Many of you may have heard that markets across the globe are fracturing into ever finer segments. You may have also heard that this is been driven by the rise of social media.
But if people are getting together to discuss specific interests and this is leading to an emergence of ‘new markets’ to emerge then surely these interest groups must must have existed already. It just we didn’t know about them. So in this sense social media doesn’t ‘create’ new markets and market segments. It just identifies them.
The mountain of data that social media produces can now shine a light on who these people are, and what they like. And voila – we have new identifiable and serviceable markets.
Want to grow in this brave new world? Then learn to collect and read the data and then use the tools to communicate with them as they progress down the path towards making a purchasing decision.
All the tools are there and the people are waiting.
Best Buy may not always be thought of as trail-blazers but this video presented by their CMO shows how much they have embraced digital marketing and social media.
3 Wise Men – a successful New Zealand based business shirt label. Their slick Italian style designs, quality fabric and palatable prices combined with a decidedly cheeky tone of voice has made the brand a Kiwi businessman’s favourite. The famous “3 shirts for 3 hundy” offer has given them an almost cult-like status in the brands’ home country. With stores in Auckland, Wellington and Christchurch the next obvious step was for the cheerful 3 Wise Men to say g’day to the Australian market. A store in Sydney was opened – that’s where we came in.
The Solution
A heavily social media driven strategy was devised – with a cautious eye on budget to minimise risk for the new Australian venture. We started by creating a Facebook presence along with a Twitter account and began building followers. Then we went on to re-skin the 3 Wise Men home page to freshen up the look, improve navigation and the overall shopping experience to better suit the brand – without having to go through the expensive process of an e-commerce redevelopment. The site also had geo-location added to ensure users would be presented with information relevant to their location.
To create a soft-sell environment for the brand to live out it’s cheeky personality we created a separate social media web universe – “The Bored Room” was born. Built around a video blog this mini site allows users to view selected video clips, comment, share and connect with the brand. To aid in viral spread we built in a variety of social media tools. To drive return traffic, the Bored Room also features changing discount codes for visitors to use in the e-store – ultimately driving sales.
The popularity of the Bored Room spun into production of a 3 Wise Men viral video. We took the popular story of the Emperors New Clothes and gave it a new, slightly bizarre twist to suit the cheekiness of the brand.
Next out of the gate was a Christmas campaign to drive traffic to both on and off-line outlets. “Smells like Christmas” is an online version of an advent calendar. At the core of the campaign is the mini site featuring a new offer – available for 24 hours only – made available every day from the start of December to Christmas day. The campaign is supported by social media tools (Facebook and Twitter) as well as off line collateral, window decals and local promotional events.
3 Wise Men are an exciting and fun brand to work with and we can’t wait to let you know what we’ll do next…
As the southern hemisphere heads into summer and people flock to the beach it is tempting to think that the global financial crisis [GFC] was a just bump in the road. In some ways it was – at least for Australia. We seemed to have ducked the worst of the GFC. But that perception ignores the major changes that the GFC has produced. One of these changes concerns the way brands discover and talk to their markets. The GFC accelerated the rise of social networking and decline in popularity of mass media to produce a tectonic shift. This shift will have far reaching implications.
This new environment has enabled a quite different approach to growing markets and winning market share. Technology has both facilitated the “fracture” of markets into specialised interest groups and provided the wherewithal to identify and communicate with these groups – in real time. It’s time to get granular!
Stop guessing and start knowing
Not many companies have been able to turn the massive amounts of data that social networks create into profit. This is because they lack the ability or simply do not have the courage to make the steps necessary. In fact, the vast majority of companies have not managed to develop a management structure and marketing strategy that is in line with the fracturing of the market place they play in. Many are still guessing their way through mass media insights and market research based on small sample sizes extrapolated out to the entire population.
This will change very quickly in the coming months. As Hal Varian, the chief economist of Google, recently stated in the McKinsey Quarterly; “I keep saying the sexy job in the next ten years will be statisticians. People think I’m joking, but who would’ve guessed that computer engineers would’ve been the sexy job of the 1990s?”.*
Companies develop far better growth strategies if they choose to focus on granular information – in both identifying and attacking new market segments and in cutting costs.
The concept in practice
The Harvard Business Review recently explored the ramifications of exploring granular data. In that article they discussed how Amazon leverages it’s virtual and low cost supply chain to “efficiently indulge the tastes of narrow customer segments, literally down to the individual buyer, at very low marginal cost”.
The article went on to discuss how the strongest contribution to performance comes, not necessarily from focusing on acquiring overall market share, but identifying and investing in markets with the most vitality. The example they illustrated was that of a construction and services business face near zero growth. The company used granular data to divide its world into geographic, customer and product segments. They quickly discovered that they had very weak market share in the fastest growing market spaces revealing over $10 billion in potential that could be tapped into.
Steps to take
So here is what you need to do:
Accept that a fundamental change in communication is in place and be prepared to adapt.
Allocate budget towards methods and technologies that can gather relevant data.
Use this data to identify new market opportunities, the strongest growth areas will be apparent quickly.
Invest in these new segments and be prepared to ditch low growth market segments.
Develop a method for managing the multiple market segments you may now be playing in.
Life’s a beach
In the good times it’s easy to be complacent as customers come to you easily – like all of those people flocking to the beach this summer. But in the wintery phase the world economy is currently going through understanding the needs and wants of the micro-markets you can have most influence over is a winning strategy – that is easy to scale up when things begin to warm back up.
Now’s the time to get out your microscope and look carefully at the grains of data you have available to you.
