Ignoring Your Target Market is Costing You Money

August 2, 2014

That’s right! Ignoring your target market translates into your business wasting away money. Do you really want to spend thousands of dollars trying to attract strangers to your business that aren’t even interested in your products or services in the first place? Probably not. That’s part of the reason why inbound marketing is so important.
The big idea behind inbound marketing is centering your marketing efforts around your ideal customers, or buyer personas, so that you’re only spending money talking to people in the market for your products/services. While traditional marketing tends to be interruptive and potentially aggressive, HubSpot describes inbound marketing as a buyer/human-centric method that includes the business and the customer in one conversation.

How Targeted Marketing Saves You Money

1. Targeted marketing results in lower cost per lead and cost per customer averages.

HubSpot’s 2013 State of Inbound Marketing report revealed that “inbound marketing activities save marketers an average 13% in overall cost per lead and more than $14 for every new customer acquired.”

As you can see, the average cost per lead (CPL) and the average cost per customer (CPA) for companies following the inbound methodology are lower than companies running traditional marketing campaigns. This trend is a result of those companies specifically targeting and talking to a defined audience in an engaging way. By providing helpful and relevant content to your ideal customers, you start to attract them to your brand.

When analyzing B2B and B2C companies separately, HubSpot found that B2B companies have a 53% higher CPL average than B2C companies, attributing the trend to the shorter sales cycles of B2C firms. This means that B2C companies have the potential to save even more money than B2B firms through inbound marketing by targeting customers.

2. Targeted Marketing Produces Higher ROI

The inbound method is proven to drive more leads to companies at a lower average cost, leads that convert at higher rates than leads acquired through traditional methods. If you’re still not convinced that ignoring your target market is costing your company money, take a look at these two startling statistics from the 2013 State of Inbound Marketing report:

• 41% of marketers confirm that inbound marketing produces measurable ROI.
• 82% of marketers who blog see positive ROI for their inbound marketing.

What is the Inbound Methodology?

So if you’re tired of throwing away company money on marketing efforts that don’t generate results, it’s time to switch to the inbound method of marketing.

HubSpot describes the inbound method as a four step process:

1. Attract strangers to your business through blogging, keywords, and social media to turn them into visitors to your website.
2. Convert those visitors into leads by acquiring their contact information through forms, calls-to-action and landing pages on your website.
3. Close leads into customers by reaching out to them via email and sending lead-nurturing messages.
4. Delight those customers into promoters of your brand.

Take the First Money-Saving Step

Define Your Target Market

Now that you have an idea of how much money you can be saving by following the inbound marketing method, do yourself and your company a favor by clearly defining your target market during the first phase of your marketing plan. If you want to be able to effectively communicate with your target market, you need to learn to speak their language, which involves getting to know your ideal buyers by breaking down the 10 components to understanding your audience.