What is Micromarketing? Types, Benefits and more…
Micromarketing is a marketing strategy in which marketing and/or advertising efforts are focused on a small group of tightly targeted consumers. For example, markets can be grouped into narrow clusters based on a commitment to a product class or readiness to purchase a given brand.
Micro-marketing requires a company to narrowly define an audience by a specific characteristic, such as ZIP code or job title, and tailor campaigns for that particular segment.
Marketing is a crucial element for businesses operating in a competitive environment. Marketing is a strategy used by companies to increase their brand awareness, sales and, more importantly, profits.
Types of Micromarketing :
A business that markets to people in a particular city or neighborhood.
Marketing to people you know. For example, a consultant may market services to professional contacts established over the course a career.
It is common for business-to-business sales to target a specific job title such as CIO or CMO.
Selling to businesses in a particular industry. For example, an insurance company that designs a product for commercial fishing boats.
Targeting firms of a particular size. For example, an large business software package may only be affordable to a few hundred firms in each region.
Offering products and services to customers with unique needs. For example, an insurance product for extreme sports enthusiasts.
Advantages of Micro-Marketing
Like every marketing opportunity, there are strengths and weaknesses to the approach. Ultimately it depends on your business model. Here are some ways you can use it to your advantage:
- Highly Targeted. In a micro-marketing campaign, you are getting granular. You are drilling down into the demographic to select a specific segment of the population, based on ethnicity, location, sex, interests, and even favorite foods.
- Cost Effective. Micro-marketing campaigns usually come with micro-budgets. That’s not to say they don’t cost a lot of money, but in comparison to a nationwide, hit ‘em with everything you’ve got approach, it’s way less to shell out.
- User-Generated Growth. Micro-marketing campaigns plant seeds in niche areas and let the early adopters do the marketing. When people find something they love, they tell others about it, and it spreads.
Disadvantages of Micro-Marketing
So, you know the benefits. But what are the potential downsides? Here are the top three:
- Higher Cost Per Acquisition. While you are allocation much less of your advertising budget to the campaign, you are also targeting much fewer people than a macro-marketing campaign. It, in turn, can cause the average cost of getting a new customer to go up.
- Possibility of Missing the Target. As mentioned earlier, the shotgun approach of a micro-campaign is going to mean you will hit far more people than with a sniper’s bullet. Micro-marketing campaigns are super-targeted…and that means it can be harder to score a bullseye.
- Time-Consuming. Micro-marketing campaigns take time to develop, and even more, time to plant roots and spread beyond the initial target. Be prepared to spend more time developing and maintaining a loyal customer base. But mighty oaks from little acorns grow.
How Uber Used Micro-Marketing to Achieve Unprecedented Growth
Chances are, you’ve not only heard of Uber but have used the service frequently. You may think that Uber is a relatively new company that experienced rapid growth in record time, but that’s not entirely accurate. Founded in 2009 by Travis Kalanick, it did not start out as a “taxis for all” business model. Quite the opposite. But by using highly-targeted micro-marketing campaigns in just one market – San Francisco—it grew quickly by word of mouth.
“In the beginning, it was a lifestyle company. You push a button and a black car comes up,” said Kalanick “It was a baller move to get a black car to arrive in 8 minutes.”
For a while, that was Uber. An app-based black car limo service that solved a genuine problem in San Francisco. Namely, poor cab infrastructure, dirty cabs, unreliable cabs, not accepting credit cards, and drivers refusing to go to certain parts of town.
Now, for a higher premium, you could travel around San Francisco like a celebrity. The ease of use, the app that tracked the driver, and the safety of knowing the driver and his/her rating spread around the bay area like wildfire.
It spread from city to city, and state to state, much like a virus. And as it spread, the micro-marketing campaign focused on another city, offering free rides or ride credits, and expanding the buzz. Then, additional services were added, like UberX and Uber SUV. Now there’s also Uber Eats, which was again grown by micro-marketing campaigns in key locations.
Uber is not a multi-billion company—not bad for less than 10 years on the market—and a great deal of its success can be attributed to a highly-targeted, laser-focused micro-marketing strategy. Think small, get the early adopters, and let them spread the word for you.