Unlike tomato soup, which looks and tastes the same from one side of the bowl to the other, your company’s profitability is not a uniform thing across all your markets. It likely looks very different from one city to the next, from one zip code to another.
Yet so many businesses look at profitability—and subsequently their marketing efforts—like tomato soup. It’s standard for businesses, especially large ones, to think about their financial health in terms of regions, or even countries.
But the marketer needs to think more granularly in order to understand where the biggest opportunities are. Instead of one approach, deployed uniformly across markets, efforts should vary depending on market potential and makeup.
Because profitability is more like chicken soup, with pieces of chicken here, carrots there, and a lot of clear broth in between. You don’t want to spend as much effort chasing the clear broth as you do the juicy chicken.
So if there’s one thing I would challenge business stakeholders to do, it’s to map your profit density by zip code. Why are you selling one per every 1,000 people in Dallas vs one per every 50,000 in San Francisco? Take a look at where else you’re selling. What makes the people in those markets different? The objective is to discover your carrots—the most profitable customers—so you can determine how to reach more of them. (This also works in terms of discovering whether some customers are worth chasing at all).
One you’ve established such a framework for your marketing efforts—a process that requires looking closely at your CRM and sales data side-by-side—then you have to figure out execution. How do you put the “chicken soup” framework in place so that you can scale how your message reaches customers at the level of granularity that such an approach requires?
“Carrots” can only be identified online. But the good thing is—once you’ve identified what your customers look like, and where they tend to live—reaching them in the digital channel is possible, and highly effective. Here are the key takeaways for implementing a “chicken soup” strategy:
- Profitability is local. Map your profit potential to areas with the highest potential sales density, and build a framework.
- Identify your best potential customers and the specific areas they live in.
- Once you determine the “lookalike” audience and geo targets that map to your profitability framework, create a stack-ranked execution plan based on your highest potential profit areas
- Leverage digital media to achieve granularity in targeting, but spend liberally to achieve branding effect. Potential customers cannot convert without awareness.
To most marketers, the addressable digital world looks like a big pot of tomato soup. The marketers that understand that their market looks more like chicken soup—and have the right ladle—will ultimately be the most satisfied at the end of the meal!
Christopher Skinner is a frequent speaker at Google conferences and other digital industry events. He founded MakeBuzz in 2001 and has worked with over 250 leading companies, including Vodafone, Target, United Airlines and Oreck. Look for Christopher’s column on The Makegood every month.