Media buying has evolved greatly in the last decade, with micromarketing receiving a lot of attention. But what exactly is micromarketing?
Investopedia.com defines this type of marketing as:
“A marketing strategy in which advertising efforts are focused on a small group of highly-targeted consumers. Micromarketing requires a company to narrowly define a particular audience by a particular characteristic, such as ZIP code or job title, and tailor campaigns for that particular segment. It can be a more expensive technique due to customization and lack of an economy of scale.”
It is true that micromarketing does involve segmenting your audience based on finely detailed demographics and/or psychographics, so that your message resonates better with these individuals who would purchase your product or use your service.
However, we’ve found that micromarketing isn’t necessarily more expensive. It may have a higher cost per thousand (CPM), but, with each dollar working much harder, you may be able to enjoy a lower out-of-pocket cost, or a higher frequency against your target.
On the flip side, traditional mass media such as network television may be a good fit for some marketers looking for broad reach, and/or high volume of response, or the targeted reach of an individual cable TV network or programming block. With a broader target audience, “waste” is limited, and casting a bigger net can be most cost-efficient, deliver results more quickly, and yield sales expanded beyond the core target.
Of course, as you read about micromarketing, you may be thinking the concept sounds at least vaguely familiar. That’s because not too long ago “niche marketing” was all the rage. Micromarketing is the logical evolution of niche marketing, utilizing today’s tools to target even smaller market segments.
To utilize micromarketing, you can turn to narrowly targeted traditional channels such as local radio, local TV programming, and local cable TV; addressable TV (delivering your ad only to homes where your specific target resides); community newspapers; or one of many specialized magazines. However, most of the buzz around micromarketing today is regarding digital channels. Millions of websites, blogs, emails, smartphones, and even our online social relationships are all accessible to the micromarketer. Need to reach a mom with 2+ children (under the age of 4) in Kansas City with a median annual income of $75K who’s also “green enthusiast” and frequents DIY websites? No problem! Prior to digital marketing, reaching her would likely have resulted in some amount of wasted time and resources.
Today, you can place display banners on environmental websites, demo-/interest-targeted Facebook newsfeed ads, or online video before infant/child product reviews—all while still geo/gender/age targeting. This allows you to deliver a very specific message through a one-to-one communication, instead of one-to-many.
While creating multiple executions of more-targeted advertising may mean higher production costs, that still doesn’t mean it’s more expensive overall. Remember: you are only purchasing your target audience—not a much larger group, most of whom won’t buy your product or service. This would save a significant amount of media dollars and create a much higher ROI.
Micromarketing isn’t limited to just media strategy either. Many companies are also finding success by more narrowly targeting their sales force, including the unnamed tech company mentioned in this Harvard Business Review article:
“…in recent months sales volume had plateaued…It [a leading chemicals and services company] diced its seven U.S. regions into 70 “micromarkets” and zeroed in on those with the greatest potential. It then pulled reps away from overserved territories, created sales “plays” for the newly identified hot spots, and redeployed the sales force. Within a year the sales growth rate doubled—without an increase in marketing or sales costs.”
However you’re thinking of utilizing it, if you’ve heard the buzz about micromarketing and would like to know more, just give us a call!