I was talking with a young aspiring entrepreneur in the pub on Friday night. We were talking about his business idea and got on to the subject of his business plan. I wanted to briefly share what we talked about.
I asked him some questions to test how much he had thought about his idea beyond the dream. When I asked him about his target market, he wasn’t able to define any characteristics about them other than they were between 18 and 38. I asked him to tell me who an ideal customer would be:
- What sort of jobs would they have?
- What sort of income would they have?
- Where would they be living?
- How much expendable income would they have?
- Where would they hang out?
- What were their pastimes?
After a little more probing about his product, he explained that the users would mostly be lower income bracket, single, likely living at home with the parents. OK, so we’re starting to get somewhere…
I then asked him to flesh out these people and he described them as ‘media’ people who liked gaming and going to pubs.
His product is a generalist magazine that will be issued in print. Whilst the magazine would be sold, the majority of the revenue would come from advertisers.
When I asked him about his plans for marketing, he thought he would use a Facebook page to generate a following. He would also ask pubs to sell his magazine for him and he’d place free copies in local dentist surgeries.
He planned to approach banks and other investors to fund his costs until he brought the business into the black. I was a little concerned that he might be disappointed by their response given the lack of clear direction for his business plan at this stage, so I offered a little direction.
Rather than ‘splattergun’ his marketing to wide range of individuals such as 18-38 age group, begin by zeroing in on a smaller age range. He can be precise about who he targets and measure the results of his marketing campaigns to see what works best.
If you think about TV advertising, you’ve probably seen an ad 7 times before you notice it properly. If he spends his marketing budget on a smaller segment, such as 18-25 year olds, he can tailor the material and get a better response from them. Surely that’s far better than trying to appeal to all people and maybe only get in front of their eyes the one time and go unnoticed.