Did you know that, according to Investopedia (data collected from the U.S. Bureau of Labor Statistics), 20% of new businesses fail in the first two years and 45% fail in the first five years. They also claim that the statistics have remained the same for the past two decades. There can be many reasons why new businesses fail, but one of the most important factors that act as a catalyst for the destruction of businesses is the, “Understanding the market” factor.
Today’s market is volatile. It changes in a matter of seconds and ripples the effect throughout the world. It is absolutely necessary to understand the market in order to survive in the world of business. But, what does “understanding the market” mean? Is there a way to do that?
Yes, there is a way to understand the current market. In fact, there are a lot of ways to understand the market, and these approaches can correlate with one another to give you the best result for your marketing campaign.
One of the first steps towards understanding the market is by implementing a method called, “Targeted audience profiling.”
And that is what we will discuss in this article. This article will discuss,
- Target Audience Profiling – What Is It?
- Why Is Target Audience Profiling Important?
- Collect Data for Your Target Audience Profiling
Target Audience Profiling – What Is It?
Target audience profiling (AKA audience profile) is an approach where you create a profile of your potential customer by gathering data from various sources. Now it might sound vague, but the gist of it is, creating a profile of your potential audience.
The main objective of target audience profiling is to find the “ideal” customers for your business.
Here, we have to address the misconceptions that, the “target market” is the same as “target audience profiling.”
Target market is the collection of target audience profiling that covers wider potential customers.
Now, back to target audience profiling. So, how do you do it?
Audience persona (AKA target audience profiling) is all about behavioral patterns along with important data. By analyzing customer behavior across various platforms, you can get the necessary data to create a profile of your target audience.
Collect the data and separate them into a cluster based on the factors that are distinct from one audience to another.
This really helps to structure your marketing campaign for a specific target. Now, this might seem more complex and elaborate. Target audience profiling is a complex process that involves several elements and factors.
But, there are ways that make the process less complicated. For example, after collecting data, you can implement the machine learning algorithm to separate your target audience.
There are machine learning algorithms, such as the K means clustering algorithm and BIRCH algorithm where you can use it to get the segregated data of your targeted audience.
These algorithms are simple enough that you feed the data (probably the existing data), train the algorithm, and then insert the new data (from your targeted audience profiling). The algorithm finds the pattern and separates the data in the form of “clusters.”
The possibilities are literally endless with machine learning algorithms. One such possibility is that YOU can define how many clusters you want. This gives you an idea of what factors are distinctive among your audience and how you can use those factors to your advantage to create a unique tailored campaign for your target audience.
Now we know that targeted audience profiling is the collection of data in order to find the ideal customer base for your business.
But, why it is so important that all businesses do target audience profiling?
Why Is Target Audience Profiling Important?
For any business to succeed in its field, it is really important to speak the customer’s language. Knowing who your target audience is can make a huge difference in your business. For example, take an e-commerce website focusing more on adults and senior people.
According to International Communication Union, 71% of youths use the Internet worldwide, and 57% of the rest of the population. With this one data point, it is evident that the e-commerce market should focus on youth. But that does not mean that it shouldn’t focus rest of the population. Young people should be more of a priority and can yearn for more business.
With this data, you can pick out your target audience, and tailor your marketing strategy and campaigns accordingly.
With target audience profiling, you can get more opportunities. Meaning, with the collected data, you can be more personalized in your marketing strategies. It really helps to build solid personalized campaigns for your target audience, which has the potential to address several issues faced by your target audience.
Then you can send the campaigns to your target audience through their favorite medium (which is also in the data collected for your target audience profiling)
There are a lot of surveys, such as the Jeeng customer behavioral survey, which says, almost 60% of the U.S. population prefers a personalized email that contains content that solves their needs.
Sending out personalized emails to your target audience is also one of the factors that can boost your business. The main way to provide such emails is by implementing target audience profiling.
Another survey says that personalizations yield better results, and can increase your business revenue by 10-15%. It also states that personalization became more important after the pandemic situation, and 71% of consumers expect companies and businesses to provide them with personalized interactions. Additionally, 76% of consumers lose interest when personalization is absent.
This data helps to understand your target audience more and their needs. It is helpful in creating a marketing campaign around this data, which can yield better results for your business.
Lastly, it is important to retain existing customers. Finding new customers for your business is important, but retaining the existing ones is the factor that helps you to stay afloat in the business.
Using the data from the target audience profiling can help you understand your customer’s pain points, and take necessary actions to resolve their issues to the customer’s satisfaction.
One of the types of data that should be collected for an audience persona is demographic data (real-time data). Understanding where your customer resides can help to address their need effectively. For example, in the U.S., creating personalized marketing campaigns (ads) around Black Friday and Cyber Monday can help to keep your audience in the loop and intrigued about your products.
After the pandemic, there was a notable decline in brand loyalty, and the main reason might be not understanding consumer needs. Data about your existing customers and new customers can increase your brand loyalty regardless of demographics.
Now that you know what target audience profiling and its importance are, it is time to look at how to collect this data about your target or potential customers
Collect Data for Your Target Audience Profiling
First and foremost, always start with numbers. Numbers don’t lie. Take this example. You are a new business owner trying to build a target audience profile. This means, our resources are constrained, and you need to find a tool(s) to give you good insight into your target audience. One such tool is Google Analytics.
Google Analytics (or GA) is a free tool that gives real-time business insights. With GA, you can access a wide range of data, such as demographics, age, gender, interest, and even the type of devices that your target audience uses to access the website.
Now, you can also check which cluster of your target audience visits a particular service or product, and the CTR (Click Through Rate) for those visits. Knowing what type of devices your target audience mostly uses also helps you to tailor your marketing strategy or campaign towards that particular device.
All in all, if you want more data aka numbers then GA is your best friend for your business.
The next tool is the CRM (Customer Relationship Management) tool. Every business should have a CRM tool. It is one of the most important tools in all of your business. It is a record that has all the data about your customers, and all the interactions that got you the sale. CRM is one of the best ways to know how to attract new leads for your business.
Always having a good CRM and GA can help you to cover most of the required data for your target audience profile.
Now, these research are all indirect, meaning you are not interacting with the customer (real-time) to get the data. As said, most of the potential customers expect personalization and this is where “qualitative” research comes into the picture.
You have the demographic data for your target audience and you can leverage it to create a survey.
The survey helps to understand the consumer’s pain points. Your survey can vary depending on various factors including the demographics element. But, the following questions can be generalized for a better understanding of your target audience:
- What is the current pain point(s) or problem(s)?
- What is the outcome when they try to use another approach?
- What is the solution they are expecting?
These questions allow you to tailor your marketing campaign for your target audience.
So, a summary:
- Google Analytics or GA is best for getting demographic information and other data, such as the type of devices, and CTR customers use.
- CRM (Customer Relationship Management) is very important for the business to get data about their customers, and find new leads.
- Create a survey to understand your customers in real time and learn about their pain points.
Other tools, such as Ahrefs (for keyword research and analysis), and GSC (Google Search Console) are good for SEO (Search Engine Optimization). Optimizing your website for Google helps to gain more online visibility and brand awareness. That way, you can reach more of your target potential customers.
Next is psychographics. Now, don’t be alarmed, this may sound like very deep science, but actually, it is a qualitative process of understanding your target audience by their psychological characteristics.
Now, you have the data and the best campaign for your business. Without knowing your customer language (literally in some cases), regardless of how good your campaign is, it may not reach your target audience in the way you want it to.
Get the data and create psychographics of your target audience. This gives you a path how you to want to show your campaign to the world, i.e. your target audience. One of the best ways to collect data (indirectly) for your psychographics is to use Google Trends. It shows the data in real-time that people are actually searching for on the internet.
Out of all the target profiles, psychographics can be quite tedious. Since people’s mentalities change often, it makes it harder to understand them psychologically.
One of the first steps when it comes to collecting data for your psychographics (directly with potential customers) is to find an expert in your niche, or an influencer (on social media). Asking them questions about what do they expect from your business, and what the current trend in the market is that helps you to understand your target audience better.
It can be quite vague, but more questions can help you to get the data.
Now, last but not least, put all the data together from demographic to psychographics, and the result is the “ideal” targeted audience profile for the “ideal” target audience.
1. What are the stages of target audience profiling?
There is no fixed approach for target audience profiling, but there are general pillars that can be helpful for building a reliable target audience profile. And the pillars are:
2. What are examples of targeted audience profiling?
When it comes to targeted audience profiling, you can gather data, such as demographic, buying patterns, and psychological behavior towards the buying pattern that can help to create a reliable targeted audience profile.
3. What are the four key ways to identify a target audience?
The four key ways to identify a target audience are geographic, demographic, psychographic, and behavi
Business is all about understanding your audience. The best way to understand them is through targeted audience profiling. Having a good and reliable targeted audience profile ultimately improves your business and ROI (Return on Investment). There is no absolute process that can help to fully understand your target audience. There can be knowledge gaps. But in each step, you will learn something new either about your business or your audience. Collect the data in each step, and eventually, you can have a mountain of it which surely helps you to succeed in your business!
We, at Appointments.co strive to provide the best result for clients in a short amount of time. We specialize in identifying the ideal customer profile and delivering high-quality results. Check out our website, or talk to us now, to bring your business to the next level!
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