Defining a Target Market

Customer Targeted Marketing

Necessity of Change from Traditional to Customer Targeted Approach to Marketing

Rationale for Need to Change to Customer Targeted marketing

Change from a traditional marketing approach to customer targeted marketing

In every business in the modern day, change has become dominant. And one of the most sought after management skills is the ability to adapt and master and reap benefits from the changes. This fact is particularly true in the case of marketing where changes are happening fast and thick.

The dilemma for today's business leaders is to adjust between adapting to change the costs of changing along with estimating the potential benefits from the change. And even while changing strategy, the marketing efforts of accompanying need to reflect an internal constancy for the purpose of the change and an external consistency of the image of the company (Kashani & Jeannet, 2005).

It is here that there is a rising debate about which marketing strategy is best -- clinging on to the established traditional marketing strategies or to adopt a change and focus on targeted consumer marketing.

Traditional Marketing

The 4ps - Product, Promotion, Price, and Place make up the backbone or are the four cornerstone traditional marketing strategies. The focus of traditional marketing is on the identification of the correct audience segment, getting and understanding of the behavior of the audience and providing effective incentives for such audience to make a purchase of the product that is being marketed (Scott, 2007). In between one also has to consider the best available and cost effective channel or the medium through which the marketing message from the company would reach the customer.

Traditionally marketing was restricted to and often limited by the number of media available for broadcasting the marketing messages to the intended audience. The aim for traditional marketing efforts is to choose the best possible media and deliver the marketing message as many times as possible through the media. The aim is to try and convince as many people among the audience as possible into buying the product or service being marketed. However, with the advent of the information age and the proliferation of the internet and smartphones and social media platforms, there are numerous options and permutations and combinations available to the marketers. This is why in the most recent times experts tend to add another P to the four Ps of traditional marketing -- people, to the mix (Safko, 2013).

Advocates of traditional marketing still believe that it is most important to understand, know and identify the target audience. Often marketing techniques revolve around the segmentation and the identification of the target audience on the basis of age, place, preference etc. the segments could be created out of a number of components like audience composition, geographical location, buying behavior and events.

It is important to have the current and a very precise overview of the target audience to enable one to create an impression of the target audience and hence one would be able to tailor make relevant messages and content for them. This would also have to take into consideration the media preference of the audience throughout the entire lifecycle of the message and the product or service.

Since in traditional marketing, the effort, and the messages are sent from the organization to the customer with some knowledge about what the customer would want and how they want it, such type of traditional marketing is often referred to as push marketing.

While promotions and offers still remain important tin the content of marketing messages and the marketing mix, the new mantra is content that engages the targeted audience. Often customers value important and valuable information to coupons and price discounts.

Customer Targeted Marketing

This is the form of marketing that is being employed in recent times where the elements like the product, the place or the promotional methods take second fiddle and the customer becomes the most important aspect of marketing communications. This form is also known as targeted marketing where a company identifies a specific group of customers that they want to target for the sale of its products or services. Unlike in traditional marketing where the product the place for marketing, the price offers, and the promotional content were considered to have equal value, in customer centric or targeted marketing strategies, everything else revolves around the customer (Scott, 2007).

The company or the marketing team of a company first selects a particular group of customers. This is targeting of customers where customers are clustered based on some common ground. That common ground or qualities can be age, sex, economic ability, geographic location or even a small locality. This is done to ensure that the marketing messages are very pinpointed and are aimed specifically to cater to the likes and interests, wants and desires of a particular set of customers. Thus, the message is special and is not intended for everyone but a niche group of people (Neapolitan & Jiang, 2007).

However, customers are targeted with the assumption that they would be the ones that would most likely buy the products or services being marketed. At this stage, while transforming from a traditional marketing would or strategy to a customer targeted one, the marketing team needs to resist the temptation of trying to appeal to a greater audience in the hope that hope of reaching out to a larger audience or a larger slice of the potential market. It is the same as firing one bullet ion a specific target rather than firing ten bullets in random directions and hoping that one or more would hit a target (Esteves & Resende, 2016).

While market surveys and reports were always prevalent, what has caught the fancy of modern marketing experts is market intelligence. This is similar to a market survey but goes into much more details and enlists the exact demands, wants, desires and aspirations of a particular customer segment. It also identifies other aspects of the best media that such targeted customers can be reached and even the time and the place where they can be reached. For example, while targeting the youth in the age group of 18 to 30, marketing experts and professionals can be sure that this customer group would be available on the social media and a vast majority of them would be active on social media. Hence, the marketing efforts and the marketing message contents should be designed that fits and suits distribution on the social media and the internet.

Therefore, customer targeted marketing efforts are best suited for the modern day customer (Ko, Lee & Whang, 2013).

In the world of customer-centric marketing, a new concept has taken center stage. While generational marketing that defines consumers by social, economic, demographic and psychological factors and not just by age, is being used by marketers since the 1980s in order to present a more accurate painting of the target consumer, cohort marketing is now becoming popular among marketing professionals. This form of marketing groups people who went through the same form or type of experiences in their formative years. Thus, people in particular cohort tend to bond together or have common likings and dislikes and would tend to behave differently from people belonging to other cohorts even of the age, sex or the economic backgrounds are the same. There would, for example, be a distinct difference in behavior among people who grew up in the 1990s compared to the people who grew adults in the new millennium even though they would not be too much separated by age (Pentina & Neeley, 2007). To narrow down the target further and get a narrower reading, some marketing professionals even tend to combine cohort with generational marketing and with life stages - what people were doing at a certain age in their time in life such as getting married or having children or even retiring. Physiographic, or physical conditions related to age are sometimes correlated to the above-mentioned elements to get a clearer picture of the targeted audience (Haytko, 2001).

The rise of the social media platforms has also made customer targeted marketing a necessity. The social media is very interactive where member and users can share and exchange information. While it is an opportunity for companies to directly approach the targeted customer, it is also a place where a wrong message can tarnish the company image. Hence, content has assumed importance in this sphere. Social media, when used for targeted marketing purposes, should have very specific messages and message content. Such messages essentially need to be engaging and arise curiosity of the viewer of social media user in a manner that the users get engaged and either forwards or shares it or comments on the post. Marketing people can get a sense of the pulse of a particular group of potential customers from these activities (Zimmerman & Ng, 2013).

The social media is also a place where customers can directly get involved or engaged with a company or a marketing team since this is a two-way medium of communication. Unlike most of the media that are used in traditional marketing exercises, customer targeted social media marketing allows the customer to engage with the marketing professionals or the company and can also influence other users to interact and engage. This aspect is described below through the diagram.

(Source:www.drexel.edu)

Hence, in customer targeted marketing using the social media companies have the opportunity to directly interact with customers are very low costs.

Therefore, the transformation from a traditional marketing strategy to a customer targeted one is not only necessary but also imperative given the ever changing customer dynamics and the fast developing modes of communication. While changing from a traditional marketing strategy and focusing on customer targeting, marketing professionals and companies need to conduct the following exercises to successfully implement customer targeted marketing strategies.

Construction of Customer profile characteristics or demographics with the help of the traditional and the classic marketing approach based on the age, sex, location, economic condition etc. of the customer.

Estimating customer value for the present and the future is also important so as to make a correct assumption of the target customer group that is the most valuable at present and would be growable in the future. In this matrix, the valuation of the current compared to the future is the most common of the approaches (Mullins & Walker, 2013).

Creation of customer lifecycle groups on the internet is important given the proliferation of digital media and the rapid popularity of the social media. This can be done through targeted behavioral emails marketing methods and personalization of websites.

Observing and noting customer behavior in response and purchase and then predicting the future behavior is also a growing trend. This is usually achieved through the information that it obtained through loyalty cards a large section of modern corporate distribute among the customers and encourage its use in the future. This is also known as the RFM or FRAC analysis.

Accurately predict multi-channel behavior of customers is necessary since this saves time and customers can be grouped according to ot media or channels and messages suitable for the channels can be created (Esteves & Resende, 2016).

Necessity of Change from Traditional to Customer Targeted Approach to Marketing

In today's world of business, the customer is the king. The products and the business process of sensible companies are oriented around what the customer wants and how such wants can be fulfilled by the company in a manner that is cost effective and leads to profits. Hence in modern marketing concepts, customer is central

For companies engaged in the creation of new products or services, the needs and wants that relate to the consumer are paramount issues. The plans to merchandise the developed products or services into profits also center around customers. Modern marketing experts do not assume that the present or the existing customers would continue to remain with the company given the rapid change in the customer tastes and the severe completion in a globalized economy. Another important aspect for marketing professional is possession of adequate market intelligence. A company's entire selling and marketing efforts could end up being targeted to wrong people if there is not enough credible market intelligence about what is happening with the market and the customers. Hence, without proper market intelligence, wrong people would have the wrong products. Hence as a marketing vice president, one should rely on and encourage the company and the team members to focus on and shift to a customer targeted marketing strategy (Mullins & Walker, 2013).

It is an accepted fact that any organizational change meets with roadblocks from within the organization as employees tend to resist change and maintain a status quo for fear of losing out due to the change. Hence as vice president of marketing it of paramount importance to make the employees understand the relevance and the importance of customer targeted marketing and the advantages it would bring and the pitfalls if it is not done.

As discussed earlier, if customer targeted marketing is not done then the goods produced and marketed would end up at wrong places. The wrong people would have the wrong products or services and the value of the products or the services would be lost business would suffer while completion would mount pressure and possibly eat p market share ultimately this would affect the company financially and when a company is financially affected employees would not be left far behind. Hence, it is necessary to align the goals of the company -- to attain financial stability and enhance market share, with the aims of the employees -- financial stability and job security (Pentina & Neeley, 2007).

The reasons for shifting to a customer targeted marketing strategy is stressed by the fact that there is a whole set of demographic changes that continue to happen in the market and with customers in modern business. For example, the growth of the teenage and young-adult market or the moving of the blue-collar workers to the suburbs, general increase in the disposable income and the global rise of the middle class and increasing the mobility of the population are all demographic changes that require adequate marketing policies. The previously targeted customer base might have shifted or their tastes might have shifted or even the disposable income could have increased and their demand and aspirations would also consequently change. Traditional marketing strategies would be unable to hold on to such changes and cater to the ever-changing needs of the customers. Hence, the role of customer targeted marketing becomes even more critical for customer retention and market share enhancement.

Social norms are changing and so are the influence of the society and the peers on the customers is changing at a faster pace than ever before. The advent of the digital age and the proliferation of social media has made is far easier for users to communicate and share information among themselves. With loads of information available on products and services thanks to the internet, customers have a much wider choice of products than ever before. Hence, companies need to generate market intelligence and adequately adapt to the changing customer states. While it is not always possible to accurately predict how each of the members of the customer group would behave, it can be offset by targeted marketing which while pinpointing the audience also reduces costs of marketing (Safko, 2013).