c3centricity

The Risks of Not Knowing All 12 Essential Elements of Your Target Customer

Posted on February 8, 2022March 17, 2023 by Denyse Drummond-Dunn

I think it’s pretty clear to everyone in business that NOT knowing your target customers costs a lot – sometimes the business itself! (Think Kodak, Nokia, Borders)

So let me ask you this; how well do you really know your own target customers? Are they men, women, younger, older, Fortune 100 companies, local businesses? If you can at least answer that, then you have the basics, but how much more should you know about them?

Well I can help you there, with these 12 essential elements of a customer persona or avatar.

Background

I was recently working with a local service provider that was looking to improve their online presence. They were keen to have more impact on social media and had asked for advice about the best platforms, optimal frequency of publishing and possible content ideas.

They are a new client for me, so I think they were a little surprised when I didn’t get straight into the “sexy” topic of social media. Instead, I started by taking them through the basics of target customer identification. Lucky for them that I did!

When we had finished the exercise, we had actually found five different targets for them to address, rather than just the two they had been addressing until now. This clearly would have an impact on both where, what and how they communicated online.

It is for this reason that I always recommend that every brand and business completes a target persona and regularly updates it every time they learn something new about their customers. I also encourage you to keep it handy, ideally always visible on or around your desk. That way you will always be thinking customer first whenever you are working on a new project.

So let’s imagine that we’re having our first meeting together and I’m asking a few (well 12 actually!) questions about your customers. How many can you immediately answer?

The 12 Essential Elements of a Target Customer Persona

C3Centricity has designed a simple template that helps clients have all the essential information about their customers in one place, summarised on one page. It’s called the 4W™ Persona Template; if you haven’t already done so, you can download it, together with a detailed workbook explaining exactly how to complete it. Just click on the image below.

I would highly recommend you download it right now, before continuing to read, so that you can follow along with the one-pager in front of you.

Here are the 12 essential elements you need to have at hand in order to complete the template:

Click the image to learn more about the 4W™ Persona Template & download the workbook.

1. WHO – DEMOGRAPHICS: This is usually a “no-brainer” and is how most organisations describe their customers. However it’s not really original and definitely not competitive, although they are an essential foundation.

But there is so much more you should and absolutely must know about your customers, so read on.

2. WHAT THEY USE: Whether you are offering a product or providing a service, you need to know what your customers are currently using. And not only for your category, but in adjacent categories too.

In some categories, customers can replace a brand by another in a different category. Think about food or beverages. A customer could replace a cola by a still fruit drink, or a pasta dish by a pie. You therefore need to understand what your customers would use, if anything, when your product or category is unavailable.

Whether you offer a product or provide a service, you need to know what your customers are currently using. And not only for your category, but in adjacent categories too. #Brand #Marketing Click To Tweet

3. WHAT THEY CONSUME: Here we need to understand what types of information and media your customers are consuming. What do they read, watch, listen to, both in work and in their spare time?

Which social media platforms do they use, and what websites do they consult on a regular basis? Which are their favourite influencers, the companies, brands or people that they follow online?

4. WHAT THEY DO: How do your customers spend their time? What type of lifestyle do they have? What are their hobbies? What do they do all day, and in the evening, and at weekends?

It would be ideal if you can create a detailed timeline of their average day, so you have a feel for their moments of stress, boredom or relaxation. This makes it much easier to see how your brand might fit into their lives.

Create a detailed timeline of your customers' average day, so you have a feel for their moments of stress, boredom or relaxation. This makes it easier to see how your brand might fit into their lives. #Brand #Marketing Click To Tweet

5. WHAT THEY BUY: This is where you describe their current category purchasing habits. How frequently and what quantity do they buy? Are they loyal to your brand or do have a portfolio of brands from which they choose?

Do they have regular daily, weekly or monthly buying habits? Do they do research before buying or repurchasing? Do they compare and if so how, where, and why?

6. WHERE THEY CONSUME: Is the category consumed in home, in work, during leisure activities? Is it used locally, regionally or is it more used on vacation?

Are your customer with friends, with their partner, with colleagues when they consume the brand? Are there certain surroundings more conducive to consumption? If so, what makes it so?

7. WHERE THEY BUY: Do your target customers have certain places and times when they tend to buy? Is it an habitual or impulse purchase? Is it seasonal? Are they buying at a certain place at certain times of the day, as they go about their daily lives?

Are there only a certain number or style of outlets where your brand is available, or can your customers buy it wherever they are? Do you limit distribution to particular retail types, like supermarkets, specialty stores, or professional service stores? Are they the same ones your customers frequent? And what about the category in general? Do some brands limit distribution?

8. WHERE THEY READ/WATCH/HEAR: From where do your customers get information about the products and services they consumer? Is it from manufacturers, from friends, their family or their colleagues?

Do they access it online, in print, on radio or via TV? Are your customers at home, in work or on the road?

Remember that today “read” covers not just traditional media but new media as well. Which websites, social media channels and people do they follow, like, listen to and value the opinion of?

9. WHERE THEY SEE: One reason to target a specific group of customers is so that you can better and more effectively communicate with them. Where are they most likely to be open to receiving your messages? What media, at what times, on which days?

Do they use different media for different purposes? For example, do they review websites in work for information, then look at other sites in the evenings and at weekends for entertainment? How does this difference impact your brand?

10. WHY VALUES: What values do your customers have that you are addressing with your product or service, and which explain why they are using your brand rather than another? Do they have other values that are not currently being addressed, either by you or your competitors?

If so, could they be highlighted in communications to attract more customers? In other words, do these values offer the possibility of a differentiated communications platform or even product / service concept? What resonates with them in particular about the category, your brand, your competitors’ brands?

11. WHY EMOTIONS: What is the emotional state of your customers when they are considering a purchase or use, both of the category and your brand?

Clearly identified emotional states enable you to more easily resonate with your customers through empathising with their current situation. You are also more likely to propose a solution that will satisfy their need or desire when their emotional state is precisely as you have identified.

12. WHY MOTIVATIONS: What motivates the customer to consider, buy and use the category and their brand choice? Emotions and motivations are closely linked, both to each other and to the customer’s need state.

By identifying the need-state you want to address, you will be better able to understand your customers and increase the resonance of your communications with them.

What motivates your customers to consider, buy and use the category and their brand choice? Emotions and motivations are closely linked, both to each other and to the customer’s need state. #Brand #Marketing Click To Tweet

Final recommendations

If you can answer all twelve of these questions in detail, then you certainly know your customers intimately. But I have a word of warning before you sit back and relax on your laurels.

Remember that people are constantly changing and what satisfies them today, is unlikely to satisfy them tomorrow. Therefore you need to keep track on all four layers of your customer description, to stay ahead of the competition, as well as to satisfy and hopefully delight your customers just as much going forward.

People are constantly changing & what satisfies them today, is unlikely to satisfy them tomorrow. Track the changes to stay ahead of the competition, & satisfy, delight your customers. #Brand #Marketing Click To Tweet

As already mentioned at the start of this article, by completing a detailed description of their target audience for my client, we were able to identify a couple of new segments that their services could address. Although their demographics were similar, their emotional and need states were quite different. This gave us the opportunity to successfully respond with slightly different service offerings for each group.

The 4W™ Persona Template is one of the best ways to develop an avatar or persona for your brand. Our clients love it, so I know you will too. It can be downloaded together with a detailed workbook explaining how to complete it, by clicking the button below.

If you enjoyed this article, please consider sharing it with your peers and colleagues. They will thank you for it, especially since it includes a link to a free workbook on developing brand personas / avatars!

How to Sell More to Less People: Essentials of Segmentation

Posted on May 1, 2021December 7, 2021 by Denyse Drummond-Dunn

Businesses often make the mistake of trying to sell to everyone. Are you guilty of this?

Why is this a mistake? Well, if you try to please everyone you end up delighting no-one. This is why best-in-class marketers work with best-practice segmentations. And targeting the biggest group is not often the best strategy. In fact it rarely is. Read on to find out why.

Your brand needs to appeal to a group of customers who are looking for the solution you are offering. This means that you need to make a choice of who to target amongst all category users. Making a choice implies that you will have to ignore some category users who you could perhaps attract. This seems counter-intuitive and makes many marketers scared. Does it scare you not to try and go after everyone?

It certainly worries many marketers and yet it’s the only way to sell more. Although this may not sound like common sense at first, segmentation actually ensures that you have the best possible chance to satisfy the needs of your targeted customers. Once you are satisfied with your results, you can always go after secondary target groups.

But let’s start at the beginning with the essentials of segmentation.

Where to start

When deciding who to target, most companies conduct some sort of analysis. This can be as simple as identifying your users by what you observe, such as young men, older housewives, or mothers of large families. And although these are easy to articulate, you are working with demographics, something every other brand can do as well. It also has the weakness of not truly understanding why your customers are choosing your brand – or not – over competition.

It therefore makes much more sense, to move on to a more sophisticated segmentation, just as soon as you can. Why? Because it is far more powerful. For example, rather than appealing to “young men”, targeting “those who value freedom and are looking for brands that can provide or suggest this dream” will immediately provide a clearer image of the group. Even if the majority of the segment are young men, the description is far more actionable. Do you see why?

Providing a detailed description of your target customers will always have the advantage of making engaging them that mush easier, because you will be speaking “their language.”

Types of segmentation

I mentioned above that you can simply use demographics to segment all category users. But I also alluded to the fact that it is not very distinctive, nor competitive. The sooner you can run a more complex segmentation the better.

The first thing to know about the essentials of segmentation is that there are five main types:

Firmagraphics: This is the most basic and is usually how the industry separates the different types of products and services. For example alcoholic versus non-alcoholic beverages, or still and sparkling, or bottles versus cans.

The consumers of the different types of beverages are easy to identify since the products they buy are too. As the grouping is based on the consumers of the different products, this is not a very useful segmentation for marketing, since consumers can appear in more than one segment. And as you will see below, one of the criteria of a good segmentation is that customers can only appear in one segment. However, product segmentations are useful for operations, sales and retail.

Demographics: As already discussed in an earlier post called “The 3 Rules of Effective Targeting”, the deeper your understanding of your target customer is, the more likely it is to provide you with a competitive advantage. I think the example I mentioned at the beginning makes this crystal clear, no?

Geographics: Included here are all the possible descriptions relating to your customers’ geography, such as country, city, language etc. Depending upon whether you are targeting a specific geographic area, or a type of place based upon weather, languages spoken etc, this type of segmentation will help you to go beyond simple demographics and be more precise in the people you are targeting.

However, because it is grouping of people by geography alone, it is assuming that all those in a group will be similar. As we all know, although there are zones in cities and countries where inhabitants are similar – many cities have an area called China Town for example – it is in my opinion dangerous to think that they will all behave and purchase in the same way. That’s why the next level of segmentation is more powerful.

Behavioural: At this level of segmentation, we are looking more at how customers behave, rather than simply who they are or where they live. Types of behaviour we might include could be what solution they are looking for based upon the benefits of a brand, how, when and where the customers buy, or where they are in terms of lifecycle or engagement with a brand.

With this segmentation, we are now grouping customers by what they do, so we at least know that they are behaving in a similar way. However, it is assuming that they behave for the same reasons, something of which we can’t be sure. That’s why the next level of segmentation provides the ultimate and most actionable clustering of customers.

Psychographics: This is amongst the most sophisticated and complex segmentations you can run. But going this deep into your understanding of your customers will ensure a competitively strong position for your brand. Included here are grouping category users by values, attitudes and opinions, interests, personality or lifestyle. I think it is very clear in looking at this list, how your segmentation using one or more of these criteria would produce the most detailed and in-depth understanding of your target customers.

Once you’ve run your segmentation and chosen the most relevant and profitable target group (I’ll speak more about that in a moment), you still need to do more. You see segmentation alone is insufficient for successful growth. As soon as you know who you are targeting, you need to then get as close as you can to your target customers, in order to understand them as deeply as possible. This should be done through regular listening and observation.

The MIDAS touch

Whatever method you use for segmenting and choosing your target customers, the results of your exercise of customer grouping needs to meet the following five conditions, known collectively as the MIDAS touch.

Whatever methods you use for segmentation and choosing your target customer group, the results must meet the five conditions, known collectively as the MIDAS touch. #Segmentation #Grouping #Brand #Marketing Click To Tweet

Measurable: The individual groups need to be clearly defined and quantifiable using KPI’s such as size, market share, value share.
Identifiable: Each segment must have a distinct profile and each customer must be attributed to only one segment.
Definable: Every cluster must be easy to describe and share with others so that you have mutual understanding of each of them.
Actionable: The groups must be easy to identify, in order to be able to target your actions and communications to them.
Substantial: The chosen segment must be financially viable to target, which means that it should, in general, be stable or growing, and durable over the long term.

All good segmentations or clusterings will fulfil all five of these key conditions, or at least they did until recently. Today the last condition is being adapted thanks to personalisation. It is more important to assess whether or not it is sustainable rather than substantial. Which term is more relevant in your own industry?

In evaluating your segmentation with MIDAS do you look for substantial or sustainable? Which is more relevant in your industry? #Brand #Marketing #Segmentation Click To Tweet

Even with this change, it is still easy for you to evaluate your segmentation, to ensure it is both valid and robust. If it does not meet these five conditions, then you will struggle to activate it and target your actions to your chosen group of customers.

As already mentioned, understanding your target as completely as possible is vital to the success of your business. I would, therefore, suggest that you review your own segmentation and decide how it can be improved. (There’s always room for improvement, isn’t there?)

This may mean simply completing the information you have on each segment. Or it may mean running a whole new segmentation exercise. However, it is definitely worth getting your segmentation and target customer choice right. After all, they form the very foundation of your brands’ customer-centricity.

A solution for those with few resources

If you do not have the time, money, or expertise to run a detailed segmentation study, you can still make an informed decision based on simple criteria. These could be gathered by mere observation, an analysis of who your purchasers are, or a review of contacts from your customer services group – taking into account that these may be biassed.

Once you have identified the different types of users you are attracting, you can then decide which is the most important group for you to target. You can do this by simply choosing the largest group, but as already mentioned large doesn’t always equate to most profitable. For this reason, I suggest using what is often referred to as the Boston Matrix. This analysis was first developed in the 70’s by the Boston Consulting Group. At the time, the matrix was created to help corporations analyse their business units and was based on market growth and relative market share.

Today this scatter plot is created using various elements to make up the two axes (see example below). While the criteria you use for each axis can vary, this simple analysis has the advantage of being able to be further refined over time, as you get more information.

Choosing the criteria for the axes

The two axes you specify for the Boston Matrix can be as simple or as complex as you like. Obviously, the more criteria you use, the more accurate your analysis is likely to be. Examples of the criteria you can use include:

Attractiveness: Segment size, segment growth rate, segment value, competitive environment, profitability, industry structure, distribution, pricing, environment, seasonality, how well the group fits the company or brand – or vice versa.

Ability to win: market share, differentiation, brand strength, distribution strength, company profitability, customer appeal, customer loyalty, your media mix, your reputation, your production skills, management strength.

You can use any or all of the above suggestions for creating the two axes. If you use more than one criteria per axis, you must decide whether to average or weight them.

C3Centricity provides an automated tool for calculating the two axes and then positioning segments on them. This is made available to all participants of the Customer Centricity Catalyst Classes, which you can learn more about here.

Choosing the actions to take on each segment

Once you have positioned the different segments or groups of customers on the axes, you will easily see what needs to be done for each group:

Target: these are your core customers as they are both attractive to the business and easy for the company’s product or service to attract them. Therefore, they need to be protected from possible attacks by the competition.

Convert: these customers can be attracted to your product or service but your ability to win them is currently low. To win these customers you probably need to consider improving one of the elements of the mix in order to attract them.

Grow: your product or service can easily win these groups but perhaps they are not as profitable as you would like. This might change, so it is important to review them from time-to-time or develop a different strategy to attract them.

Ignore: many organisations struggle to make the decision NOT to go after a group of category customers. But if you have neither the product / service nor the segment conditions that would be profitable for you, why spend time, money and energy going after them?

This simple analysis can be made as sophisticated as you like through your choice of criteria for the axes. That is why despite being over fifty years old, it continues to be used by many organisations for their brands.

Conclusions and next steps

All businesses want to sell more. They also want as many customers as possible. And do all this while growing their profitability. However, as we have seen, trying to sell to everyone is unlikely to meet with the success you hoped. But now you have the solution.

Choosing the right group of customers to attract with your product or service is the essential first step. But so is then doing everything you can to understand your chosen segment as deeply as possible. Truly customer centric organisations excel at doing both; do you?

Truly customer centric organisations excel at both identifying the best group of customers for their offer and understanding them as well as possible; do you? #Segmentation #Brand #Marketing Click To Tweet

Need help in segmenting, identifying or understanding your target customers? Let us help you catalyse your customer-centricity. Contact us here or check out our training offers here.

C3Centricity used an image from Denyse’s book “Winning Customer Centricity”

This post is regularly updated from the original version first published on C3Centricity in 2013.

Tag: Target customer