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Know Your Customer: Who Is Your Customer?

The US Census Bureau will release the results of the monumental 2010 census sometime this year, and marketers should prepare for some stunning demographic shifts.

The Average American has “left the building.” Fifty years ago, the theory of John Q. Public, an average American in a relatively indistinguishable society where vast numbers of people had similar needs, was a reality. But, the collective uniformity that once existed has been replaced by a new paradigm.

We are a multicultural nation. In the nation’s two largest states—California and Texas—no single race or ethnicity accounts for a majority of the population anymore. In fact, no segment forms a majority in America’s 10 largest cities.

Family life is diversifying. Twenty-five years ago, two-thirds of all households consisted of married couples. The 2010 census will show that for the first time in American history, married couples will be a minority in the US. The number of people living alone is growing rapidly.

We are a multigenerational society. With more people living longer than in previous generations, there are greater numbers of multigenerational households. That means older people (age 60+) are living with their children or grandchildren and have a bigger impact on what those young people are buying.

The implications for marketing are clear: One-size-fits-all messaging will prove ineffective. It will appear totally irrelevant, especially if employed in email and social media marketing—vehicles in which instantaneous feedback is commonplace.

A new attitude must be adopted for email, mobile, and social marketing programs.

Segmentation is indispensable

Database development and management must facilitate segmenting by key demographic criteria, such as age, gender, location, household composition, marital/family status, and ethnicity.

By not targeting each segment specifically, it becomes impossible to make timely offers to each and reap the rewards of relevant, engaging, and useful messaging.

Identify and communicate with influencers

There is no direct pathway between brands and buyers—influencers play a vital role — more so today than ever before. Social networking makes sharing group opinions and feedback easier and more extensive. Influencers are not limited to immediate family and friends. Total strangers have become trusted, credible sources of information that influence purchase decisions—positively or negatively—thanks to social networking.

Communicate not only with your target audience, remember to include the influencers in your messaging.

It makes more sense to ask than to assume

In the past, profiling and clustering programs have made predictions and assumptions that classify customers and prospects into groups for marketing segmentation. Demographic and marketing data is used to categorize customers or prospects into distinct groups that supposedly share a lifestyle or behavioral profile.

Thanks to the dramatic changes in the population, these segmentation methods suffer from two limitations:

• A population that becomes more diverse, demands more and smaller cluster categories. In many cases the groups are too small to economically address individually.
• Multicultural citizens frequently fall into more than one cluster, sometimes apparently contradictory ones.

The solution is to utilize online surveys frequently, continually asking members what they like, dislike, need, want, fear, plan for, etc.

Then track and analyze their responses to confirm their recorded opinions and intentions. This will allow you to model future marketing strategies on what your target audience has responded to in the past.

Uncover the opportunity to connect

Due to the radically shifting demographic landscape, you may be operating under assumptions about your customers that are out-of-date and untrue. Your customers are a decidedly more diverse group than you expected.

It is a realistic idea to revisit your segmentation methods and reassign individuals to new segments as their behaviors—or demographics (e.g., age, net worth, political affiliations)—change.

Regularly fine-tuning the way you group customers into segments will allow you to create marketing that resonates, engages, and maximizes response.

Marketing to the “average” consumer is misuse of resources. Find out who your customers really are, and spend the time and resources needed to connect with them individually.

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