How To Build Market Segments That Predict Small Business Growth
Not all small businesses are looking for new vendors and solutions, so how do you find and target the ones that are? We experimented with the segment builder in Radius to determine which segment attributes define the businesses that are most likely to grow.
In the sunny San Francisco suburb of San Carlos, California, Eric Sevim runs an auto mechanic shop, A+ Japanese Auto Repair, with his brother. They inherited the shop from their parents ten years ago. For the past five years, Eric reports consistent growth of 20% annually. He’s currently installing new lifts so the shop can take on more cars at a given time to help busy people get their cars serviced while they’re at work. Eric doesn’t run a stagnant, small time auto mechanic; he runs a growing business for which needs and goals shift as new hurdles are overcome.
In a sea of data about small businesses, how do marketers that serve the small business space find and reach businesses like Eric’s?
Not all businesses want to grow, and businesses that don’t want to grow are unlikely to need new products and services. For many marketers, small business growth is an important indicator of a target audience’s willingness to adopt new products and services or work with new vendors. The ability to predict small business growth may give modern marketers an edge as competition to reach the small business market heats up.
Indicators of small business growth
As businesses grow, they go through a series of predictable behaviors that we can track in the Radius Business Graph. As you can see in the image from CEB below, adoption of websites, Facebook pages, and online reviews grows increasingly likely as business size increases until it reaches a point of plateau.
These modern attributes – website, Facebook page, and online reviews – can help us understand at which phase of growth a small business is in.
Why these attributes?
According to statistics from BIA/Kelsey’s Local Commerce Monitor, small businesses adopt web technologies primarily for the purpose of acquiring new customers.
Further comparison of business size as it correlates to online attributes has led us to the creation of the following timeline of business growth as it pertains to a business that may be interested in acquiring a loan.
We can use the Radius application to determine which businesses may need reputation management software, which businesses may need email marketing services, which businesses may need financial services, as well as any number of products and services they require to grow along the way. Business growth can indicate which businesses are most willing to invest in your products and services at a given time.
Indicate Growth & Budget: Businesses investing in their digital presence, technologies, or advertising are powerful indicators of a target audience’s willingness to adopt new products and services or work with new vendors. Investments also indicate budget!
Personas: Personas help you align your marketing efforts to the goals, challenges, and personalities of your customers. With signals, marketers can gain customer insights needed to create detailed personas and then personalize their marketing efforts for them.
How to build segments of growing businesses in Radius
In Radius, you can build segments of growing businesses by using various combinations of the attributes we’ve established as growth indicators to create segments like the one below, which identifies bars in Chicago that maintain Facebook pages and websites.
When you can identify segments based on business priority and web attributes, you can get a lot more creative about the campaigns you can deploy to reach those segments.
For the above segment, web-savvy bars in Chicago, you could:
- Run Facebook ads with copy around customer acquisition
- Host an event for bar owners looking to maximize their web efforts to grow customer base
- Advertise at alcoholic beverage stores, publications, and websites
- Run a Facebook contest to determine the best summer cocktail
- Deploy an email campaign helping bar owners understand how to engage bar patrons on Facebook
When you understand your target audience, designing campaigns becomes fun, effortless, and effective. How would you change your campaigns if you knew your prospects’ priorities?
To learn more about building segments in Radius, we encourage you to sign up for a demo.
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