Using Market Research to Guide Your Marketing Strategies: Part 1
Market Research & Target Markets
When you establish a business, regardless of industry, there are usually two things that are scarce: time and resources. To ensure you are not wasting time and money, it pays off to create an effective business plan, which means…you will need a marketing strategy.
Your success is often only as effective as the marketing strategy behind it, helping guide your business toward increased profits and ROI. The best marketing strategies are built upon 4 key components:
- Market Research – research is the backbone of your marketing strategy – serving as the foundation from which all strategies and tactics are developed and executed. Identify consumer buying habits in the industry, market size, market growth or decline, and any current trends.
- Target Market – a well-designed target market identifies your most likely buyers, also known as customer personas. To cover all bases, you should aim for at least two or three levels of audience segmentations (or personas) and tailor strategies to each of those segments.
- Competitive Analysis & SWOT – you need to know who your competitors are and how your products and services are different. What is the price point at which your competitors are selling, and what segment of the market are they aiming to reach? Knowing the ins and outs of your competitors will help you better position your business and stand out from the competition.
- Positioning – what is the perception of your brand in the marketplace? The difference in how the target market sees you is your positioning. Therefore, you want to develop compelling branding and marketing messages that clearly communicate how you want to be perceived.
Your marketing strategy is essentially the path to your sales goals. It answers and explains some of the core questions every business should be asking:
- “How will will find and attract our most likely buyers?”
- “How can we engage them to help close the sale?”
Your strategy should look at the entire marketplace and break down specific tactics, such as events, direct mail, email, social media, content strategy, street teams, couponing, webinars, seminars, partnerships, and other activities that will help you gain access to customers.
In these next two articles, we’ll help with a brief overview of these segments. But today, we’ll start with market research and defining your target market.
Sales and lead generation are dependent upon the reach and effectiveness of your message, and the way in which your message is received. If you want a practical and effective strategy, you first need to know who your audience is and the best way to get your message in front of them – this is when market research enters the picture.
Industry and market reports are perfect tools for conducting market research, as they help you to define and understand your target market, customer demographics, their location, as well as market saturation…these reports will stand as the first building blocks of a strong foundation on any business model.
For businesses operating in the pool and spa industry, some main areas of interest would focus on analyzing industry trends, localized market data, main competitors, and consumer demographics. The insight gained from these reports allow us to appropriately break down that information into useable data that will improve your customer targeting and effectiveness, saving you time and money!
Market research is often a key element in defining your strategy – the results can be simplistic with numbers and statistics on local markets, or the research can be more in-depth if you are interested in qualitative analyses, such as customer feedback, focus groups, one-on-one interviews, etc… but we’ll save that for another time!
An analysis of your market area and consumer demographics offers insight into who your customers are, where they are in your market, and their consumer-purchasing decisions (buying behavior). For example, a pool chemical company is thinking about opening a storefront or distribution yard in a new city…it would benefit you greatly to know how many people in that market have pools, the type of pools, and where those pools are located.
It would also help to have a rudimentary knowledge of industry trends in connection with current events (what might be influencing the market as a whole), such as the COVID-19 pandemic of 2020-2021. The pool and spa industry saw a HUGE boost in lead generation and sales during the pandemic because families were forced to stay at home, and they were looking for something they could use at home.
Using market research as part of your marketing strategy will help guide you toward better business decisions, setting you up with the right product launch at the right time, and how to get it in front of the right people in the right place; this will ultimately allocate your marketing budget to wherever it’s going to get you the best results.
THE TARGET MARKET
Gathering demographic information provides a way to better understand those opportunities and limitations for gaining customers. This could include population data on age, wealth, family, interests, or anything else that’s relevant for your business. Armed with this information, you can categorize your different customers into audience segments — what we refer to as “personas” – to distinguish those consumers who would be interested in buying your product or service, separated by their demographics, and the best method of approach for each audience segment.
Identifying and understanding your audience is KEY to any effective marketing technique…it always has been. The customer base sets up the foundation of your business and allows you to improve sales and increase ROI by maximizing on your advertising budget with a more cost-effective approach, reducing risks and improving targeting methodology.
There are probably PLENTY of small businesses that feel they understand their everyday customer, only to conduct market research and learn they had the wrong assumptions. By conducting research on the forefront, you can create a profile of your average consumer and gain insight into their buying habits, how much they’re willing to spend, and which features resonate with them…NOW you can create better marketing messages that speak to your target customers.
If you are a pool builder, and you have one area of town that is an older part of town, with older residents (maybe grandparents looking to get a pool for the family and grandkids), depending on age deviation, you would probably opt to employ some of the more traditional marketing tactics, such as print advertising, direct mail campaigns, coupon books, door hangers, and so on. If you have another area of town that is currently undergoing gentrification, or neighborhoods being renovated by younger couples (newlyweds) moving into the area, you’d probably want to utilize more modern techniques to attract and engage those audiences, possibly creating some geo-targeted ads that pop up on mobile devices, or social media advertising campaigns. The point is, different populations respond and engage with media that they know and are comfortable with, so marketing through those outlets will probably resonate better with each of the customer personas you designate.
It can also benefit your business to weed out those audience segments of market who are not aligned with your target customer base. In fact, for small businesses knowing who you do not cater to can also be essential in helping you grow. Why? Simple, if you’re small, your advantage is that you can connect deeply with a specific segment of the market. You want to focus your efforts on the right customer who already is compelled to spend money on your offer.
If you’re spreading yourself thin by trying to be all things to everyone all the time, you will only dilute your core message. Instead, maintain focus… on your target customer. Define them, go deep, and you’ll be able to figure out how you can best serve them with your products and services.
There is a lot of incredibly useful information out there that could aid in refining your tactics to be more time- and cost-efficient…you just need to tap into it.
PKDATA MARKET REPORTS & CONSULTING
At PK, we know how chaotic and volatile the pool and spa industry can be at times, and we know that many companies don’t have the money or manpower that is required to collect this information; nor do they have time to understand and apply it in a meaningful way to real-world situations…but that’s OK…it’s also why we’re here – we take some of the pressure off and provide you with the data and analyses needed to grow your business.
We have tracked the US and global pool and spa industry since 1992. In that time, we have compiled a wealth of swimming pool industry statistics and market data. Our swimming pool and spa industry data is utilized by all the leading manufacturers, distributors, retailers and builders.
Pkdata’s annual industry reports are a standard planning tool for firms in the US and overseas. Moreover, the firm’s pool and spa industry market data has been a valuable source of information for merger and acquisition due diligence, as well as pool and spa new product development.
We publish market reports covering a wide range of topics concerning commercial pools, residential pools and spas, as well as hot tubs. In short, whatever your swimming pool, spa or hot tub market data needs, Pkdata analysts can not only work with you to provide the research and statistics you need, but we can help you develop your customer for a more effective communication and marketing strategy.
As the aggressive environment your business faces continues to become increasingly competitive, so too will the market competition. It’s probably safe to assume that your competitors are buying or conducting research to gain their own advantage…so maybe it’s time to find your company’s competitive edge…