Before you create an advertisement, what do you want to know about your audience?
Well you want to know as much as you can about these people. You want to know demographic information, that's their age, where they live, their income, and psychographic information's really helpful. That's more lifestyle, interests, their hobbies.
There are a few ways to do that. If you have existing customers, you look at your customer base because they're your best source of information. You can get the demographic data then do surveys to get psychographic information. And if it's a new business you consider who want your target audience to be and you do market research to find them. Or you can locate your competitors and see what they do.
How does this information help out when creating an advertisement?
Well advertising is all about motivation, so the more you know about somebody the easier to find their motivation. When you sit down to write an ad, the first thing you do is come up with features and benefits. So you take a product and tell people what's in it for them. So when it comes to like life insurance, for example, you don't sell life insurance, you sell peace of mind. When it's laundry detergent, you don't sell laundry detergent. You sell cleaner clothes, whiter whites, fresher smelling laundry. If you don't have a motivation you need to create one. In the 1930s, American women didn't wear diamond rings. So De Beers diamonds had a glut of diamonds in their South African mines. So they started a campaign to increase the value of diamonds in the minds of Americans. So they wanted men to think that the best way to show woman that they love them is to buy a ring. And the bigger the ring the more they're loved. To make a long story short, this marketing strategy turn into an American tradition today. I think American brides, I think three quarters of all brides wear diamond rings and the average price is $40,000. So it worked.
What are some ways that you appeal to differetn target audiences?
Well the classic approach is problem solution. If you have a product that solves a problem, you present it that way. When we talked about life insurance, the problem is if something happens to the breadwinner, the family can't afford to stay in the family home. Their income drops, their lifestyle changes, that's the problem. You present life insurance as a solution. These days we do a whole lot with behavioral economics also, that's the psychology of buying. So in the De Beers diamonds story, they created perceived value, that's a behavioral economic principle. Another one is emotion, people will buy if they want to be happy or to avoid regret. There is a Subaru commercial out right now. I don't know whether you've seen it, it's called Sorry. It features young drivers who are in an accident and they call their parents. They're upset that they had the accident, but they're safe. They're safe because they drove a Subaru. So the thinking here is people will buy their children Subaru's because they're safe. And thus they'll avoid the regret of getting the call that says they were in an accident and got hurt.
Another behavioral economics theory is herding. McDonald's has been doing this for years. When they started out they had signs that said the number of hamburgers that they sold. When they got to 99 billion I think they stopped. So now they say billions and billions with the idea here is that if so many people have eaten these burgers, they must be good. And that's the herding principal.
Has social media changed the way in which you target audiences? How?
Social media has made a huge difference, it's just been a game changer. It used to be traditional advertising was a one way street, it was a one way conversation. You just put your story out there, you don't know how people will react. If they bought, you thought it worked, but you didn't have an immediate reaction to it. Social media has changed that. Now it's a dialogue and it can happen in real time. There's social monitoring, social listening. So you can really have feedback from your customers, and you can respond to it. Jeff Bezos of Amazon said something like your brand is what people say about you when you're not in the room. And now you can be in the room, and you can tweak your brand and you can promote your brand all the same time.
Can you walk us through an example of how you used information on a target audience to develop an advertisement?
About five years ago, a company came to us who's an insurance company, a car insurance company. And they were marketing a new company, and it was for drivers that needed just minimum coverage. There's a lot of competition in this field. It's people who gone out through people who can't afford car insurance. But as you know to drive in the US, you need car insurance. So they offer minimum coverage, just what you need to be legal. When we started these campaigns, we assumed that our target audience would be people who were driving but didn't have insurance. So we did all kinds of ads and TV spots with people, showing them the risks of being uninsured. We show them being stopped by police, and we say to them, look if you don't have insurance, you could lose your license, you could get fined, you could even go to jail. So we kind of scared them into buying the product. Well it took off, and it did really well, but we did more research and found that there was this whole group of people who aren't driving uninsured. They're leaving their cars in front of their house because they wouldn't drive uninsured. They're law abiding citizens who are afraid to take the chance. There are people who come to the grocery store with their children and taking the bus home. They're waiting for rides for work and they're afraid of losing their jobs because they're late. They're taking two and three jobs, two and three buses to get to their job. We started doing campaigns that appeal to these people, and it worked even better. Because we found a market that people weren't tapping, and it also helped us tweak the brand a little. So instead of selling cheap car insurance, we're selling cheap car insurance that got you where you were going a whole lot faster, made your life easier.
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