The Importance of Defining Your Target Market

The Importance of Defining Your Target Market

by Commonwealth Financial Network

You connect with clients and prospects all the time, whether it’s to e-mail invitations for events and activities or to share interesting or informative content. But have you considered using what you know about them to send messages more tailored to their interests? Ever think how that might improve the chances they’ll engage with what you send them or even recommend you to a friend? 

Defining your target market gives you the opportunity to better understand the needs of your existing and prospective clients. Once you determine your particular audience, it will be easier for you to refine your marketing approach, thus providing content and services that resonate with your audience’s interests and needs and ultimately strengthening your relationships with them. 

What follows is a brainstorming exercise you can use when defining your target market. 

At a minimum, ask yourself the following questions: 

  • Who is most likely to use your services?
  • Retirees, families, business owners?
  • Women or men?
  • What age?
  • Married, divorced?
  • Do they have children? If so, how old?
  • What is the average income level?
  • Where do they live? What do you know about that area?
  • What are their hobbies and interests?
  • How do they like to receive their information and by what sources?
  • Who do they trust already?
  • What type of content works best for them?
  • What else do you already know about them?
  • How do most clients find out about your company? 

One of the most important principles of marketing is to know your audience inside and out—especially their emotions. Thinking from your audience’s perspective allows you to connect with their needs or desires. Once you accomplish that, you’ll be able to send them marketing collateral that they are more likely to open and connect with, leading to a more meaningful business relationship. It’ll be easier for you to select what to send them, narrowing your marketing approach to make you much more efficient. How do you figure out what means the most to your audience? Ask yourself these questions: 

  • What are your audience’s biggest financial concerns?
  • What are the top five questions they have about their financial future?
  • What are their most important financial goals?
  • What are they passionate about? 

When you have all this written down, you have a goldmine of information to help you better connect with your market—not as individuals, but as a group.

Use your CRM system to capture as much of this information as possible. This way, the data is at your fingertips and the information can be sorted to help communicate effectively with your audience. Once you have this information available at the prospect and client level, consider dividing subjects into groups based on the different criteria you’ve selected. At Commonwealth, a function within our Practice360°® platform—which is conveniently integrated with our CRM system—allows advisors to arrange both static and dynamic groups of individuals. Static groups are what you’d imagine—they don’t change unless you take action. Dynamic groups, on the other hand, will adjust automatically over time, even capturing new individuals as a data point changes (such as net worth or a portfolio holding). Additional features within the system allow for easy communication with these predefined groups.

Once your data has been gathered and sorted into target audiences or groups, you are ready to act based on what you know about these clients and prospects. 

For example, perhaps you found that a significant number of your clients age 60 or older like to receive communications by e-mail and are interested in volunteer activities. If one of these clients supports a charity, you could donate in his or her name or send an e-mail inviting that client and others to join you at a fundraiser. 

Or, maybe another one of your target audiences is millennials in your city interested in experiential travel. You might decide to invite 10 of your millennial contacts to a culinary class with an exotic menu. If you don’t know what experiences your millennials are interested in, just ask—they will be happy to tell you. 

These practices will show you that you know more about your target audience than you realize. It’s time to develop and execute authentic marketing initiatives that will resonate with their interests or needs. Remember, it’s not a one-size-fits-all world, and narrowing your marketing scope can help you to become more efficient and productive when working to connect with clients and prospects. By defining your target market, learning more about their interests, and tailoring your deliverables based on your findings, you strengthen your existing relationships and open your firm to the opportunity for new client acquisition. 

What methods do you use when defining your target market? What helps you categorize your clients? Please share any tips and tricks below!

5 Steps to an Effective Marketing Plan

 Commonwealth Financial Network is the nation’s largest privately held independent broker/dealer-RIA. This post originally appeared on Commonwealth Independent Advisor, the firm’s corporate blog.

Copyright © Commonwealth Financial Network

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