Today you’re going to learn how to find a target market of potential customers so you aren’t wasting precious resources on blitz marketing. So, the two questions you have to ask yourself are:
- What do people really want to buy from me?
- What related products are they already buying?
Once you figure this out you will know who is more predisposed to purchase your products/services. Then, you find other businesses with the same customer base who you can customer share with. Come up with an incentive and great arrangement to encourage both of your customer bases to shop at both of your stores.
The basic concept is this:
You want to find existing businesses that have the customer profile that you are looking for to market your products/services to.
Then strike up a relationship with those business owners to work out an incentive for customers to purchase from both businesses.
As a result, you have an audience to market to and they generate an added value from their current base.
So, how do you figure this out? There is a great formula from Jay Abraham you can follow with great success.
LV = (P x F) x N – MC
Here’s what it all means:
- LV is the lifetime value of a customer
- P is the average profit margin from each sale
- F is the number of times a customer buys each year
- N is the number of years customers stay with you
- MC is the marketing cost per customer (total costs/number of customers)
Once you know how much you need to spend to attract a new customer, you will know how much of an incentive you can offer to a business to help attract new customers.
So, here’s your step-by-step process:
- Find companies that already have the customer base you are looking for.
- EX: A flooring contractor might want to reach out to a flooring manufacturer. All other construction services too, really. Well, one at a time, right?
- EX: A florist could talk to anyone from a mortician to a party planner.
- Negotiate an incentive for them to share that customer base with you.
- Covered above in Jay’s great example. You want to know this number no matter what you do or don’t’ do with this article information so figure it out and put it on your calendar to update annually.
- Focus your marketing resources on this group of predisposed customers.
- I cannot stress enough, even though I do all the time, that you want to focus on one group at a time, one idea at a time, one project at a time. Work it, development, detail it, delegated it, get your team used to doing it, the “new norm” and then… move on to the next shiny penny.