TARGET MARKETING TARGETING EVERYONE = TARGETING NOONE

1. TARGET MARKETINGTARGETING EVERYONE = TARGETING NOONE Michael PiczakJune 2004

2. WHO HAVE YOU TARGETED BELOW? • “I TARGET THE OLD AND THE YOUNG, THE RICH AND THE LOW INCOME…”

3. “I WOULD CUT ANYONE’S HAIR…” (and who would doubt it...) …BUT THAT’S NOT THE POINT

4. THE TENDENCY & OUR MISTAKE • TO ARGUE THAT YOU WILL GET YOUR MARKETING MESSAGES OUT TO EVERYONE • THE REALITY IS THAT THERE IS NOT ENOUGH MONEY OR TIME • WHEN YOU TARGET EVERYONE, YOU TARGET NOONE

5. IT’S SIMPLER THAN YOU THINK…

6. HOW MUCH MARKET DOES A COMPANY NEED TO BE SUCCESSFUL? • APPLE’s iPhone IS HOPEFUL TO ATTRACT 1% SHARE – 10,000,000 CELL PHONES • McDONALD’s SELLS FOOD TO ONLY 1% OF THE WORLD’S POPULATION • WALMART IS $¼ TRILLION IN SALES AND SELLS LARGELY IN THE U.S. AND CANADA • THE MAPLE LEAFS DRAW 17,000 PER GAME (17K/3M PEOPLE = %)AND ARE VERY SUCCESSFUL • DOFASCO IS A $3B COMPANY REPRESENTING XXXXX% OF THE CAPACITY IN NORTH AMERICA AND YET IS THE MOST PROFITABLE STEEL COMPANY IN THIS HEMISPHERE

7. HOW MUCH DO YOU NEED? • YOU NEED SALES/MARKET SHARE HIGH/BIG ENOUGH TO: • BREAKEVEN • PAY YOURSELF FOR YOUR: • OPPORTUNITY COST (WHAT YOU COULD EARN ELSEWHERE) • RISK TAKEN (AN EXPOSURE DIVIDEND) • RETURN ON INVESTMENT (X% ABOVE THE T-BILL RATE) • BLOOD SWEAT AND TEARS (HOURS, ENERGY)

8. MARKET SEGMENTS CARVING UP AN OVERALL MARKET INTO TARGETABLE CHUNKS BASED ON SOME CRITERIA SUCH AS: • DEMOGRAPHICS (AGE, INCOME, EDUCATION, GENDER) • PSYCHOGRAPHICS (ATTITUDES, INTERESTS, OPINIONS (AIO’s)) • TECHNOGRAPHCS (MOUSE POTATO, GEEK) – www.forresterresearch.com • BENEFITS (WHITE TEETH, HIGH SPEED) • USEAGE (HEAVY vs. LIGHT VS. RECREATIONAL VS. SERIOUS) • LIFESTYLE (ACTIVE, JET SETTING) • CONSUMER/INDUSTRIAL/COMMERCIAL/GOVERNMENT/MILITARY

9. $300M AIO: “I AM PATRIOTIC” • AN ‘AIO’ QUESTION BURIED IN A 200 ITEM ON-LINE SURVEY TO MOLSON BEER DRINKERS RESULTED IN THE VERY SUCCESSFUL ($300M) “I AM CANADIAN CAMPAIGN” • WAS FOUND BY ACCIDENT THROUGH DATA MINING

10. WHO REGULARLY TARGETS • CUSTOMS/AIRPORT SECURITY OFFICERS (female shoppers, racial profiling) • POLICE WITH SPEED TRAPS (roads from highways, transition zones, road to highways, bottom of hills, flat roads) • STUDENTS WHEN THEY STUDY (particular topics based on need to know; acting on professor’s hints/emphasiss) • TELEVISION PRODUCERS (varies by show) • SPORTS TEAMS (Bulldogs = families; Leafs = ????) • COCA COLA (selected campaigns go after particular segments) • BEER COMPANIES (18-35, male, sports lover) • SATURDAY NIGHT LIVE (urban, 25-50, $) • JERRY SPRINGER (lower income, female) • SOAP OPERAS (house wife, Caucasian) • CRIMINALS (seniors, individual walking alone, empty homes during day time, particular cars, particular parking lots) • YOU: (cleaning your car, cleaning yourself up, studying, networking)

11. EASILY IDENTIFIED TARGETS HOME OWNERS CHILDREN 18-34 MALES 18-49 FEMALES COMMERCIAL OPERATIONS INDUSTRIAL OPERATIONS • FAMILIES • SENIORS • FEMALES/MALES • HIGH/LOW INCOME PEOPLE • CITY DWELLERS • APARTMENT DWELLERS

12. DIFFICULT TO HIT TARGETS • GROUPS THAT COME IN EVERY SHAPE, SIZE, AGE, INCOME BRACKET SUCH AS: • GOLFERS • FITNESS BUFFS • VOLKSWAGON OWNERS

13. TARGET MARKET DEFINED GETTING IT RIGHT

14. VALUE SEGMENT IDENTIFIED BY LAKEPORT BREWERY

15. SEGMENTATION CHART FOR RUNNING SHOES

16. NAME THE MOST OBVIOUS TARGET FOR THESE PRODUCTS • MAZDA MIATA • CADILLAC ESCALADE • MP3 PLAYERS • ROLEX WATCHES • HAIRCUTS • MEDICAL WIGS • LETTERMAN/LENO/O’BRIAN • 60 MINUTES/THE VIEW/OPRAH/SPRINGER

17. INFORMATION SOURCES • DATABASES SUCH AS: • Inform New Hamilton (Human Services) http://www.inform.city.hamilton.on.ca/ • Hamilton Business Directory http://www.hamiltonbusinessdirectory.ca • PIC Hamilton http://www.pichamilton.net • Go Steeltown - Members Business Directory http://www.go-steeltown.com/business_directory/index.html • Halton Business Directory http://www.region.halton.on.ca/business/hbd/Statistics Canada http://www.statcan.ca/start.html • Strategis Company Directories http://www.strategis.gc.ca/sc_coinf/engdoc/homepage.html?categories=e_com • INFO-GO Services http://www.pace.gov.on.ca/english/ • Economic Development Related Information and Reportshttp://www.hamilton.ca • Community and Census Data http://www.on.hrdc-drhc.gc.ca/hamilton/english/lmi/lfpro/census/index.html

18. A WAY TO THINK OF TARGET MARKETING ON A SHOESTRING • PRETEND YOU HAVE $1000 TO SPEND • WHAT MESSAGES WOULD YOU MAKE UP WITH THAT $ • WHO WOULD YOU DIRECT THOSE MESSAGES TO GET THE MOST FOR YOUR $

19. GETTING PRACTICAL • REALITY IS THAT PSYCHOGRAPHIC AND OTHER MORE EXOTIC SEGMENTATION METHODS ARE RESERVED FOR LARGE COMPANIES AT BEST • STICK WITH DEMOGRAPHICS • YOU CAN DEFINE A SEGMENT OR TARGET ANY WAY YOU WANT BUT GET ######’s

20. THE PROCEDURE • FIRST DEFINE IT OR FIND A NEW ONE • THEN GET NUMBERS TO QUANTIFY YOUR TARGET MARKET • REFERENCE IT • DEVELOP MARKETING SUBPLANS FOR EACH TARGET MARKET USING 4Ps ANALYSIS • GO AFTER ALTERNATE SEGMENTS IN SUCCESSIVE CAMPAIGNS SWEEPING IN INCREASING NUMBERS OF BUYERS

21. GET THE NUMBERS FOR EACH TARGET

22. HOW FAST IS A MARKET GROWING+ REFERENCE+ GET IT RIGHT

23. ENSURING THAT IT MAKES SENSE

24. TARGETING GENDER FOR POOLS?? WHAT MIGHT MAKE MORE SENSE?

25. TOONEY TUESDAY AT KFC • POINT OF DEPARTURE IS THAT EARLY IN THE WEEK IS DEAD FOR FOOD SERVICE OPERATORS • NEED A PROMOTION FOR IMPROVING SALES • TARGET FOR TUESDAYS: ????? • 4Ps FOR TOONEY TUESDAY: ?????

26. RESULT: • # CUSTOMERS UP 60% ON TUESDAYS • PEOPLE COME IN LOOKING TO SPEND $2.30 PER PERSON INCLUDING TAX • LEAVE SPENDING $7.11 (+ TAX) PER PERSON (AVERAGE CHECK UP MORE THAN 300%) BY CROSS SELLING, SUPER SIZING, SEEING OTHER OFFERINGS, “GET ONE PIECE MORE FOR JUST A $1”, ETC.)

27. The Final Product: what it looks like

28. YOU’RE NOT GREEDY…YOU JUST WANT YOUR FAIR MARKET SHARE OF THE PIE YOU ARE HERE THE END TODAY’S MESSAGE: TARGET SOMEONE, NOT EVERYONE!!!!!! Michael PiczakJune 2004