In order to advertise effectively, a company must know how many of their customers, or potential customers fall within a standard population of 1000 people (or some measure of likelihood of bumping into one). The reason that this is so important is that some companies are fortunate enough to sell products that are used or consumed by essentially the entire population, while other companies are truly looking for a needle in a haystack.
Before you put together an Advertising campaign, consider carefully how many people in the general population might be interested in your category of product. This knowledge will help you identify what advertising mediums might be best suited to reach these customers, and how much of your efforts my be completely wasted on a group of customers that are either not interested or financially unable to purchase your product.
Let me use a couple of examples to make my point:
Fast Food - If you are selling fast food, your potential customer incidence rate is very, very high - at least in the US. I believe that the latest numbers show that the average American eats fast food, on average, twice a week. And further, most of these decisions are made within two hours before they are actually ready to eat - so many of these decisions are made on impulse. Which is why many fast food restaurants tend to sponsor radio commercials right around meal times. Now you're probably saying that it's possible that a small minority of people eat fast food very, very frequently and the rest of the world may not eat fast food very often at all. That may be true - but there is a very small minority that has sworn off fast food entirely and stick to their vow. So, the incidence rate of fast-food eaters is still very high, although there is undoubtedly a wide variability of the frequency of eating fast food. So this would lead me to believe that a very broad based advertising campaign might make sense for a standard fast food restaurant.
Vertu Cell Phones - Now I'll jump over to another extreme to make my point. Nokia phones has a sub-branded phone that is called Vertu. Vertu phones are exceptionally high end phones, priced between a few thousand and several thousand dollars per phone. They are made of exotic materials, some of the higher end models are encrusted with diamonds. Simply holding one in your hand gives you the feeling of being a titan of industry, a God among men. They have a very unique and distinguished design, and are each handmade in England with the exceptionally fine detailing and very unique capabilities. Each Vertu cell phone comes with a special button and a concierge service that can help you with such dire emergencies as urgently needing to know where the nearest 5 star Sushi restaurant is to your current location, in whatever city you happen to be in that day! As their website says, "These are handsets for individuals who only accept the best". However, adding to the exclusivity of these phones, they're also hard to find. In all of our United States, there are only 15 states that have one or more places where you can buy these phones. They're typically in stores that have a nicely dressed security guard and where you have to press a buzzer to be let into the store. For a product like this, the customer incidence is much, much different than it is for fast-food. There are probably only a few very high end magazines that Vertu advertises with - and as it should be. I've never actually seen anyone with one of these phones, although when I travel on research I often peer through the window and wonder what the life of a person that can afford that type of artwork (and they most definitely are, artwork) must be like.
Marketing fast food is much different than is marketing a $7000 cell phone, I agree. However, I believe that these examples may help to demonstrate the need to have a clearly defined target customer, and to understand what he/she reads, where he or she shops and what really motivates these people to purchase.
Is Your Ad Spending Hitting the Sweet Spot?
Chris Hawkes
