The Biggest Digital Marketing Myth

Sounds pretty cool huh- the biggest digital marketing myth.

But we think it is. It is always wrapped up in fluffy language and lights are shined on it so bright that it is enshrined for ever.

But we need to take a step back and really look at this myth. And the myth?

Market penetration and market numbers.

We all use them and we jump up for joy when we have found an untapped niche. Tons of searches much less competition.

What does digital marketing say:

The word of law in digital marketing states that you find a keyword or amount of people and that amount of people is your audience. Out of that audience a certain percentage buys. Boom...victory!

I remember one example when someone suggested a niche of Labrador dog training products.

Using online info they found that 65-90 million people in the US had dogs. Great!

98000 were registered Labradors in the US.

$150 per month is spent on this breed (on average)

So these owners are spending on the low side $14 million per month on just dog food!

What an easy picking market!

Dog training? Consistent through trends:

The flaw to the digital marketing plan

You can use this thought process on almost all products- especially digital products where the world can potentially be your sales page. Just think of the digital dog training videos you can make- plus ebook.

But the execution and the pay off is usually lacklustre.

But all this assumes one main thing. That you are going to penetrate that market really well.

There is no way that you are going to:

1. get 60-90 million people to buy your product
2. there is no way that 98k people are going to buy your product

Out of these numbers you are going to get a percentage of that. Don't assume that you are going to get 10% either. It is nice numbers and a sizable market. But sizable markets create competition. Those competitors are entrenched and they have brand loyalty. Start with the assumption of 1-5% of a market and monitor carefully and then adjust as the market changes.

Also how many people in reality want dog training videos and ebooks? Some, but not as many as you think. A smaller twist would be how to do "shake paw" or how to practise getting stuff for you- a turn on the idea. And when you do sell your training video then what? You might penetrate 500 people wanting your product, now they have it, what's next? How many more people are being put into this audience that then demand more product? Not as much as the original number.

Then we have the other flaw in our thoughts.

Cost

Having 10 sales a day is great- especially if the product is consumable. Then the amount of customers you require is less. As long as they consume. But again, you have tail off. The amount of consuming repeat consumers reduce over time. Having 10 sales a day for a consumable product is better than having 10 sales per day of having a "one off" product.

But is 10 sales a day really good?

It is, as long as it is paying.

If Ford sold 10 cars a day in the whole of the US then they would be out of business pretty quick. So sales is relative to your start and maintaining costs.

Digital products therefore win on this front as the amount of upfront and continuing costs are much lower.

Consumable items have that continuity cost that really helps. As long as you can pay for:

1. stock
2. advertisement
3. office/ home costs

We also know that consumable customers do reduce in time, so you need further products to maintain income. It is also known that additional products bounce up older products. In other words new products also increase sales of older products.

To persevere?

As you continue though you will find that your brand will start to gain traction and your positioning within consumers minds will also change. Your sales can increase naturally just because you are building your brand and interacting with customers.

But always keep in the back of your mind that total market penetration is difficult if not impossible. So your numbers will not reflect what you assume. Then once you have sold to that new number those customers "have your product". They might not need any more.

The classic example is the fridge. How many times have you bought a fridge? Fridges are now being designed to be new and to incorporate new technology: to be more environmentally and energy friendly. Why? Because buying a fridge is a one off purchase for some years. They have to change. The only way to do this is to incorporate public sentiment on the environment and energy. It is also helpful that fridge's are now incorporating AI technology and smart features. But now you have to figure out:

• how many fridge manufacturers are there?
• do you buy on price, benefits, features or even how it looks within your kitchen compared to other appliances
• are you brand specific?

So we now get defined niches- cost and brand. The top 5 companies in the US have a total market share of 67%.

Are people going to go with a new company or are they going to go with tried and trusted brand?

New will be good if they can disrupt, but it would be costly (or social marketing cheap)- and again once a certain amount has been sold then that company will tail off in sales. Or rapidly if the entrenched brands borrow some of new's ideas (or buy your company if you have enough products and brand identity)

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