Where the New Consumers Are
How to cost-effectively expand your customer base.
How to cost-effectively expand your customer base.
If you’re like many of my clients, you’re always looking for ways to increase your base of profitable customers in a highly competitive, maturing market. Often, the client is neither the market leader nor the market follower. Frequently, its site isn’t optimized to rank in the top five listings on the major search engines, and it’s priced out of many prime paid keyword positions. From a brand recognition perspective, this translates to the fact the client’s not on its target consumer’s radar. Given these constraints, how can a marketer increase traffic and sales with a limited budget?
I’ve worked with clients who’ve spent big bucks to go after mainstream market share in an established vertical with less than optimal results. Meanwhile, their richer, market-leader competitors have invested millions in growing online market share supported by major offline media buys. How do you cost-effectively respond to these perils?
Approach your market from a different perspective. Look to individually cultivate those niches related to your product or market.
In contrast, there are companies that understand market share can be built by dominating a number of related segments. One client grew very profitable niche segments for a mature product offering. As a result, it was able to a cross-sell bestselling, mainstream product to its involved customers with almost no incremental marketing cost. It leveraged existing buzz and popularity to sell a piggybacked product in customer communications that were already being sent.
With a limited budget, you, too, can be a big fish in a small pond while operating under your larger competitors’ radar. You may think building a targeted niche user base is expensive. There are two different, cost-effective ways to approach this problem. You can tune your product line by either selling other, related products into a specific market segment or sell the same product into different market segments. Consider the following steps to determine which niche segments or offerings will work best for your company:
As part of this analysis, more broadly compare customer characteristics across your different offerings or divisions. Though this may not work for newer companies with limited product lines, larger corporations may be able to work with colleagues to find synergies by leveraging their customer relationships by cross-promoting products.
Once you’ve determined the optimal niches for your business, think about niche-targeting your marketing spend:
When following a niche strategy, one major business decision you face is whether to approach niche marketing as part of a greater whole, like a house with multiple entrances, or as separately branded sites with similar back ends. When approaching new niche markets, consider whether there are ways to leverage your existing infrastructure while customizing the marketing. This helps you gain economies of scale while focusing marketing on making niche customers feel you really know how to meet their needs.