STYLE | Business
A GAME OF CHANCE OR A GAME OF SKILL?
Mass marketing can be likened to a game of chance. You place your bet, then wait for the odds (and sheer weight of numbers) to hopefully fall in your favour. In contrast, more personalised and direct marketing is a game of skill. One where, unlike mass marketing, you can better control the outcome. It also costs less
M
ost people have a natural distrust of being sold to and wish they could avoid all that “sales and marketing stuff.” It’s not that selling is bad, just that mass
marketing has trained people to believe that selling means someone taking something from them (money, information, time etc). It’s the natural result of growing up in a culture driven by mass marketing.
A targeted approach to acquiring new customers is more effective. You can reflect the very best of your business and your ability to address a target’s specific needs or wants through content and a method of approach specifically tailored to suit them - making the chances of getting their attention and subsequently achieving success very high indeed.
It’s also significantly less expensive through its low volume approach, reduced waste and low and no-cost marketing methods that aren’t practical for mass marketing. It builds greater differentiation and loyalty from the start.
This change has been slowly taking hold over recent years. GDPR heightened this, and the need for businesses to be more targeted will only become more pronounced. Businesses must establish direct, more localised, personalised and relevant dialogue with consumers; dialogue that adds value.
Many believe that a constant churn of new enquiries and business builds success. The reality is very different. As Pareto suggests, approximately 80% of your business comes from 20% of your customers, for many as much as 90% comes from just 10%.
So, do the maths and ask yourself - do you want to build your business success by investing heavily in the mass market 80% or 90% that take up most of your resources but add little to your business, or would you rather focus your investment on the 10%-20% of customers that are your future? I know which my clients prefer.
Dale Howarth is an acclaimed business speaker, mentor and writer; working with individuals and companies to make the business leaders and businesses successes of tomorrow. To find out more visit
www.dalehowarth.com.
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Put another way. If you have 500 active customers, as few as 50-100 of these represent the real value in your customer base. These customers actually value what you do, want to build a relationship, and are open to new products and services, happy to give recommendations and to be part of your success.
So, to grow your business surely it’s better to target the 50-100 new customers that could double the size of your business, rather than the hundreds or thousands needed through resource-intensive mass marketing that at best may add just 10%-20% to your revenues?
It gets even more interesting when you consider that the same goes for your competitors. If we target our competitors’ ‘top’ customers, we gain even more. Once converted, we not only get a high value customer, but rapidly start affecting our competitor’s profitability.
In ‘Hyper-Competitive’ markets this gives you ‘attacker’s advantage’, driving competitors to act irrationally as they work even harder to retain customers and start to be increasingly nervous, possibly even paranoid, about what you may do next.
If you have any doubt whether driving your business success by being more targeted works, consider for a moment just one of my clients: over the past year alone they’ve more than doubled revenues and tripled profitability, by gaining fewer than 20 new customers.
By Dale Howarth BUSINESS MENTOR, SPEAKER AND WRITER
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