Targeting Your Alpaca Business for Success Means Identifying Your Target Audience!
Something for everyone!
I cringe when I hear the word “everyone” in a sales pitch. You cannot market to the masses effectively without losing the depth of your product or service. Conversely, you cannot have a highly specialized storefront AND have something for everyone. It is a smarter business approach to market to your target audience.
Think of even the most successful stores. Wal-mart as an example has a vast range of products but lacks the depth of any one product line. Conversely, Starbucks has an in-depth variety of coffee but lacks in other beverage choices. Both are very successful even though neither can claim that they have something for everyone. In an era of ever-increasing competition, successful businesses need to think of their target audience when marketing a product or service.
What is the target audience? Simply defined, a target audience is a particular group at which a film, book, advertising campaign, etc., is aimed. In determining market audiences, Caroline Cummings makes a distinction between three different types. She identifies the terms TAM, SAM, and SOM and states that “a common (and critical) item missing from most plans is a breakdown of the company’s TAM, SAM, and SOM in the marketing section of their plan.”
TAM = Your Total Available or Addressable Market (everyone you wish to reach with your product)
SAM = Your Segmented Addressable Market or Served Available Market (the portion of TAM you will target)
SOM = Your Share of the Market (the subset of your SAM that you will realistically reach—particularly in the first few years of your business—this is your target market)
Identifying your TAM, SAM, and SOM is part of market research, a critical step of any business plan. Your SOM, or your target market, is an essential component because building a marketing plan around your TAM—in other words, everyone—is a giant waste of resources. It is far wiser to direct resources toward your SOM (share of the market), which is the portion of your SAM that your business model can currently realistically serve. As an example, your SAM might indicate three employees to cover it adequately, and if your business has fewer than three employees, you will not be able to service your target audience adequately. It is better to be responsive to your SOM, rather than SAM as you cannot meet the demand due to the limited available employees.
Over the years, it has been ever so important for me to revisit and review my SOM, or "Target Audience" to stay in alignment with my business plan. I'll be the first to admit that there are so many opportunities, avenues and just downright "fun things" to do in the alpaca business. It's incredibly easy to get off course and venture a path that might or might not be suitable for your overall plan. That's doesn't mean it's bad to experience something new, but rather every business decision you make should fit within the overall business plan. And I think that reflecting on your SOM, or target audience is a relatively easy method to ensure that you are moving forward and not veering off course.
Why is it important that you ensure your business plan and target audience are in congruence? I'll provide a few examples.
An advertising agency approaches you to advertise your B & B. The agreement states that the agency will promote you in an upcoming event publication enticing visitors to your area, and as part of the advertisement, a lucky winner would receive a free night stay at your B & B. The agency would purchase the night stay but at a reduced price. On the surface, this looks like a fantastic opportunity to host someone on your farm. The advertising audience is vast and includes an entire metro area.
You decline the offer once you think of what it has to offer you and what it has the potential to cost you. Your reasoning is the B & B is a single rental, and it is a secondary business; it supports your primary market, the alpaca farm. To that end, you target persons to stay in your B & B that might have any of the following traits/identifiers—livestock, farming, agriculture, eco-friendly, carbon zero, natural fibers, textiles, rural living, homesteading, etc. You promote it as a destination rather than lodging for the local events. In other words, you look for persons who want to stay at your B & B as a destination in and of itself, rather than because they are in the area and it is a convenient place to stay. Or because they won it in an auction. Your target audience is people that are interested in livestock and farming, and the target audience for the auction is much broader and diverse.
The advertising agency's target audience was not comparable to your target audience. It would have meant you lost money up front because it was for one night, whereas the cost is the same whether it's one or two nights. Secondly, reimbursement is at a reduced rate. Finally, there was a lesser likelihood that you would receive any long-term impact from the free advertisement, especially with such a broad and diverse audience.
Here's another example. You operate a retail shop, and the target audience for your shop focuses on men and women, age 35 to 60 and whose occupation is professional or administrative looking for unique boutique clothing. You've thought to target the high school students in your advertisements because of their spending habits. However, knowing that the 14-24 age group is driven by Brand Names when purchasing merchandise means that they would not be likely to buy the "off name" clothing in your shop. Secondly, you know that the majority in that age group seeks "likeness" rather than "uniqueness" in how they dress.
Sometimes you have to change your marketing strategy to meet the target audience better. Here are a few examples.
There are many opportunities to set up vendor space at local fairs, but if you don't correctly identify the target audience, it is likely to become a high work-low return event. If you take alpacas to a craft show where people are buying PA Preferred products, what is the likelihood that you will engage "X%" of people about alpacas as a farming business? However, if you take PA Hand-Crafted Products to a PA Preferred Expo, the consumers will most likely engage with you in conversations that focus on production, harvest, and manufacture of raw materials to finished product. Hiring the customer on the common theme that caused them to want to attend is more likely to create a sale and hopefully, a repeat customer that will seek you out in the future.
Anticipate the participant demographics (target audience) you would expect to see at an Outdoorsmen Exposition. There would be adults, families, possibly some with young children, maybe a few sports fans or hunting or fishing enthusiasts, or weekend "warriors." Deciding on a product to sell at such an event might mean that you would not display fashion scarves, yarns, and light gauge sweaters. Instead, you might concentrate on socks and activewear, items that the likely audience would be more liable to buy. Your marketing literature and display setup for this particular event might include photos or posters of people participating in various outdoor activities, or information about some of the technical aspects of the socks. You might be able to promote the socks because of endorsements from well-known athletes or celebrities. Or perhaps you can focus on the manufacture and reap the benefit of being made in the USA, or produced using environmentally friendly techniques. However, taking alpacas to such an event might not be an effective marketing strategy. While the alpacas might create a draw to the booth, they will also likely distract from the product. While you are busy discussing the many attributes of raising alpacas to customers, you are also losing potential interaction with customers that might want to buy your product. Your target audience is people interested in an outdoor event, and not people interested in livestock.
Conversely, the target audience at a general livestock event would likely be knowledgeable about farm animals. Taking alpacas to such an event would be an excellent strategy, where you can expect a much higher percentage of people to engage as potential future alpaca farmers and ranchers. In this scenario, it would be better to provide information that addresses probable questions and remarks. Such statements as "what do you use them for," "how do you make money," "can you eat them," (which is always asked by farmers) "how much do they cost," and so on. General audiences or potential new alpaca owners might find pedigrees, show winnings and fiber analysis interesting, but you will be more effective by concentrating on what your target audience needs, in this case, general animal husbandry knowledge. They probably won't be as interested in pedigrees, show winnings, and fiber analysis as an introduction to alpacas. Targeting fellow alpaca owners would include promoting pedigrees, show winnings, and fiber analysis.
I think learning about your target audience is critical to a successful business. While it's true that it is "good" to educate the general public about alpacas, shouldn't it be adequate to extol the virtues of alpaca fiber? Alpacas attract attention and might help you sell a pair of socks, but I believe the alpaca product speaks pretty darn well for itself! Think of the target audience and ask yourself if they are more likely to buy an alpaca product or an alpaca. And if they are more apt to buy an alpaca product, we want them to visualize "soft, warm, eco-friendly luxury clothing," when they hear the word alpaca...not "huggable investment or easy lifestyle!" Not only will it help you be more effective and productive in your sales, but it will also help to clarify the branding of your product or service.
Knowing your target audience is vital on many levels. Firstly, it helps ensure that your sales are aligned with your business plan and secondly, it allows that you market correctly to meet your target audience. By focusing on a target audience, you might be able to work less yet be more efficient. Think about your expectations and your target audience in everything you do, and you might find yourself more productive!