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Profiling Your Target Customer

Profiling Your Target Customer. 4. chapter. Prepared by Ron Knowles Algonquin College & Jennifer Rouse Barbeau Canadore College. Explore Customer Groups. Chapter 4 will: Help you begin collecting information to understand, develop a profile of, and connect with your target customer.

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Profiling Your Target Customer

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  1. Profiling Your Target Customer 4 chapter Prepared by Ron Knowles Algonquin College & Jennifer Rouse Barbeau Canadore College Explore Customer Groups

  2. Chapter 4 will: • Help you begin collecting information to understand, develop a profile of, and connect with your target customer. • Begin toformulateyour market strategy. Chapter Overview 4 chapter

  3. Learning Opportunities • Understand that your key to survival in small business is the target customer. • Recognize three kinds of customer groups. • Use primary and secondary research to profile your target customer. • Match your target customer with what he or she reads, watches, and listens to. 4 chapter

  4. Learning Opportunities • Become more aware of and start being on the look-out for potential partnerships, alliances, and associations. • Recognize the market and the target customers who are about to surface. • Research your prospective target customers and refine your mission statement. • Visualize your business and target customer. 4 chapter

  5. What is Customer Relationship Marketing? A Key Trend: Customer Relationship Marketing • The development of long-term, mutually beneficial and cost-effective relationships with your customer. • Emphasizes a market pull strategy: • Determine what your target customer (TC) wants. • Profile your target customer. • Adapt or create a product or service to satisfy this want or need. • Emphasizes a one-to-one marketing strategy.

  6. The Power of Profiling Three types of customers: 1. Primary: The primary or target customer is most likely to buy your product or service and could be a heavy user. • Secondary: The secondary customer has a possibility of buying your product or service but needs convincing. 3. Invisible: The invisible customer is the one you don’t anticipate but has a need for your product or service. This customer appears after you open the doors.

  7. Two Types of Customer Profiles • Business to Consumer (B2C) or End-User Profile • If your TC is the consumer or end-user, your customer profile will likely require demographics or psychographics. 2. Business-to-Business (B2B) Profile • Many small businesses offer their services or products, often on a contract basis, to other businesses. • These supply chain companies need a customer profile that is based on business or company-type information.

  8. Demographics & Psychographics DEMOGRAPHICS Key personal characteristics of a group of people. These include: • Age • Sex • Family Status • Age of Children • Education • Residence PSYCHOGRAPHICS Process of segmenting the population by lifestyles & values. These may include: • Where they eat & shop • Sporting activities • Entertainment activities • How socially & physically active they are • Whether they travel for business or fun

  9. Psychographic Profiling Chances are you will have to do your own psychographic research. Use Action Step 24 to get started: • What is your VALS? Click on the SRI Consulting Business Intelligence site. • Profile your target customer using postal codes. Link on to Generation 5. • Do your own psychographic profiling. Invite a few friends to a psychographic party.

  10. Media Sources Can Help Demographic & psychographic profiles are available from media sources: • Magazines • TV and radio stations • Online

  11. Media Sources Can Help • Analyze media sources aimed at different target markets. • What does your target customer read, listen to or watch? • Action Step 25 will help you get started. • Conduct primary and “new eyes” research. • Interview magazine buyers. • Do some secondary research. • Write to advertising departments. • Ask for media kits and reader profiles.

  12. B2B:Business to Business Business-to-business or supply chain firms can be characterized as: • Businesses whose target customers are other businesses. • Businesses who do not deal directly with the end-user or consumer. • Businesses whose major goal is to create partnerships, ventures, alliances, or associations with their target customers. A target customer profile would include: Company Profile: e.g. size of business, type of business End user Profile: e.g. end-user application, decision-maker Industry Profile: e.g. trends, competing firms and barriers to entry.

  13. Joint Ventures & Strategic Alliances:10 Tips • Have a common purpose • Conduct research • Consider mutual benefits • Provide a structure • Consider potential advantages • Invest in human resources • Put it in writing • Stay in touch • Keep tabs • Exit stage left

  14. B2B or B2C B2B or B2C? Which one will it “B”? • Recall the experience of Adrienne Armstrong at Arbour Environmental. You can benefit from both worlds.

  15. Field Interviewing & Surveying FIELD INTERVIEWING TARGET CUSTOMERS SURVEYING Test your TC profile, developed from secondary research, against reality. Ask questions of your potential customers. Recall the experience of Julia Gonzales. Develop a questionnaire & identify a survey location. Get permission from the location owner. Bargaining tactic: share the information you discover. Recall the experience of Elizabeth Wood.

  16. Other Sources of Primary Research Mentoring: Locate a business owner who wants to help. Experience: Work in a similar business and get all the information you can. Networking: Go out and talk to local businesses and friends. Brainstorming: Gather a group of friends, associates, or family and brainstorm your TC. Competitors: In some cases, researching your competition may provide some good information about your potential TC.

  17. Business Vision Visualize your new business and the target customer. A business vision is: • A mental picture of your business, product or service at some time in the future. • A source of guidance and direction. • A driving force for your persistence and passion.

  18. Chapter 4 helps you prepare Part B of your business plan: The Market & The Target Customer Business Plan Building Block

  19. Checklist for Your Business Plan • Profile your target market in terms of primary, secondary, and invisible customers. • What do the results of your primary research questionnaire tell you about your target market? • What information have you developed about your target customer from your secondary research? • What characteristics are unique or clearly definable about your target customer? • What is the best way to reach your target market?

  20. My Virtual Model Case Study My Virtual Model (MVM) is a successful company headed up by Louise Guay and Jean-Francois St-Arnaud. Answer the Chapter 4 case study questions to learn: • How MVM takes advantage of relationship marketing, the market pull approach and one-to-one marketing. • The three types of MVM customers. • MVM’s and Lands’ End target customer profile. • What MVM’s business vision was and how Louise Guayused primary research to help start the business. • How MVM benefits from market trends and partnerships.

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