Identifying our target market comes from trial & error and reviewing our current customers. As a digital marketing consultant, I feel better when I break this approach down in a much simpler way.
Target Market Age Breakdown:
Age Vs Average Cost of sale
- 18-25 x ACS = x – Average Gross Profit = Avg Net Profit
- 26-35 x ACS = x – Average Gross Profit = Avg Net Profit
- 36-45 x ACS = x – Average Gross Profit = Avg Net Profit
- 46-54 x ACS = x – Average Gross Profit = Avg Net Profit
- 55-65 x ACS = x – Average Gross Profit = Avg Net Profit
- 65+ x ACS = x – Average Gross Profit = Avg Net Profit
Now we have a great starting point to access our data, and make an informed decision. However before doing this, I like to see your business as a whole. What does your business look like in whole.
I like to take your Total Revenue – Total Cost = GP. This snapchat allows me to see a full view of your top line numbers, and see how we are operating. However, I am mostly interested in net.
Then divide your Revenue by the number of customers you have based on each month. Here this allows me to see the fluctuation of peak months vs slow months.
The question I also like to see is if the average customer sale changes during the month. Even though months may be slow in terms of customers buying, revenue may be even or greater than other months. This showcases higher purchases amount or volume.
After identifying these key pieces we move into different age groups, and their average net profit for your business. Questions we need to ask ourselves:
- Which age group has the highest avg net profit?
- What’s the simplicity level of targeting this age group?
- What are the typical behaviors of this age group?
- Which communication channels do they communicate on that we can launch our ads?
- How can we efficiently ensure a profit based upon our budget vs average cost per sale.
- How can we target our age group through multiple channels while keeping our budget within reason?
Example: If an average customer is worth on net $4000. Why not put at minimum a $4000 grand budget to gain a new lead that is a buying customer.
From here we focus on how to split up the channels to best reach that age group.
If we pick 25-36, they may be business professionals, who are in a millennial age. We can reach them through:
- Connected Tv – How often does this age group watch tv, binge watch, or use streaming services?
- Programmatic Advertising – How often are they on the internet surfing websites via tablet, mobile, and desktop?
- Social Media – How much time is spent on their personal social media channels?
- Email Marketing – Does this age group view their email, and do they react?
- Mobile Marketing – How connected & frequent does the age group text or have their phone?
- SEM – How does this age group view Ads on Google?
- SEO – How savvy is this age group with search, especially with search with intent to purchase?
- Youtube – How often does this age group watch videos on youtube?
Now, how can we invest an appropriate amount of money within the correct channels that match our audience?
But first, we need to rank these channels, and fully understand which channel has the most attention, most reaction, and easy of application to generate leads.
This my simple breakdown of using accounting to find the correct lead, and the most profitable lead.