“Nothing is more expensive than a missed opportunity.”
– H Jackson Brown Jr
In my last two articles, I’ve been talking about the 5th marketing fundamental you need to succeed in 2021. I call it your Who. It’s what many call your “target market.”
You might think you don’t need to learn more about this because your company has already chosen your target market.
But what if there is an even more profitable market, or segment of the market, that you could be focusing on?
Because the fact is, once you’ve chosen a target market, you want to take time to make sure it’s the most profitable one or that there isn’t some valuable segment within that market that you’re overlooking.
What is Market Segmentation
That leads us to something called “Market Segmentation.” What is market segmentation? Don’t let the term intimidate you. It’s just a process of dividing a target market into smaller, more defined categories.
Market segmentation is an important part of determining the exact Who you should be marketing to. It can help a start-up company to have more success in its early stages or it can help an established company achieve a new level of success.
You’re about to hear the story of how one well-known company gained popularity and success after starting out focusing on a completely different market.
But once they changed markets, and then focused on a specific segment, they achieved success like they never did before.
You’re about to discover:
- The surprising origin of Play-Doh
- Market segmentation lessons from Play-Doh
- 3 ways you can uncover new opportunities and new customers
The Surprising Origin of Play-Doh
I am sure you’ve heard of the kid’s clay-like substance called “Play-Doh”.
But you might not have heard how it came to be the well-known toy we all know and remember fondly.
Believe it or not, Play-Doh didn’t originally have anything to do with kids and fun.
It actually was manufactured as a cleaning substance for wallpaper.
From what I hear, the dough-like substance was rolled against wallpaper to remove built-up, soot, and dirt.
The Teacher and the New Idea
But in 1955 it made the shift from a wallpaper cleaning product to a kids joy-maker.
How? Well, after World War II, the wallpaper market was changing.
The demand for a cleaning substance was decreasing because peoples’ heating systems were more efficient and vinyl wallpaper was easier to clean.
One day Joseph McVicker, the nephew of the inventor, heard his sister-in-law (a teacher) complaining about how difficult it was to work with her students and the clay they used in the classroom back then.
When McVicker heard that, on a whim, he gave her a supply of the wallpaper cleaner to use with the kids in her class.
She used it, the kids loved it, and McVicker realized he was on to something.
His next move was a genius one.
Tested by Thousands of Cincinnati Kids
He decided to supply the schools in the Cincinnati area with his substance, which basically got his “play dough” into the hands of thousands of young product testers.
You can guess what happened next.
News of this amazing squishy goop spread from kid to kid and parent to parent.
McVicker decided to keep the momentum going.
He did that by demonstrating and selling the item in the toy department of a store called Woodward & Lothrop Department Store that was located in Washington, D.C.
At this point, McVicker realized this could be a big thing.
Because of this, he formed Rainbow Crafts to manufacture what he began to call Play-Doh.
He later sold his company and all the rights to Play-Doh to General Mills.
This made him a millionaire before the age of 30.
Market Segmentation Lessons From Play-Doh
What is the lesson you can learn from this?
- Always be open to new markets, market segments, and new uses for your products and services.
- The current ways your products and services are being used might not be the most profitable.
- The current type of customers you sell to might not be the only ones, or the best ones, for you to sell to.
IMPORTANT: Notice how the process happened for McVicker. First, he discovered a new use for his product, which led to him providing it to teachers (a new market). That led him to decide to sell it directly to kids/parents (new segment).
3 Ways You Can Uncover New Opportunities And New Customers
If you want to uncover new opportunities and new customers for your product or service in 2021, then here three ways you could do that:
1. Ask your customers how they actually use your product or service.
This can lead to new revelations about how your products or services can be used.
2. List all of the end results that your product or service provides.
Notice that I said “end results.” Thinking of these will help you to break out of the confines of its current use.
3. Look for customer groups that you currently don’t target who want those same end results.
Just do me a favor. Don’t wait till the current demand for your products or services lessens.
Begin the search now. That way if the demand lessens, you’ll be ready.
And if it doesn’t, you’ll increase your profits and have a stronger company that can better serve your current and future customers.
QUESTION FOR YOU:
What ways have you discovered new opportunities and new customers to serve?
Let me know in the comments below.
Stay Tuned for Another Story About Another Popular Brand
If you liked the Play-Doh story, you’re going to like the next one I have for you.
It’s going to be another story of how a popular brand achieved new levels of success – after they found out about a new market they had never known of before.
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