How to Sell Your Product or Service - Market Segment & Client Profile (Part 3 of 11)

Summary

This module focuses on identifying the Total Available Market (TAM) for a product or service. It emphasizes the importance of creating a buyer profile to target potential clients effectively. The process involves generating a list of potential buyers, categorizing them into B2C (business to consumer), B2B (business to business), and hybrid segments, and then prioritizing these categories based on the likelihood of sales. The example of a pest control company is used to illustrate how to segment and prioritize the market, ultimately defining a market niche to focus sales and marketing efforts.

Takeaways

• 🌐 **Total Available Market (TAM)**: The concept of TAM refers to the entire potential market for a product or service, but realistically, not everyone will buy it.
• 🎯 **Identify Target Customers**: It's crucial to develop a profile of potential customers who are most likely to purchase your product or service.
• 📝 **Create a List**: Start by generating a comprehensive list of all potential clients who might be interested in your offering.
• 📋 **Categorize the List**: Break down the list into categories to better understand and approach different segments of the market.
• 🔄 **Prioritize the List**: Once categorized, prioritize the list based on the likelihood of making a sale, from high to low probability.
• 🚫 **Avoid Selling to Everyone**: Recognize that you cannot sell to everyone and should focus on the most promising prospects.
• 🍽️ **Example of Pest Control**: The script uses a pest control company as an example to illustrate how to identify and categorize potential clients.
• 🏠 **B2C (Business to Consumer)**: One category is B2C, which involves selling to individual consumers, like homeowners or small business owners.
• 🏢 **B2B (Business to Business)**: Another category is B2B, which involves selling to other businesses, such as restaurants, banks, and commercial buildings.
• 🏘️ **Hybrid Category**: There's also a hybrid category that includes entities like property managers or multi-apartment building owners, who fall between B2C and B2B.
• 📈 **Focus on High-Probability Sales**: After categorization, focus on the segments where you're most likely to make sales effectively.
• 📊 **Develop Targeted Materials**: Tailor your marketing, presentation, and selling materials to the specific market niche you've identified as your target.

Q & A

What does TAM stand for in the context of the script?

TAM stands for Total Available Market, which refers to the entire potential market for a product or service.

Why is it important to develop a profile of potential clients?

Developing a profile of potential clients helps to identify those who are more likely to buy the product or service, increasing the chances of successful sales.

What is the first step in creating a target market profile according to the script?

The first step is to generate a list of all potential people who would possibly buy the product or service.

How does categorizing the list of potential clients help in sales?

Categorizing the list helps in breaking down the market into manageable segments, making it easier to prioritize and focus sales efforts.

What does B2C stand for and what type of clients does it include?

B2C stands for Business to Consumer, and it includes individual consumers such as homeowners, restaurant owners, and apartment owners.

What does B2B stand for and what type of clients does it include?

B2B stands for Business to Business, and it includes commercial entities like restaurants, banks, stadiums, commercial buildings, warehouses, and golf courses.

What is meant by a hybrid category in the context of the script?

A hybrid category refers to clients that fall between B2C and B2B, such as apartment building owners or property managers who manage multiple properties.

Why is it crucial to prioritize the market niches after categorizing?

Prioritizing market niches helps in focusing on the segments with the highest probability of sales, ensuring efficient use of sales and marketing resources.

What is the significance of the term 'Market Niche' in the script?

The term 'Market Niche' refers to a specific segment of the market that a business targets after identifying and categorizing potential clients.

What is the homework task mentioned in the script?

The homework task is to list out potential prospects, categorize them, and then prioritize the market niches to focus sales efforts.

Why is it suggested to focus on residential clients first in the script?

It is suggested to focus on residential clients first because it involves one-on-one selling, which can be more effective and yield a higher return on investment.

Outlines

00:00

📊 Understanding the TAM (Total Available Market) Profile

This paragraph introduces the concept of the Total Available Market (TAM) profile, which is essential for identifying potential customers who are likely to purchase a product or service. The speaker emphasizes that not everyone in the world will buy the product, so it's crucial to develop a profile of potential clients. The process involves creating a list of all potential buyers, categorizing them, and then prioritizing the list based on the likelihood of a sale. The speaker uses the example of a pest control company to illustrate how to generate a list of potential clients, which includes homeowners, restaurants, banks, stadiums, commercial buildings, warehouses, and more. The goal is to find people who are more likely to buy the product, thereby increasing the chances of successful sales.

05:00

🔍 Categorizing and Prioritizing Prospects for Effective Sales

In this paragraph, the speaker continues the discussion on sales strategy by focusing on how to categorize and prioritize prospects. The speaker introduces the terms B2C (Business to Consumer) and B2B (Business to Business) to categorize the list of potential clients. The B2C category includes individual consumers like homeowners and small business owners, while B2B includes larger commercial entities such as restaurants, banks, stadiums, and commercial buildings. A third hybrid category is also mentioned, which includes apartment owners and property managers who manage multiple properties. The speaker suggests focusing on the residential sector for one-on-one selling. The paragraph concludes with advice to identify a target market niche and tailor marketing materials to that specific segment. The speaker assigns homework to the audience to list out potential prospects, categorize them, and prioritize which market niches to pursue.

Keywords

💡Total Available Market (TAM)

TAM refers to the total potential market for a product or service, essentially including every possible buyer in the world. In the script, the speaker introduces TAM as the starting point for sales strategy, but emphasizes that not everyone in this market will be interested in buying the product, so it needs to be narrowed down.

💡Profile

A 'profile' in this context refers to the characterization of potential clients most likely to purchase a product. The speaker compares this process to criminal profiling in CSI movies, where salespeople need to create profiles of prospects to better target their marketing and sales efforts. It is a crucial step to focus on the right audience.

💡Generate a List

This step involves brainstorming and creating a comprehensive list of all potential customers who could possibly purchase the product. In the script, the speaker suggests starting with a broad list, which may include categories like homeowners, businesses, or property managers, and later refining it.

💡Categorize

Categorizing means sorting the broad list of potential clients into distinct groups based on shared characteristics. The speaker provides an example using a pest control company, where the list is split into residential customers, commercial customers, and a hybrid category that combines both.

💡Prioritize

Once the list of potential clients is categorized, the next step is to prioritize them based on the likelihood of making a sale. The speaker suggests focusing on the groups with higher chances of purchasing the product, like residential homeowners, before moving to others with lower probabilities.

💡B2C (Business to Consumer)

B2C refers to transactions where a business sells directly to individual consumers. In the video, the speaker uses this term to categorize potential customers who are end consumers, such as homeowners or small apartment owners, that a pest control business would target.

💡B2B (Business to Business)

B2B stands for transactions where one business sells products or services to another business. The speaker explains that larger entities like restaurants, commercial buildings, and warehouses would fall under this category for a pest control company.

💡Hybrid (B2C and B2B)

Hybrid clients are those who fit both B2C and B2B categories. In the video, property managers and apartment owners with multiple units are given as examples of hybrid customers, as they can function as consumers and businesses simultaneously. These clients may manage or own several properties, requiring pest control services on a larger scale.

💡Market Niche

A market niche refers to a smaller, specialized segment of the market that has specific needs or characteristics. The speaker encourages focusing on a niche once the broader market has been divided and prioritized, to maximize the effectiveness of marketing efforts. For example, focusing on residential pest control might be a niche within the larger pest control market.

💡Return on Investment (ROI)

ROI is a measure of the profitability of an investment, calculated by dividing the return by the cost of the investment. The speaker uses this concept to highlight the importance of focusing on higher probability clients to ensure that time and resources spent on sales efforts yield profitable results. By targeting the right market, a business can achieve a better ROI.

Highlights

Introduction to the concept of TAM (Total Available Market).

Emphasis on the importance of having a clear understanding of the product and its features, benefits, and advantages.

The necessity to identify a target market rather than trying to sell to the entire world.

The analogy of creating a criminal profile to develop a client profile for potential buyers.

The first step is to create a comprehensive list of potential clients.

The process of categorizing the list into manageable segments.

Prioritizing the categorized list to focus on high-probability sales first.

The common mistake of selling to the wrong people and its impact on sales success.

The restaurant example to illustrate the importance of targeting the right audience.

The generation of a list of potential clients for a pest control company.

Categorization of clients into B2C (Business to Consumer), B2B (Business to Business), and a hybrid model.

The strategy to focus on residential clients for one-on-one selling.

The concept of a Market Niche and its significance in sales and marketing.

The homework assignment to list out potential prospects, categorize them, and prioritize market niches.

The importance of focusing on the most effective market niches for a return on investment.

Transcripts

now in this module we're going to get

into what I call the Tam profile Tam

stands for total available market now we

have the right mindset we know what we

want to sell we know what our product is

our services we've gone through the

feature benefits advantages we know what

we have and what we have to offer now we

got to find somebody who'll buy it Tam

again is for total stands for total

available Market which means basically

the whole world but let me ask you a

question question is the whole world

going to buy your product of course not

so what we have to do is develop a

profile of those type of clients who are

more likely than not to buy our product

so what we have to do if you ever watch

those CSI type movies where they're

trying to figure out the profile of the

criminal when this count we're trying to

find the profile of a suspect also known

as a prospect somebody who may buy from

us so the first step is to create a list

let's generate a list of all the

potential people who would possibly buy

our product or service the idea second

is that we then want to take that list

because I'm sure it's going to be a very

big list and then break it down into

categories and I'm going to walk you

through an example of how you're going

to do this but we got to categorize them

and then once we categorize them we

start the big list categorize now we

begin to prioritize our hit list okay so

we have to kind of go through who we're

going to go after first who we're going

to go after second who we're going to go

after third first being high probability

sale third being lowest probability sale

again we can't sell to everybody but if

we find people who want our product the

chances of us selling go up dramatically

now let me take a step back when people

fail in selling it's not because they're

not good at what they do or good at

selling or good at sharing their

information it's not that it's that

they're selling to the wrong people

again let's go back to the restaurant

example if I go to a great restaurant

that serves great stake but I try to

tell convince people or share that

information with vegans for example it's

not going to go over well so we got to

find people who are more likely than not

to buy our product so again let's

generate a list of all the potential

clients we could possibly have that

would buy our product take that list and

let's start chunking them out into

categories once we categorize them let's

go ahead and prioritize who we're going

to go after first second third fourth

and so on I put together a small example

for you to help you walk through this

this will be included in the notes also

now in this example I'm using a pest

control company now let's say that

you're a pest control company and that's

the service that you offer now who could

you sell pest control services to again

we can sell it to the whole world that

would be the total available Market but

let's start narrowing in and generating

a profile so the first is to create a

list so I've created a list here let me

run through some of these see if you

agree with me there's homeowners

restaurants of course Pest Control Banks

may need it stadiums how about community

centers how about commercial buildings

or warehouses how about commercial

office spaces they'll probably need some

Pest Control also right how about some

workout facilities how about apartment

owners property managers may also buy

the service how about a golf course

maybe theaters could be without that

popcorn they might uh storage facilities

M there's a good one uh funeral homes

again the list can go on and on of all

these different places we can sell our

pestol Services too so again now that

we've generated list can we sell to

everybody of course we can't we can't do

that if you don't Focus you'll never win

in selling so what we want to do is

focus so we go to step two which is to

now categorize and start breaking them

apart now I've created three categories

for the list I just read off now the

first list is known as a b Toc list now

let me start introducing new

terminologies here B Toc means your

business B you sell to a c a consumer

it's called business to Consumer you're

a business you sell to a consumer you

consumer you are in a BTO C scenario get

the idea third second scenario rather is

when you're a business and you sell to a

another business that's B2B business to

business the third category is a kind of

combination of both it's kind of B to C

and B2B let me give you an example as I

walk through these three let's again

take our list and the list was again

homeowners restaurants Banks stadiums

commercial buildings so forth and so on

so what I did is I categorize this into

three categories the first category I

call it the B Toc the residential right

pest control services selling the

residential and B Toc would include

homeowners see that's a I'm a business

I'm selling to a homeowner that's a

that's a consumer customer restaurant

maybe individually owned restaurants how

about an apartment owner maybe has four

five eight units whatever ever may be I

am now selling to that person uh let's

say somebody owns a craft store maybe I

can sell them my Pest Control service

that would be B to see get the idea so

that's my first category then I go to my

second category and this is the B2B this

is not residential now now I'm going to

sell to commercial folks and that would

include restaurants Banks stadiums

commercial centers commercial buildings

uh warehouses workout facilities golf

courses as I talked about theaters

stores funeral homes and so for so I

would put those under commercial so the

first category B Toc was residential

sell to individual homeowners or

apartment owners then B2B would be

people who own again restaurants uh bars

commercial buildings warehouses storage

facilities and then the third category

is kind of a hybrid between the two and

that would be apartment owners see some

apartment owners own more than one

apartment building they may own multiple

or how about property managers they

basically manage it for other people

that's kind of a hybrid get the idea so

what I've done is basically created

three different categories B to C B2B

and then a hybrid now then I what I'll

do now is zoom back and say okay I sell

pest control

services where do I have a higher

probability of being able to sell more

effectively and where would I I invest

my time that would be more useful in

terms of getting a return on investment

should I sell to the residents

residentials right B to C should I

basically Focus only on commercial B Tob

or maybe just focus on the hybrid folks

you know the apartment building owners

or the property managers well if it were

mine to do I would basically what first

focus on residential because that's

one-on-one selling and I like that so I

would focus on selling to homeowners

individual store owners get the idea so

by creating three categories I now say

to myself okay I'm going to focus on

this now that I found my target profile

what I'm going to do is develop all my

presentation material all my selling

material all my marketing material to go

after that market Niche now that's a

good word to kind of put in your

vocabulary if you don't already have it

Niche that basically means that you've

taken a whole Market you've cut it up

into pieces you figured out where you

want to sell and that becomes your

Market Niche so your homework right now

is to list out potential prospects

Second Step categorize them and then

prioritize what Market niches you're

going to go after go to it folks