Let’s talk about how to find a bunch of people who want to give you money!
I recently wrote an article titled Who the heck are you marketing to? On Buyer Personas…
It was all about the value of market research, and knowing specifically who you’re marketing to. Because, among other reasons, knowing EXACTLY who you’re marketing to is one of the most powerful ways to be able to craft the perfect message that resonates with them 100%, and gets you response.
Well, that article spurred a question from long-time Breakthrough Marketing Secrets reader Amanda. And since it’s Monday, I thought I’d grab Amanda’s question out of the ol’ mailbox, and dive deeper on the topic of market research…
(Remember: you can get YOUR question answered by hitting reply to any of my daily issue emails, or email me anytime at Roy@RoyFurr.com.)
Here’s Amanda’s question…
Great article today, thank you! I have a question that’s been nagging at my brain for a while.
What’s the best way to discover your market (or any market)? You mention research and early market testing. Can you elaborate?
For example, in one of Dan Kennedy’s books (maybe the Ultimate Marketing Plan) he has a case study where they “discovered” a mail-order bride business’s best customers were twice-divorced men who were also long-haul truck drivers.
How do you find that kind of information so you can come to conclusions like that?
This is a great question — and there are MANY answers based on where you’re at in the development of your business or product you’re looking to sell…
I’ll answer the specific about finding an ideal buyer archetype in your list (based on that Kennedy example) toward the end. But I wanted to use this question as a way to dig into the many types of market research that I do from time to time. And so I’ll walk through based on how developed YOUR business is…
… Starting with what you might do when you’re looking to create a product line or business from scratch, to serve an existing market…
… All the way up through what you want to do if you have a list of previous buyers, and want to go out and find a lot more people like them…
All-in, I came up with 5 big types of market research you might do, plus an added 1/2 point that you can use to immediately validate whatever research you do.
- The classic SRDS trick…
Back before the internet, direct mail marketers used to rely on list brokers to find them direct mail lists. These lists could be compiled lists, or response lists. Compiled lists were based on demographic data — imagine the phone book, sorted based on things like income, home value, occupation, gender, etc. Response lists were based on people actually responding to an offer.
Well, nobody could keep the vast world of lists in their head, so most list brokers would rely on a direct mail list directory from a company called Standard Rate and Data Services, or SRDS. This was a huge directory of mailing lists, giving you just enough information about each list that you could reach out to relevant list owners and ask for their data card, with more info on the list.
Well, many of the direct mail greats started their business by researching the SRDS directory. They’d flip through, and find a category of lists that looked interesting. When they found a bunch of companies with lists in that category, with a number of sizable response lists, they knew they had a market of buyers. They’d research the companies and products these consumers were already buying, and create a competitive product. Then, they’d mail to these lists, knowing that they were selling to a crowd of high-probability potential purchasers.
By building a product to suit a known market (that could be reached easily by direct mail, using these rented lists), they knew they were giving themselves a good chance of success. Further, the more research they did on what these folks had already bought by mail, the more they could cater their product to the same needs the prospects had already responded based on, when buying previous products in the market.
Today, you could still buy an SRDS online membership, but you can get most of the same value by going to the free Nextmark lists tool where you can search and browse both postal and email lists available for rent today.
- The Barnes & Noble Trick…
Another quick trick you can use today to do research on what people buy — that’s especially relevant for selling information but easily generalizes — is to head to your local bookseller.
Start browsing. Do you want to write a self help book? A business book? Perhaps a steamy romance? Or do you want to serve the people who buy and read these books with another higher-end offer? (No comment on what your offer is for the romance market!)
Find the category for the topic you want to cover. How big is it? How prevalent is the section in the store?
Here’s a hint: big categories sell more. Books with their covers out tend to be more popular than the ones where you can only see the spine. If there are a ton of copies of a book there, that also tells you it’s popular now or has been recently.
This is all market research. It tells you what people are buying, on that topic.
If you want to write a best-seller, you’re better off finding a category full of best-sellers, and writing something that’s 5% unique from what’s already selling well, rather than trying to be original. Look at the top 5-10 books (you can look at magazines, too) on the topic, find what they have in common, and try to incorporate that as you create something original and uniquely you.
That’s a far better bet for actually making sales than trying to create a market from scratch on a topic nobody’s shopping for.
But here’s a hint. This doesn’t just apply to going to the bookstore. You can use this same trick at any major retailer. Cosmetics, clothing, toys, supplements, tools, whatever. Find what gets the most floor space, and you can reasonably assume there’s a good size market for it.
Shortcut you could do right now: go to the Amazon.com Best-Sellers lists. They are the world’s largest online retailer, and probably the world’s most data-driven retailer. Just looking at the categories and subcategories there tells you a lot. But you can also dive deeper and compare best-selling products, books, and so on, to teach you a lot about what people are buying.
- Keyword Research…
Going deeper, let’s say you’re interested, in a particular market, but want to know how big it is and what people are looking for.
The best bet here is to do some keyword research. Google’s Keyword Planner is a powerful tool made free for businesses that are actively spending money on AdWords. There are a lot of alternatives out there, too. Search “keyword tool” online and you’ll find an effectively unlimited selection of tools.
The idea here is that you can actually take a look into what people are searching for, and really start to get a picture of the problems people are trying to solve, as well as the solutions they’re researching.
Just plug in your keywords and it will give you a general idea of the search volume on the keywords. But here’s where it’s even more valuable. It also gives you a ton of other ideas for potentially-related keywords, with search volume information on each.
If you’re advertising on AdWords or doing SEO, you can target each keyword separately. In the context of today’s essay, it also tells you about sub-markets that might exist. Example, I put in “copywriting training” and it recommended “accredited copywriting courses” as an example. That tells me there’s a subset of the copywriting training market that wants academic accreditation for copywriting. That could be potentially very useful.
- The Ask Method…
I’d be remiss if I didn’t mention Ryan Levesque’s Ask Method here.
Once you’ve identified a general topic area or target market and think you have a good idea that you’d like to serve them, and want to make sure you do it best, follow Ryan’s Ask.
Basically, you ask, “What’s your single-biggest challenge related to…” Done right, and analyzed based on Ryan’s step-by-step process, you learn the 2-5 biggest unsolved challenges your market is facing today, even with all the other options available to them.
If you build a product or service to suit that both covers the well-established bases plus addresses these additional challenges, you create an offer that’s practically irresistible to the market.
That’s about as far as I can go here and maintain length, but that link above gets you the book on Amazon, which covers his method in-depth.
- Internal List Analysis…
Here we get to the method that Dan Kennedy applied in that brides-by-mail business case study.
That was for an established business that was looking to do better. They took their list of buyers to a mailing list broker, and had it profiled. When you do this, they give you all the demographic data back on your list, including things like age, sex, occupation, etc.
This is a really simple process. Basically, they run your list against a bunch of publicly-available data, and wherever they find a match, they tally that up. In the end, they can tell you big, broad trends about who is on your buyer list.
One example of this is Customer Analysis and Profiling from InfoUSA. Most list brokers who do this offer it as a very affordable service, because they know they can use this information to sell you list rentals of people like your current buyers.
1/2 BONUS: Test…
Now for the 1/2 part of the 5 1/2.
You can get a lot of intelligence from following what I’ve laid out above.
No matter whether you’re starting a brand new business to serve an existing market, or you’re looking for more customers like your previous ones for a well-entrenched business, there are a ton of opportunities for research.
And in the Kennedy example, finding the right data can be huge. Because once you know, for example, that 40% of your buyers are long-haul truck drivers, your targeting options get hyper-specific, so you can focus on ultra-high ROI marketing investments.
No matter what you do, follow the advice laid out almost a century ago in Scientific Advertising. Test small, prove that you’re onto something, then roll it up as your ROI supports.
More market research is almost always valuable. But the ultimate market research to validate all discoveries and assumptions is when you actually use what you’ve uncovered to spend $1 on advertising and are able to earn back $1 or more in return, with a customer in tow.
Yours for bigger breakthroughs,
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