The items of AIO can be used to segment markets by looking for the response patterns that are common to such types of questions on surveys.

Consumption Behaviors Segmentation

This segment includes product consumption or rates of usage. Some other segmentation present in this category are product usage occasion, product user status and also loyalties tom some specific brands.

When creating market segments that are based on use of product occasion, emphasis is put on identifying different occasions or circumstances under which the product is used. This product may be used on by different people on different occasions or circumstances. Example most airlines have segmented markets into occasion segments that comprise of people flying for purposes of business i.e. business flyers, vacation flyers and those people flying for family reasons. Each and every segment represents a different usage occasion and is each segment is targeted with a different strategy for pricing and promotion.

Marketers who employ product user status segmentation attempt to identify differences between non-users, regular users, potential users, ex-users and also first time users of the product. Most of the large firms in the market do target non-users or potential users in an attempt to stimulate the product’s primary demand. The smaller firms on the other hand target regular users in an attempt to encourage switching of the brand. Most marketers put an effort in trying to differentiate between users and non-users of product categories when the characteristics of a consumer are tie d to the need of the product itself instead of use of different brands.

Firms can learn and gain a lot by analyzing customer loyalty patterns in the market. They can do this by finding the characteristics of those customers who are loyal and non loyal for their brand and those of their major competitors then find ways to keep their customers loyal and attract the non loyal ones from their competitors. Brand loyalty is defined based on the consumer’s pattern of how repeatedly the customer makes a purchase.

Consumer Predispositions segmentation

This entails creating segments based on the differences in the needs, wants and attitudes of the consumers. Markets can be segmented based on the level of peoples’ knowledge on a particular product category. This can be done by having in place different programs for promoting the products in order to communicate with those consumers who know little about the product and those who don’t know about the product.

Segmenting the market based on media viewing habits of consumers, may reveal consistent differences in what type of media the consumers prefer may it be television shows, magazines, radio stations and newspapers and how these differences vary with the demographic and psychographic traits of the customer. Such information can be used to target advertising as well as other communication to groups of customers.

Conclusion

The more the segments marketers are able to identify and also combine to target individual groups that are most interested in what they have to offer, the more effective their marketing efforts can be. Businesses puts much effort to learning as much as they can about their customers including where they live, their income levels, age, what they like purchasing and what they like and dislike. Using this information can be used to reach non customers

The Top 5 Referral Marketing Ideas for New Businesses

Do you have a brilliant business idea that’s taking off? Are you at a point where you have a product and your customers love everything about it? Have you considered leveraging the power of referral marketing to help even more people discover your product? There are numerous referral marketing ideas that can help you increase your sales.

Consider this – nowadays, a business has to sell more than just a product. You have to sell a full customer experience; An experience that has inspired your customer to share your products with friends and family.

Marketing conditions are continually changing. Unlike a decade ago, businesses these days do not only sell a product or service to customers, but also an experience. They are given a full experience that will inspire them to share the product or service with friends and family – all of whom are potential customers. Word-of-mouth referrals are the most effective way to grow your business, and this is especially true when you are just getting started as a business.

According to Entrepreneur, an ever increasing number of businesses in 2015 and beyond will try to be more open to feedback from their customers. Here are a few referral marketing ideas on how you can make the most out of your customer referrals.

1. IMPROVE YOUR REFERRAL MARKETING STRATEGY

A Nielsen Trust Study from 2013 showed that referrals are the most trusted form of advertising. This information should be good motivation to establish a solid referral strategy, one based on various referral marketing ideas.

Research is the foundation of any marketing strategy. When you want to craft a good referral marketing strategy, the initial research should include the basics, such as understanding customer desires and needs. But we also advise you to conduct research on any potential referral channels, such as news publications, influencers (bloggers and social media influencers), as well as finding all possibilities to produce customer reviews and opinions online.

Once your research is done, use the data to find the right referral marketing ideas, and then craft a successful strategy which includes:

– Exceptional customer service. Give customers or potential buyers a reason to engage, care about and tell others about your brand. Satisfied clients provide great referrals that are invaluable to small businesses

– The 80/20 rule of referral marketing

– Shareable product experiences. A simple Facebook post, Twitter tweet or Instagram selfie can now reach hundreds, if not thousands of potential customers in a few seconds.

– Referral marketing program. Consider including an obvious incentive in your referral marketing program. Customers are more likely to refer friends and family when there is a valuable incentive involved. If the incentives are worthless or undesirable to the company’s existing customer base, the customers won’t be interested enough to participate in the referral program. Make the program more visible by placing signs in stores and using any internet marketing tools that apply.

Influencer. Find a person who is sufficiently influential in your niche. It doesn’t have to be a celebrity; A popular blogger, YouTuber or Instagramer will do the job.

References. Use references as referrals because people consider other people’s opinions before determining whether they should purchase a product or not.

2. FOCUS ON ONLINE REFERRALS

Referral marketing can be highly effective in an online environment due to the popularity of social media and sharing sites. Internet referral marketing can potentially spread information faster and to a wider audience than most offline marketing strategies.

These days, average customer reach is much larger than ever before and for many people with strong social followings, it can be enormous. Customers now have the power to make or break a business by what they say about it online.

According to research carried out by social media experts, 78% of consumers trust peer recommendations, whereas only 14% trust advertisements. Perhaps that’s why online communities are so good at generating business referrals.

Dropbox, an online file storage company, implemented a very successful referral program in 2009 asking users to tell their friends about the service. The program offered rewards for both sides in the form of additional free space.

This program came to be very fruitful. Namely, by 2010, 35% of daily sign-ups were the result of a referral, while signups had permanently increased by 60% overall. The company estimated that within a 30-day period (April 2010), their users had sent more than 2.8 million direct referral invitations.

Dropbox debuted as a Y Combinator startup in 2007. It now has 300 million users and more than 500 employees. Follow the trend and take advantage of the variety of social media approaches to increasing your referrals. Brainstorm on various referral marketing ideas and try them out.

3. USE CONTENT AS A REFERRAL TOOL TO FORGE STRONG REFERRAL RELATIONSHIPS

Most often, customers are too busy to leave referrals, even though they are satisfied with the product or service. In situations like this, valuable content can generate referral introductions in ways that are constructive and valuable as opposed to shallow and fruitless.

Valuable content is an effective tool for attracting strategic partnerships as well. While many business owners focus most of their referral efforts on customers, non-competing businesses that serve your target market can be one of the most potent sources of referrals.

4. CONNECT WITH RELATED PRODUCTS AND SERVICES

The old premise “It’s not what you know but who you know” is still very popular in the business world. Even though you may be skilled and dedicated to your new business, your chances of success will rise exponentially when you connect with the right people.

Many companies collaborate with complementary businesses and cross-promote to each other’s customer bases. In order to promote your business, identify a connection that would be interested in setting up a barter program with you, one in which you’ll work for them and refer new clients to their business and vice versa.

Networking is the key to obtaining more customers and earning brand trust. For this reason, view every moment as a potential networking opportunity and watch your business grow.

5. SEEK CREATIVITY IN REFERRAL MARKETING IDEAS

Having a variety of electronic devices available to you and your customers, you have infinite possibilities of creating inspirational referral marketing ideas. If your client is willing, try to capture a testimonial on video. This can be a really powerful asset. Offer them an incentive to motivate them to make a creative referral.

Another idea you can try is thinking of a witty way to ask for referrals. There is an interesting example of a computer repair company using stamps reading “We Crave Referrals” on every paper that customers receive – including newsletters, marketing material, and invoices.

Remember, the best referrals are the ones you don’t even have to ask for. Thus, provide your customers with an exceptional experience that will make them eager to share it with others. Try various referral marketing ideas and see how they work for your business.

What’s Up With This Hype About Network Marketing Anyway!?

MLM, Split Second Marketing, Affiliate Marketing, Online Marketing, it’s all the same – just Network Marketing. More and more people are becoming interested in Multilevel Marketing “Make Life Meaningful”, MLM in short. Even though Network Marketing has existed since the beginning of time, most people are still unsure of what it actually is and how it works. There have also been many rotten apples that have tainted MLM’s existence with negative outlook and gave Network Marketing a bad name. As people tend to remember negative experiences rather than positive. You may have gone to the same restaurant 100 times, but if the food or service was awful once… what did you do? Probably remembered ‘that’ particular instance over the hundred great times that you’ve been there. With schools all over the world from Harvard to Oxford teaching Multilevel Marketing/Network Marketing; it’s a no brainer that MLM is one of the best ways to build residual income.

Studies by the Direct Selling Association (DSA) indicate that:

  • Direct selling accounts for annual sales of more than $190 billion world-wide.
  • The US contributes nearly $53 billion.
  • 19 million Americans derive independent contractor income from direct selling.
  • One in every 10 households has someone involved in network marketing or direct sales.

What is Multilevel Marketing and how does it work? MLM works because people prefer to use products listed by a friend or an acquaintance. It works because the products offered are good and cost fair value. It works because people feel satisfied with the product and indicate to acquaintances who are satisfied with the product and so forth on a scale of exponential growth.

Anyone can be a network marketer, but usually dedicated individuals and entrepreneurs that know they can make money with alternative income, also known as residual income tend to be involved in MLM. We normally sign up for an MLM company that consists of working to promote the products and the opportunity offered. With the main advantage of being able to start without initial investment that a normal business would accommodate. Taking into an account of high cost needed to start any company.

If I lost everything and had to start again, I would find myself a great network marketing company and get to work!” – Donald Trump

Who should avoid MLM?

Disbelievers in MLM. Anyone thinking about earning money easily without having to work.

What are advantages of MLM?

Possibility of unlimited gains. Without an expensive initial investment. Ability to work on your own time.

What are the disadvantages of MLM?

Moderate level of rejection by those who do not know. Not only by them, but mainly by those who “think they know.” This rejection is created by millions of people who promise unlimited earnings without any work. People who use MLM companies with particular forms of pyramids just to get more people registered without worrying about the quality of products or showing guidance when sponsoring. All this nonsense turns people off from serious chances of success.

Network Marketing

The Evolution of Network Marketing… Marketing in general context, is the junction of Relationship Marketing. It focuses on the quality of customer relations and direct marketing, which happens to be the direct relationship between vendor and customer. Therefore, Network Marketing allows the direct relationship of the distributor (seller) with the client to maintain a quality of relationship between them, since this system only devotes itself to the permanence of a direct relationship in the long run. Network Marketing is a distribution system or a form of marketing that’s moving legitimate goods and services with high market value, from the manufacturer to the consumer through a network of independent contractors. It’s a way to organize and pay for resellers involved in direct sales. It has a compensation plan for direct sales in which resellers can receive earnings with the following common two ways. First, marketers may receive compensation for their personal resale of products and services to consumers. Second, marketers may be paid for their purchases or resales of people recruited and sponsored. Individuals may also be paid from the resale of the group or network that recruited and sponsored them previously. At the end, it is an opportunity for marketers to set up their own business by reselling goods and services and developing and training an organization or a network of resellers they sponsor to do the same. A multilevel distribution company means any person, firm, corporation, or other business entity that sells or distributes goods or services through independent marketers, reps, agents, contractors, distributors, and varied participants may recruit other participants. Commissions, bonuses, refunds, discounts, dividends, and other considerations of the program are or should be paid as a result of the sale of a service, product, recruitment, performance shares, or additional participants.

I would rather earn 1% of 100 people’s efforts than 100% of my own efforts” – John Paul Getty (American Billionaire)

How can you succeed?

Short answer:

Work diligently, work consistently, and don’t give up.

Long answer:

All companies are different, and what works in one company might not work in another. You should learn from your upline – ask them what works and what you should do to succeed. Draw on them for help. They’ve found out from experience what works and what doesn’t and they’re interested in your success. The fundamental ideas, though, are the same in any company. Do what a distributor/associate/whatever is supposed to do in your company – retail products, sell services, consume products, whatever… and find others to do the same. Teach them to do what you do. *Duplication* is the key to success. Wherever there is a McDonalds – there is a Burger King. You’re not supposed to go out and enroll the world, or sell something to everybody on the planet. You’re supposed to find a few people who want to build a business, and help them do it. More importantly, teach them to do what a distributor does and go out and find a few people to work with and teach those new people. Until you have “taught your people to teach their people to teach,” you have not really duplicated yourself. Keep plugging away. Unless you’re incredibly good at this, it will take time to build a group. It takes time to find good people and teach them what they need to know. Sometimes your best people will give up and drop out. Sometimes it can be very discouraging. Sometimes you may be tempted to give up. If your company isn’t working very well, maybe you should. But if the company’s working well, and others are succeeding, you need to take a look at what you’re doing that isn’t working. It may be that you wouldn’t do any better in another company, even if the grass looks greener, because you’re doing the wrong things.

It is a sad fact that a very small percentage of people who enroll in any particular MLM will succeed big. This is not, however, a fatal flaw of MLM; it’s a reflection of real life. 90%+ of small businesses fail within 1-5 years… and the owners lose a whole lot more than the few hundred dollars an MLM person typically invests. 98%+ of corporate employees will never achieve executive levels. 95% of 65-year-old retirees in the US (according to Insurance & Social Security statistics) are dead or broke.

The sad fact is, very few people succeed big in any endeavor. Most people simply will not do what it takes to succeed. MLM is no different in this regard. However, many people get into an MLM with the idea that it’s some kind of “easy road to riches”. It’s not. It takes work. It takes time and dedication. But most people don’t see that, either because their sponsor misled them with rosy predictions of instant wealth, or because they chose to hear the easy story. People like this enroll and don’t do anything, or give it a try but give up after a few months. This is where the vast majority of “MLM failures” comes from.

The biggest problem with MLM is that it’s “too easy” to get into (usually no more than a few hundred dollars), so it’s “too easy” to get out. With only a few hundred bucks committed, it’s easy for someone to say “Ah, heck, I talked to 5 people and none of them were interested. This doesn’t work! Guess I wasted $200.” You should approach your business as if it was a “real” business, one that you had invested your life savings into. If you had sunk $200,000 into your MLM business, would you let 5 “no”s stop you? Hell no!! You’d get back out there and keep working until you made it work, because you had too damn much money in it to give up! Well, guess what? That’s what makes MLM work too – that dedication to keep working until you make it work. If you work consistently, and effectively and build your group faster than the faint-hearted people drop out, your group will slowly but steadily build. And if you’ve taught your people the correct ideas of “work consistently, work effectively, and teach your people how to duplicate your efforts”, you should see a consistent rate of growth. It will probably take longer than you’d like (hey, that’s the way life works), but as long as you keep working at it, your income will eventually build to the level you want.

The problem is, most people don’t do this. Most people who get into MLM give it a half-hearted try, then give up the first time they get a “no” and complain that “It doesn’t work.” Only the people who determine to put in the effort, and actually DO what it takes to succeed, will stick it out and end up on top.

Some questions to ask yourself before entering MLM/Network Marketing Opportunity

Is there a legitimate product involved?

What do you get in return for your start up investment, other than the potential to earn good money? If you’re not getting a product or service or if the training tools appear to be overpriced you could have discovered a scam.

Do you get commissions based on product distribution or on recruitment? If they are paying commissions based purely on recruitment, walk away now.

Consider the following factors that might influence long term success. Does the company have a proven track record?

If the company has been around for a few years then there is a fair chance that governing bodies that police pyramid schemes have already pulled the business model apart and given them the OK.

Is this a get rich quick scheme?

Although there is a lot of potential to earn very good money in network marketing very few have made it quick, most make their millions through consistent effort.

Shop around

If you are looking into the industry for the first time don’t be scared to look at other business models and products, particularly if you don’t know which company to join.

What training do they provide?

A good company has a solid training system.

Say hello to MLM and Network Marketing

Thoughts become things. With self development, business, and entrepreneurial mindset and dedication we must teach people to do their due diligence while progressively enhancing their outlook on Multilevel Marketing and Network Marketing because it is a proven system that has created wealth around the world for people like you and me. Anyone can be a network marketer, but usually committed people that know they can make money with alternative income, also known as residual income tend to be involved in MLM.