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Marketing to an Increasingly Segmented Audience

February 01, 2018

Hey, did you watch the Grammy Awards? Probably not, since it was the lowest watched Grammys in nine years, taking a 24% drop since the last one. A big part of this seems to be due to the fragmentation of the audience. With more and more people neglecting traditional TV for streaming services, and with easy access to niche music genres, a broadcast award show that recognizes only the top entries in each field may no longer resonate with today’s segmented audience.

 

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Traditional marketing simply cannot reach as many people as it once did. Even the superbowl of advertising, the Superbowl, is seeing less reach each year due to people either watching it via other channels or tuning out entirely. Reaching your audience is no longer a shotgun approach. It’s barely even surgical anymore. It’s nearly microsurgery. So how can small and mid-sized businesses with limited marketing budgets get anything going?

Social media marketing is not a great answer.

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Yet here’s the problem. People don’t really trust ads on social media anymore:

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Referral marketing is a better way to target audience slices.

Referral marketing

Instead of going whole hog on social media, a sound referral program is a more lucrative marketing channel. Focusing on referrals tackles the issues above:

  1. Referrals from friends, family, and even influencers are trusted, more than any other advertising source.
  2. A good referral program provides SMBs with an external sales/marketing force, where content and conversions are created for you, by your customer base, saving time.
  3. You run the program in-house, and aren’t subject to the whims of social platforms.

SMBs should focus efforts on referral and affiliate marketing due to high return-on-investment rates and because it’s a cost-per-sale model, meaning you only pay when you make a sale.

So referral marketing is less up-front cost, less effort, and usually see a higher return; a perfect channel for SMBs to concentrate their marketing efforts on. Yet referral marketing doesn’t crack the top three channels SMBs use (as seen above)! Keep in mind this stat from the Wharton School of Business (via Forbes):

83% of satisfied customers say they are willing to refer products or services. Only 29% ultimately do.

Meaning, your customers are ready and willing to refer. All they need is a little push (ie. incentive) to do so. That’s precisely what businesses need to focus their efforts on accomplishing. If you don’t, you’re leaving money on the table.

All the time and money in the world, businesses would focus on every marketing channel. But realistically, especially for SMBs, referral marketing is a better bet to invest in over channels such as social media.

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Written by

Ruthie Carey
Ruthie Carey