Well now we're ready to get going. And one of the first things I find is that in my Northwestern class, many of the students want to jump right into social monitoring, to begin to figure out what their target market is. And naturally they're wrong way to go. We're going to get to social marketing, but we're going to do it in the next step of the process. For this first process, what I want you to do is to define your target markets using what's called secondary research. Now, what is secondary research? It's basically reports and information, and intelligence that other companies have gathered on the industry you want to target, the competitors you're going to be in the marketplace against and the markets that you're going after. These things are relatively easy to collect and they often times give you very very valuable incite as to your target markets and the characteristics that you could use to be a success. And so the way I like to describe it for my students at Northwestern is I say, just breathe it in, grow and read a lot of things, talk to people, learn about your target market. Listen to what they're saying if you have customers that are in that target market, and essentially gather as much intelligence before you go over to social. Because once you do that you could really refine your social strategy and make really great social programs. So how do we get started? The first step we want to do is we want to achieve three things. We first want to define and quantify your target market. Now, that's two very different things. The first thing we want to do is to define it and by define it, describe it in terms of demography, in terms of lifestyle, in terms of location and other sorts of characteristics that allow me to kind of close my eyes and picture the exact market that you want to go after. And there's a matter whether it's a business to business or a business to consumer market is being able to really see it and define it in ways that makes it more tangible. The second thing we want you to do is to quantify it. In other words, are we talking about a 10,000 potential business to business target market with a lot of value to it or are we talking about a 10 million person consumer market? The size of it really does matter, and it helps you get an idea of how big it is. So that as we're building out our marketing plan and justifying the program, we can put it in the context of here's how big it is. The next thing we want to do is to determine the value of a new customer. By new customer, I mean if they purchase the first time from you, how much would that be or better yet, if they purchase over the course of a year, how much would that be? Now you may be saying, and a lot of times my students run into this, they say well, the client really doesn't know what the one year value is, and they're not really sure about what that first purchase amount is. Here's how to get around that. For this study, just plug in a number that you think is close. Is it closer if you use dollars, you get closer to $100 or $50 or $10. The key is just we're going to use the same number consistently through the process and then let's say, you said that it was $50. But it turns out to be 60 or it turns out to be 45, we could just make one time adjustment across the entire program to recalculate the numbers. So the key is to get a number that doesn't stop your whole process, that is close enough that it seems reasonable and that you can move forward. So I'm going to talk to you a little bit later here in this video as you're talking to experts out there, you can ask them, what is the amount of money your revenue that a person in this target market would generate? If you don't have it maybe they do, so we use a lot of different ways to try to get that. The final thing we'll do is we'll calculate the value of your target market. Now you may be saying, why would I want to do that? That's very, very important part of the process. Let's say that we had a 1 million people consumer market. So it's 1 million people and if they had all bought from us, which would be great, that's never going to happen, they all pay $10. That means it's a $10 million market, and the reason you want to calculate that is, that when you go up in front of senior management or you're trying to justify it to your angel investors, let's say your start up. It really helps to say, you know what? I want to have a program here that's going to cost $50,000, that's going to have positive ROI, but it's going to be going into a market that has a cap of $10 million. Suddenly that $50,000 expenditure is not so big it gets 10 million. And they begin to say well, if that works and when that works, then we can invest more money above 50,000, and to begin to reap the benefits of the $10 million potential market. And so you want to calculate it, just to give yourself an idea of the size because not only is that important for you to justify it to senior management, it's the way your competitors are looking at that market as well. So you really want to calculate it. So let's get into how we're going to do this? The first thing we want to do is to define your target market, any market you want we just need to get some definition to it and some quantities about it. So let's talk about how we can do that? The first step you want to do is to look out and do a search. Usually, I like to use the Internet, but you can also go to a library if you don't have Internet really available, but the Internet's better. And what you want to do is look for published reports on the industry you're targeting often time these reports are going to talk about here's the competitive structure. Some of them will just be talking about the general trends of that market place. Some will be getting into different markets and what's happening there. Some might be looking at new products and new technologies that are going to impact it. What you want to do is to look for published reports that on the markets you want to target and get as many of them as you can. A lot of these reports are published for specific countries or specific regions, and so if you're targeting them try to find those kind of reports. One thing I would caution you is don't buy them, unless you want to invest in a $5,000 report. There are a lot of free resources there on every market for you to use. Start with free, and I also have some other tips beyond just these published resources, that you can use to get this first step done really well. Take a look at this. What I did is I went out to Google and I typed in size of the fashion industry. When you say size it brings back a lot of reports, and so if you are doing a survey these are a whole bunch of statistic analyses of the nature of the fashion industry, the apparel market. You'll notice the third one is in the US, the other one is more international. The key is you can go and find all sorts of different levels. Most of these are free and the ones that even pay oftentimes have a fairly nice synopsis of what their study revealed, and so go and look at those. And don't just look at printed stuff, there's also things that are online on YouTube and other sorts of video channels. But go out and look for size of the industry, characteristics of the industry, things like that. Global fashion as you see was really important, that would probably yield a whole bunch of things. So what you want to do is put together different terms, spend some time looking. These are free resources. If you're starting up a business, use free resources to your best advantage to gain competitive advantage in the marketplace. The other thing is ask the experts. You have a list of influencers or you probably will very quickly. Go talk to them, but also talk to local experts or local business owners that are in the same market or are dealing with the same target market, and also use your online network. In other words, use every resource at your disposal to get a good idea of the target market, what value it is, how it works, and a little bit about what the competition is positioning itself as. The other thing you can do and this is really useful, especially in the United States and Canada, but there are others ones around the world and I'll show you that here in a minute. And so look for what are called compiled databases. In other words, there are companies in this case infoUSA, that have compiled databases of every household in the United States and every business in the United States. They don't have everyone, but they have about 95% which is enough for me. And what they do is they want to sell you lists, email lists, direct mail lists, and so forth. And they way that they do that is that they give you free access to their account databases. So what you do is when you go to infoUSA for example, if you're targeting a US market, and they also have a Canadian one, the first thing you do is on the green bars there you say, is it a business market you want or is it a consumer market you want? And it works both ways, when you click on it in this case, I clicked on the consumer market, what it does is over here on the left it says, okay we can give you households counts of any market you want. We have our broad array of demographics and descriptive, and regional data. And so what you do is you click on the green bar that is there on the right and it says, let's get started. It then takes you to the screen that you see on the right and as you see here there's business demographics or not business demographics. There's household demographics, there you can talk about the regions you want, you can get it down to city or state, you can also say here's a lifestyle we want the households to have. Do I want to have a home that is single person or a couple, or couple with children? You can break it down any way you want, and if you'd go through it and you go through in at each piece of the criteria that you want to define. Over on the far right-hand side of the right-hand screen, you see it starts with the total number of households in the country, and it just keeps counting down until it gets down to the target market you want. The nice part is you can save these reports and actually output them, which is very useful for a presentation, but also you can get the counts. Now the only thing you don't want to do is don't go to the last step of order the list and actually put in your credit card number. Do that when you actually execute a campaign. What you're doing here is you're just gathering intelligence, getting counts, and so there are a lot of these compiled databases. Look for rental lists, email lists, email marketing, things like that. Will get you to these compiled companies. For example, just to illustrate it, I wanted to get marketing lists for India. Well here's a whole list of them, and I can go up to, some of them will be for a fee, and I'm not going to mess with those, other ones are going to be free, I will use those to best advantage to get the counts I want. And there are going to be both business to business lists and business to consumer list, and so you're going to need to pick the one that's going to be right for you. But all you're doing and all you're doing through this process is gathering the count you're going to need and the insight you need to begin to identify the target market, and really understand who they are and be able to picture them to help you build you social marketing program. The deliverables we want some step one is to write a description of the target market from your research in other words I want you talk a little bit about who they are, so the other people say future employees or your business partnership you have or your sea level suite can understand what you're going after. What is the size and description of the industry? Is it growing? Is it shrinking? What is the size and description of the target markets you want to go after? Who are the competitors in these target markets? Were there interesting findings that you had? Aha moments if you will say that's really interesting that will be useful to know. Save all those. Another thing that's really, really useful here, is to get a few great pictures of your target market. If you're defining a household that has two children and they got a dog, and da, da, da, whatever those things are, go and get a picture that looks exactly like that. Because when you're showing senior management, the picture really reinforces your descriptions, and what I'll tell you is people don't have time to read the descriptions, but they'll remember the picture. Also describe the target market in terms of the area you want to impact. Are we talking about a global marketing program, a national one, a regional one, a local one say in my case is it the city of Chicago? Is it hyperlocal like the gold coast of Chicago? The key is where are you trying to target will really help you because it's going to help you define the size of the market. Finally, what did you learn about the competition in your target market. One of the most important things is are they targeting them? Are they targeting them through social? Are they doing it through mail or email? Does their website refer to this target market? Do they have pictures of the exact people that you're trying to get? Use all of your resources to learn what your competition is doing, and whether they're targeting them or not. Also, how are they targeting them? Are they offering the same products and services you are or are they offering something different? Those insights are really, really important. So as I keep saying to my students, just drink it in, take in as much intelligence as you can. The more you have, the better off you're going to be when you start building your social marketing strategy. The next thing I want you to do is determine the value of a new customer. As we discussed earlier, what we want to do is we want to identify the amount of revenue. We don't have to do profits yet, just the amount of revenue that they would bring in during the course of a year or if it not a year at least the first purchase and there are several ways you could do it. You might have experience with this so you say, I know exactly what that number is because I've been dealing with these type of market in my business. You might also when you're doing your secondary research. You might find industry averages that say on average this is about how much you spend in a year. Those are very useful especially if you don't have the experience to get a firm number, but if all else fails use your best guess. One of the things you don't want to do is what's call paralysis by analysis. In other words, I don't want you to spend so much time analyzing to get a single number that you waste weeks of time. Take a best guess. You could always go back and change it. You can even change it after the capstone is done. It won't really matter to us whether it's $60 or $50, so don't make it matter to you right now. Get the best number you can either through experience, through your industry average or your best guess, and capture that information so we can use it as we move forward. The final thing we want to do is determine the total market value and that's really easy. What you want to take is the value of a new customer that you just developed times the total number of people in that target market, that gives you the total value of the market. So again if it's $10, a million people, it's 10 million. If it's $10 and 10 million people, it's a 100 million. The key is it doesn't matter how big that top number is, what you want to do is to establish that number so that you can use it in your presentation to say to senior management or to your angel investor or to yourself, here's how big it is. Because how big it is is how you're looking at it, and it's how big your competitors are seeing it as well. And so you need to know that it's very useful to have. And so while it's important to do it the impact is huge. Again, what it does it give senior management something to do. We'll also use these calculations this valuation calculation we're going to use that throughout our performance funnel. In other words what I want to do is actually have it so it says this is $10 million market, then here's how big the social market is and it's value. Here's how many are going to be for example, getting a landing page and it's value. And then we're going to to take it all the way down, so we'll be able to see the dollars as well as the numbers, as well as the percentages flowing all the way down through the performance funnel. And remember if you don't know, take your best guess. We can always change it. So in terms of deliverables, make it the top of your performance funnel now by capturing the total size of your target market and the total value. And develop your descriptions of your target market and your competition. And then identify any industry, competitor or other trends which are important. The more you can gather, it doesn't have to be like a 20 page report, it could be 3 or 4 really good slides in PowerPoint or something like that. And it doesn't have to be huge, it just has to be really poignant to you. And one of the things I like to do is to make a three ring binder or something like that, and keep all of the reports that I print out. So that I have them for future reference or kind of like the appendix to the program, but the more you can take in at this point the better. So let's get started by doing some secondary research and really understanding the size, the description and the value of the high value market that you want to develop.
