Clearly Define User Groups
There are two kinds of user groups or market segments that are brand assets, high index users and high potential users. Certain user groups or market segments contain more significance and impact than others. Learn to distinguish high potential users from high index users, that is the 10 percent of your customers who buy 60 percent of your products as opposed to merely high potential. You want to intimately know and cultivate relationships with both.
Distinguishing with clarity is important for communication and it is crucial for longevity. Many new businesses flounder in this regard and try to mass market but this saps potential growth.
Crafters are high index users of the products offered at Espresso Press. Many create and sell physical products using kits. Kits help them save time and money when producing their finished products. If a kit is designed with these users and their buyers in mind, every item in the kit gets used. Knowing these users intimately by understanding their needs helps me create products that will help their online business flourish. Researching this user group also saves me time and allows me to clearly establish and strengthen market segments. Many times this means hands on production to ensure my products meet the consumer quality standards of crafters that in turn sell handmade paper products like journals to their customers. Having a background in print production helps but by forming relationships and doing careful research on what they are creating and how helps me to design well made kits for them.
Many times crafters become designers and move on to creating their own digital products or other merchandise. Merchandise creation is a broad market that has exploded in recent years with many avenues of opportunity. Creating products that facilitate merchandise creation makes this group high potential users. Having a large range of designer kits with carefully curated elements for merchandise creation enables me to pursue and nurture this growing market segment. These products are created with professional designers in mind with a lot of tedious work already completed and my sales of these products often go to designers in their own niche markets whether it be invitations and paper products or apparel and other merchandise.
Pursuing High Potential Users
People with developing or changeable brand loyalties are important. This often translates in to pursuit of the young in hopes of procuring long term brand loyalty. If it works and when it works it can translate in to brand loyalty for decades. Car makers and beer makers know the value of a lifetime customer. Out of 100 people loyal to a beer brand at age 21, 50 will still be loyal to that brand at age 30. Car makers also know the value of nurturing the younger market and continue to fine tune their products to meet their needs. Honda and Subaru do this exceptionally well.
Pursuit of the young is not the only valuable market segment to cultivate. What demographics in your market segment or user groups are worthy of nurturing to cultivate acquisition and help build brand loyalty? Predicting what they are likely to want or need in the future is worthy of intense market research.
Narrow Appeal Means Narrowing Markets
Niche marketing is popular but narrow appeal can have risks including watching your market segment disappear over time. Users may age out of your product and market forces or competition can wipe out whole market segments seemingly in an instant.
Mass markets are mostly a myth but understanding your user groups is key to rejuvenating a disappearing market niche. Coffee is one example of a product that has been rejuvenated and reinvented many times for new generations by carefully researching user groups and capitalizing on these high potential new consumers. As a result coffee sales have skyrocketed to new heights instead of remaining a stale product with narrow appeal.
Knowing your user groups intimately takes time, dedication and research. Seek to build solid relationships with user groups and how to best serve their needs and you will cultivate both market segments and build long term brand loyalty.
What steps can you take to get to know and form long term relationships with both high index and high potential user groups?
Give yourself a high score for having done the research necessary for thoughtful development of this high value brand asset.
Broadening a category within high index users helps me develop products that stay current if sales within a segment suddenly become less popular. Being aware of user trends and seeking to re-capture appeal is important for product line development in both high index and high potential user groups. Planner accessories has crossover appeal among those who are already familiar with journal kits.
Creating different products in terms of scale also helps me attract new users in both groups. Creating a try before you buy or other low effort level products helps me test market to high potential users. I also personally stick with the 80/20 rule and carefully track and quantify results of user group interactions with various tools.