Here are two things you can do, that do cost money, to give yourself the most chance of hitting your sales targets:
- Undertake market research
Create an Ideal Customer Persona (ICP)
- Undertaking market research is about identifying the segments in the market so you can target them effectively. Creating an ICP will give you a deep understanding so you can design your marketing, sales and product to fit the needs to the most profitable segment.
A great example is CVS Pharmacy, one of the most successful chains in the USA. Through research they found that 80% of their customers were women so they redesigned 20% of the stores offering shorter wait time for prescriptions and wider shopping aisles.
Business-to-business (B2B) products tend to be more complex than business-to-consumer. The B2B segments have key characteristics:
- More complex decision making units
- More rational decisions
- Personal relationships are more important
- Longer term buyers
- Innovation requirement
- Fewer behavioural needs
A typical B2B market can be segmented into four
- Price sensitive
- Quality and brand
- Service focused
- Partnership bias
When you look at your market you will know if your segmentation will work by asking four questions:
- Are the segments truly different?
- Are the segments big enough?
- Do companies clearly fall into one of the categories?
- Can each company be easily identified as belonging to a specific segment?
When you have your segments you can score each 1-5 on segment attractiveness and competitive advantage to give you the best one to focus on.
Next we will look and the insights by developing an ICP.
Image from Flickr by Greg.