668: Business Insights: Identify the Right Market, Set Goals, Solve Problems, and Help People with Business Plan Answer Man David Brown
David L. Brown covers Business Planning Strategy in this Marketer of the Day episode. Strong businesses start by identifying the right market, solving a specific problem, and building the plan around the people most likely to buy. David L. Brown begins by asking what problem a product or service solves and who actually has that problem. He recommends narrowing the market using factors such as age, income, education, home ownership, family status, hobbies, and geographic location. One cat-only veterinary practice identified roughly 1,000 qualified households within five miles and about 678,000 within a 20-mile radius. Targeted postcard campaigns helped that practice exceed its three-year goals within its first year. Brown also recommends testing messages in smaller batches, studying existing customers, monitoring changing neighborhoods, and continually refining the customer profile.
David Brown is the "Business Plan Answer Man" and the founder of BusinessPlanAnswerMan.com. He has over 30 years of experience in business and has appeared on the Marketer of the Day podcast before, discussing topics like strategy, entrepreneurship, and focus. Today, David shares insights on the importance of identifying the right target market for your business, rather than trying to appeal to everyone.
Quotes
“Starting a business for the wrong reason is the number one reason businesses fail.” - David Brown
“When we niche down, you have a narrower focus. Instead of fishing with a dip net trying to catch just perch, you can target with a specific bait on your line, going out to catch just the perch.” - David Brown
“Markets shift neighborhoods. Some go down, become rundown and unkempt, while new ones come in. You have to always be cognizant of what's going on in your marketplace.” - David Brown
Takeaways
01:10 Targeting everyone as a customer is a mistake, as it leads to spreading yourself thin and not charging the right value.
03:22 Identifying the problem your product or service solves and who has that problem is crucial for effective marketing and business growth.
11:35 Niching down and targeting a specific customer profile can lead to much better results than trying to appeal to a broad market.
18:14 Ongoing evaluation of your target market and customer base is important, as markets and neighborhoods can change over time.
19:53 Gathering testimonials and referrals is a powerful way to build your business through referral marketing.
Resources
- Previous Appearances
- DAVID L. BROWN BUSINESS PLAN ANSWER MAN: Unlock the Potential for Your Success with My Transformational Business Planning Approach
- Connect with David Brown on LinkedIn
- Send a message to David through his Email: Dave@BusinessPlanAnswerMan.com
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Transcript
Download transcript (.txt)Marketer of the day. Episode 668, Business Insights, identify the right market, set goals, solve problems and help people with business plan answer. Man David Brown,
we are back with return guest, Mr. David Brown, and you can find his past appearances at marketer of the day.com forward slash 497, where he discussed the strategy you should and need to have to hit your goals. You can also find him at marketer of the day.com/
609,
where David touches on entrepreneurship and focus. And he's here today to tell you that everyone is not your customer. If you're targeting everyone, what does that mean? It means that you're going to be spreading yourself thin. You won't be charging what you're worth. It won't be easy for people to know what you do. And that's a really harsh wake up call that might be hitting you that if I go to your website, is it clear that I know what it is that you do and you should be in the business of solving problems. And if you know what problem you solve, then the rest of the steps begin to take shape, right? If you know what problem you solve, then you know who you should be solving that problem for, and you know how to contact them, and then you can begin to set goals as far as getting traffic, or doing the reach out, doing the lead generation, doing the follow up. And David is a very smart guy. His website is business plan answer man.com, and he's going to be sharing with you some fun stories of mistakes people have made, but also people's he's helped, and questions you can and should be asking yourself to make sure you're on the right track. So David, glad to be talking to you and welcome back to the show. Robert, I want to thank you for having me back on your program again. It's always an honor and a pleasure to have a chance to
visit with you and your listeners, to give them some insight or whatever, and across through in the business planning world,
it's much appreciated.
I'm Dave Brown, the business plan Answer Man,
and as I work with my clients and prospective clients, we get into some pretty good discussions before we even start the business planning process. It's all about gaining some insight as far as what they want to do, and I like to start off on a call, or depends on location, sometimes even a face to face,
and just learn about them as a person. What motivates them? Why do they want to start a business? Is it the right reason?
As I dig into things, one of the things I have learned is that 80% of the businesses fail within the first five years of that remaining percentage, 80%
will fail between of that number will fail between year six and 10. Those are pretty alarming statistics,
and a lot of it boils down to why they started the business. Starting it for the wrong reason is the number one reason businesses fail. And
there are many other issues that do that, lack of knowledge and how to run a business, lack of financial commitment, lack of time commitment. The list goes on and on of why businesses fail. But one of the things that I found out in talking to people is when they start to look at their potential new business
as we've looked at their product or service, they haven't done the research is, is this a viable market out there for that.
And I'll ask them, what
problem does your product or service solve,
and who has that problem that you need to solve?
Some will have a good idea. Some I get to deer in the headlights. Look
what it boils down to, why
am I going to put this on the market? Is it the right product at the right time for the right problem?
We get into that discussion quite a bit, and then we start taking tapering it down, once we figure out the grand big picture of what this product or service is, is the market big enough to withstand that as a full time business?
What do I mean by that? It might be something that it's crash Well, it's hard to support a full time business with just crafts. You might may be better off maintaining a side hustle, doing some weekend workout in your garage, or taking to a craft show here or there, and doing that
that's an acceptable business, then you might find something that will expand that well, if I do this, I could do some custom work for so and so, and do this, which ties into.
That.
So we have to look at the big picture, and is there a different type of issue that we can solve by utilizing your skill set, your products, your services.
Then we start talking about where we're going to find these people. What do they look like?
So many people
haven't thought that through.
For instance, I work predominantly with a group called encore entrepreneurs.
Why? Well, they're people like myself. I can relate to them. We've left corporate employment for one reason or another
and decided to start a business. Well, two reasons when to do that. You know, we're too young to retire, as much as I'd like to sit back, prop my feet up, play a little golf, it's not in me to do that. One and two, I got a long way till I feel I'm ready to retire.
I want to be able to go out and do what I want to do, enjoy what I want to do
as an encore entrepreneur, and help people using my skill set. There are a lot of people out through there that need help but don't know where to turn.
As a consultant and a business owner, with all my experience, I can help them
that does more for me, sometimes than the money. Yeah, money's nice, don't get me wrong, but I have a history in my mission in life is to help people, and it's been that way throughout my life.
But what are you doing is, how does your vision and core values line up with what you want to do?
So we talk a little bit about that, and then we start breaking down that ideal customer. They look like, single, married,
highly educated, high school graduate.
We start piecing all these pieces together. We look at it, we just start making a list. The more we can niche down that market, the better off they are. They don't realize everybody thinks that everybody's their business, and that's a common thought. I used to think that years ago, till it almost put me out of the insurance business because I was trying to be everything to everybody.
Then I was instructed to focus down, and I started working with some business coaches, and as we brought that down to a very small I could pinpoint where I'm spending my money.
We have to get entrepreneurs and business owners to that mindset.
When we niche down,
you have a narrower focus. So instead of going out there and fishing with a dip net, trying to catch just perch,
you can bring it down to targeting with a certain bait on your manure, worm on your line, to go out there and catch just the perch. You can target them by what you're using in the same way as in your marketing, if we target people based on their need for our product or service,
we're going to have much better results. We're going to see more money coming in for what we're spending. We're going to feel better about what we do.
They're going to be happy because we've solved their problem,
and in turn, you know, life goes on, we have a happier life because we've been able to fulfill all of this by doing some work up front.
I'm very passionate, as you can tell, about making sure people have the right market, because I've lived through the experience of not having the right market.
But what I want to do is we want to narrow that down a little more, right? Let's start looking at this. Is there a
family involved? What's their income level?
Do they own a home? Do they have certain hobbies?
Whatever it is that your business is focused on? We want to keep narrowing that down.
One of my earlier clients was a veterinary practice.
She was cat only.
I sat down with her, we had this discussion. We started looking at because she had prior experience working in this type of setting. In another city, we were able to easily identify her target market. One they had to have a cat being a cat only practice.
I know it sounds silly, but it's one of the things that we looked at.
The other thing is, what type of people spent money at the vets on their cat? It's
people with a little bit higher income levels. They owned a home most generally, their homes were
anywhere from 175,000
or above. Their income levels were probably 50, 60,000 and above,
they subscribed to mail order and.
They did mail order ordering. They had magazine subscriptions in this in the animal world, some of them may have a Cat Fancy magazine or something like that. We identified several key components of what her ideal customer looked like.
So I took that list, and I went out to my brokers, and I said, Okay, what kind of numbers can you give me based on all this criteria.
And we started it because she was opening a new practice. She had a brick and mortar location. So he said, Give me a five mile radius around her address.
We did that in a five mile radius, we came back with 1000 households, not people, households that met her criteria,
pretty powerful, isn't it? All of a sudden, you got this list of people that fit those that will spend money on their cat, and you've got a list of them right here in front
of you. We did put together some mailings and some contact pieces for her to start working on that. And I said, Well, just for grins and giggles, let's kick that out. 20 miles, I want to see what this bigger picture will be.
It's not uncommon for somebody to drive, you know, 1520, miles or even longer, to go see a professional. How close are you to your doctors, lawyers, other medical providers?
They're not. Some of them aren't in our neighborhood. We drive a little bit, so it's not uncommon to see people drive to that level.
When we put that into to the system for the with the broker, we came up with a number, something like 678, 1000 households within a 20 mile radius that fit her criteria.
And she about fell out of the chair, actually, so did I, because I didn't think that number would be that large.
And this is the beauty of targeting that so we targeted people with cats, why go out and spend money to market to people that have no animals or dogs when you're a cat only practice by doing this, we were able to focus that in and she exceeded her three year goals and objectives within her first year In business. I
don't know about you, but I'd like to do that myself.
This was pretty amazing. And then we did it in a drip marketing we started out small, tested some pieces, see what the return was, and then we just kept expanding that. Once we got the right message out on the mailers, this one was postcards. Hey, we're new in your neighborhood, where cat only practice, stop in and see us. Blah, blah, blah, blah. Had a little picture of where her of her building in her location,
and people were coming in carrying the postcards. I was just amazing when we did our follow up, that the
return on her investment was pretty substantial. She was kind of private in the numbers, but she did tell me that she exceeded her goals, or three year goals in her first year.
And that's the beauty when we start narrowing this down. So I'm very passionate about finding the right market, the right people, the right market, in the right location, then we target them with the right message, and then your market can skyrocket.
What are you doing in this realm? If you're an existing business, go back and look at your customer base. What kind of information do you have on
start building that and identify these people. It may take you a little time to find out their geographic location. What commonalities do they have? You know by your customers, okay. Are they in?
Yeah, early 20s, 30s, 40s, 60s, 70s. You can get a pretty good idea, and then look at all these other factors that we talk about that make a key decision on your product or service.
It's an amazing piece when you start looking at this. The first time I did that in my insurance practice, I was actually shocked to find out
where my ideal customer range was,
because I
had never done this, and then when I learned about this, I sat down with my staff and heard I
went through and looked at these people are coming from this area. We did it started by zip code. We just started breaking it down by zip code. And then we went by municipalities, and then tried to focus that way. So we spent some time doing it, and notes all over my whiteboard, but I could target those people with a specific product or service that we offered within the insurance realm.
You've got some upper income people. We start talking estate planning.
We had small families.
Late, people with families and small kids. We start talking life insurance. There's a lot of different pieces that you can do. Once you know the demographics of your customer base,
spend the time breaking this down, you won't regret the time you spend, because it's going to be profitable for you in the long run.
And Kennedy, one of the famous copywriters, and just amazing gentlemen, I study his material, and he tells a story about a carpet cleaner.
He wanted to go and expand it to a new area, trying to build his business. So he did his research,
put out his mailing,
and was getting no return, and he couldn't figure it out. And he happened to be talking with Dan one day. This was a friend of Dan's,
and he says, you know, was telling him about the issue.
And he said, have you checked out the neighborhood?
So being as, it wasn't too far away, they took a ride. They drove the neighborhood he was mailing to. What did they find was not what they expected.
Houses value lower hundreds, if that cars on blocks, yards on kept
just general lack of maintenance. This was the type of people that more than likely would not hire a professional carpet cleaner. They go down the hardware store and run a carpet cleaner and do it themselves.
So on the way back to the carpet cleaner shop, they stopped the to another neighborhood they pass is look at all those nice homes over there. So they did a little research. They drove the neighborhood, hired valued homes, manicured lawns, newer cars into the driveway. These were the type of people that would hire a professional carpet cleaner.
The carpet cleaner went back in the office, readjusted his target market for that area,
start sending out his mailers in his business group.
So it's identifying that right market that we have to be working. And so many people don't take that time.
Open the doors of the business. Oh, everybody's my customer. They need what I offer. I don't have to do all that. It's sad to say, Yes, you do again. I've been that trap. I know what it's like, and I won't fall forward again. And I won't let my customers do it, if I can absolutely help it, if they want to take the time to do it.
As you build your business, think about that. How are you going to market? And then what we do is we take
that market and those customers, and we build your plan around it. When we do your business plan,
we start identifying, how are we going to solve their problem with this product or service, where are we going to find them, and how are we going to contact them? Using our core missions, visions, values, and we set our goals according to what we have at our market, and we just keep building on that. Does it stay the same? Absolutely not.
This really should be an ongoing evaluation of your client. Markets shift neighborhoods. Some of them go down, start running unkept, and some new ones come in. You have to always be cognizant of what's going on in your marketplace. You drive down the road, you see something that pops in your mind, oh, wait a minute, I should do this, so I make a little note. Or you see somebody that triggers a thought.
All these come into play in identifying this market. You'll be sitting at a coffee shop. I love coffee shops, mainly because I get out of the house working by myself. But the other thing is, we see this, and you'll see somebody that goes by, oh, I need to talk to them about this. And then that thought will lead to another one and another one and another one. You'll get that snowball effect and help build this. And then you look at that people, that group of people, and
say, they all do this or this, maybe I need to look at that for my product or service as well.
You can do this. It's not rocket science. It's just take some time.
You could do this in a relatively short time, if you put some effort into it.
Start doing that and then writing a message. I used to target neighborhoods in it when my insurance I could go out and buy lists based on this criteria, what I wanted to market to, and then I would start working that list.
Do the same with your business. How are you doing this? What kind of contacts are you making? Identify those people that are going to be the ideal people to grow your business. And don't forget to get testimonials and referrals. Best way to build a business referral market.
And that's a whole nother subject in the discussion.
But spend your time putting all this together. You won't regret it.
And I want to offer my help if you got a question on this, and I can direct this to some places that you can get this in one of the documents I use, and I'll go secret out, is from HubSpot
or direct marketer. They have a customer avatar program. They have a book, and it's free download.
And as one of my team members and one of my companies says, free 99 can't be beat.
Dig into this stuff, findings. But if you need a link, send me a note. Can you give me the link to your avatar program, and I'll send you the link to it so you can get it yourself. But I want to make an offer to you as well, if you're starting your business or you really haven't done a lot of planning early on, and you want to start taking it to the next level.
And there's some things you're not sure what you need to do on my website, at www, business plan, answer man.com,
on the homepage here, right there in the middle, you'll see a sign that says, download the free ultimate business checklist,
name and email in there. Send it off. You will get a return of this checklist of things that you need to consider when you're starting a business. Even if you're new in the business, it might help you, because there's a lot of information on that one that two or three page document. But at the same time, you'll also get a copy of my book from the bottom up, the ultimate guide business planning to profitability. That's a step by step guide walking you through the business planning process. And I'm a simple person, so I like it simple. So there's no big words like delicatessen.
You got a question? Email me Dave at business plan. Answer man.com,
go to my website. There's a comment box there to contact me. Do that. I'm on social media. Business Plan. Answer Man, let me hear from you. Let me help you. Let me be your resource. Once again, Robert, I
want to say thank you. I always enjoy having a chance to share what I've learned in my 30 plus years in business with your listeners. I hope this gives them some insight and help as they build their business. I want to wish everybody listening either live or on the replay,
a great success in all their business. Robert, thank you once again, it has been a true pleasure and honor. Thank you for that thoughtful segment, David. It really hit home when David was talking about that story where the client decided to get in the car and drive around the neighborhood that they were sending letters to, that's a good idea, is to see if you can have some kind of a clear picture about who you're talking to, who you're helping, because sometimes what you imagine and what is reality might be a little different. I also took notes, and maybe you did too with that excellent idea to send out some letters and personalize the letters for each person you're contacting. And that was a really easy thing to do, where he mentioned to send a letter with a picture of the business's front door. And that's a very easy thing to do with Google Maps, Google Street View. And maybe think about how you can do that. Think about, can you send a letter or a message or an email or a video with a picture of that brick and mortar business, of the person's picture of the person's website, put in that little bit of effort to stand out, and that way, you can make sure that your marketing efforts work. In addition to what he talked about, such as knowing your prospect, knowing if they're single, married, high school graduate, so that way you can niche down that market. Don't focus on everyone, have narrower focus, and then target them with the right bait. So that way you are speaking directly to them. And once again, to download that ultimate business Checklist to help you be cognizant of what's going on in your marketplace. Go to business plan answer man.com and then you can email David directly at Dave at business plan answer man.com
and find him on social media at business plan Answer Man, so we'll see you there. Business Plan answer. Man.com Robert plank, marketer of the day podcast, have a great one, and thank you. Go right now to marketer of the day.com/itunes
to subscribe to the show. Listen to other episodes and rate and review the show. You.
Filed in: Archive 3: 2018-2020 • Interview • Podcast
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