One of the most clichéd phrases regarding money is “Money doesn’t grow on trees.” It was something my father would say to me if I left the lights on, the fridge open or the front door ajar. He would even use it when I got a bad grade or a low conduct score on my report card. If I had to guess I’d say I’d heard it a million times before I turned 18. Looking back, I’m shocked it would take me another 10 years to pay for that lesson my dad was trying to give me for free. As retailers and small business owners, I think many of us have had the same experience.
How many times have you heard about big data, targeted marketing, or profiles? Now, how many times have you decided “I don’t need that yet.” or “I can wait a little longer for it to be tested.” I don’t blame you when it comes to investing in new technology retail is historically slower than their manufacturing and hospitality counterparts. That’s exactly why we’re going to discuss if it’s time for you to invest in branding or targeted marketing.
Money Doesn’t Grow on Trees
No matter how large or small a business is they all have one very real thing in common; a finite amount of money. Now I realize that corporations like Amazon, Walmart, Home Depot, and Chewy have access to a much larger bucket of money, but that bucket still has a bottom. If they didn’t, why wouldn’t all these companies also be known for how well, they pay their employees? If Doug McMillon, Walmart’s CEO, decided to squander all his marketing dollars on terrible investments, he likely wouldn’t have a job Monday morning. With all that in mind let’s talk about your store and whether you are investing wisely in your company’s branding or targeted marketing.
Imagine you have $10.00. Now you can save that $10.00 for a rainy day or you can invest that $10.00 and produce a higher return. This will allow you to make the same decision tomorrow but now you’ll have $20.00 instead. Now I know what you’re thinking, “Sign me up.” I don’t know many business owners that wouldn’t give me $10.00 today for a guaranteed $20.00 tomorrow.
I would never pretend to know how you should invest your time and money but I can give you data that may help you decide. We will come back to this later though so as long as you are ok with the concept we can jump to Terms.
Defining Branding and Targeted Marketing
I recently talked with Ian Binek, a Marketing Associate for NCR (National Retail Association) and asked if he had any ideas about Branding and Targeted Marketing. For those unfamiliar with NCR, it’s a 7 Billion dollar a year corporation that is number one in the entire world when it comes to transactions. They are also number one in Banking, Grocery, Self-Check-In, and a whole host of other things. Let’s look at what Ian said,
“Branding is your business’s image. Everything that you do and that your business embodies is what makes up your brand. On the other hand, targeted marketing can be a form of advertising that only a select group of potential customers may see. This gives you the flexibility to split-test and tries new things, without it affecting your overall image as heavily. Yes, your advertising and targeted marketing will still impact your brand but if your market segment is defined and your team has done enough market research, then showing a specific ad to specific people should end well on your behalf and not be a detriment to your brand.”
WOW, that is a ton of good & powerful information, so let’s break it down.
” Branding is your business’s image…Everything that you do an that your business embodies is what makes up your brand.”
Just these two lines could inspire entire collegiate level dissertations. My favorite way to discuss this with my clients is “How do you want your customers to think about your business when they do think of you? What really separates you from your competition? Really, dig deep and tell me about your business.” Later we will do a deep dive into TV, Radio, News Papers, etc. and their relation to branding but for now, I hope you understand how I view “Your Brand.”
“…targeted marketing can be a form of advertising that only a select group of potential customers may see.”
According to Merriam Webster’s Dictionary branding means the promoting of a product or service by identifying it with a particular company, product, or service. I was once taught that branding was the strategic actions taken to maintain loyalty after a sale.
I’ll give it to Ian, he really doesn’t pull his punches, this is once again a very packed tiny sentence. According to Marketing-Shools.org targeted marketing identifies an audience likely to buy services or products and promote those services or products to that audience. Once these key groups are recognized, companies develop marketing campaigns and specific products for those preferred market segments. Promotional messages and advertisements are sent to those primary groups instead of mass marketing without regard to the specific characteristics of the audience.
An Example
The best way to think about it is this. Let’s pretend you are at a local fair, and because you gave me $10.00 I just handed you a bow and arrow, with 2 extra arrows. The goal is to pop a single balloon and you win another $10.00. You can play as much or as little as you can afford. Now you have two choices:
Tent 1: This tent is filled halfway with regular helium balloons. You have no doubt that if your arrows hit a balloon it will pop.
Tent 2: This tent is full of all the way to the top of the tent with tougher leather balloons. More than likely a balloon may pop, but it will take at least 4 or 5 hits of your arrow.
So which tent would you initially choose, and remember since we are not the Amazons or Walmarts of the world we only have $10.00……… to start? If you chose to start at tent 1 than you’re a lot like me. I personally like to do my research, bide my time, and make sure an investment has a higher chance of success when my finite resources are low. I can always reinvest it later.
Join us next week for Part 2 of Small Business: Branding or Targeted Marketing when we discuss Targeted Marketing more in-depth and even review the wisdom of Pet Food Experts and their perspective on Why Email Marketing is a No-Brainer for Pet Retailers. as well as products like Customer Connect, Groupon, Cambridge Analytica, and Counterpoint.
Mark Nelms is a Business Development Manager for Pet Rewards POS. He has conducted over 400 interviews with retailers from almost every vertical and size. In prior roles, he’s assisted clients like Cumberland Packaging Corporation (Sweet N’ Low), The New England Patriots, and NCR (National Cash Register.)