How to Locate and Efficiently Reach Your Target Audience?

You’ve developed a doordrop campaign concept with which you would like to reach your target audience. By using the consumer or household characteristics of this target audience in a target group segmentation, you are able to map the zip codes of potential customers for a doordrop campaign. Before I’ll explain more, I’d like to start off with the basics: the service area.

Step 1: Determine the service area

 When setting up a distribution plan for a doordrop campaign, start off by determining the service area(s) of the online or physical store(s). Available zip codes of actual customers give a good indication of the boundaries of the area in which you can reach your target audience effectively. In case of a physical store, customer data can give insight in the distance or time that customers are willing to travel to the store. When a retailer has multiple stores, such an analysis enables you to find the most effective distribution of zip codes between the stores. We often come across cases where a store distributes leaflets in a zip code area where the majority of households choose to visit another store from the same retailer. Besides travel distance or time, the availability of other stores in the area can also play a role in these cases. When transaction data of customers is also available and you would like to restrict the distribution amount, you can take a closer look at the efficiency within zip codes areas. Remove zip code areas from the distribution plan in which the turnover in relation to the number of households or leaflets to be distributed is low. The latter also applies to an online store, where you can choose for a regional or national coverage in the basis.

Step 2: Locate the target audience

 A next step lies in locating the target audience within this or these service area(s). A targeted approach to the consumer is becoming more and more relevant. Letterbox advertising offers excellent opportunities to reach consumers in a targeted manner. With a so-called zip code segmentation you’re able to map households that show a strong match with the characteristics of the target audience. By delivering these households only, your message becomes focused and relevant and you save on distribution and printing costs. In case of multiple target groups, a zip code segmentation gives a breakdown on where the different target groups are (over)represented. The expression and content of printed matter can be adjusted to (differences between) the target group(s) and thereby the relevance of, and response to your advertisement message can be increased.

A zip code segmentation works as follows: On address and/or 6-position zip code level (NL) much information is known about consumers and households. Socio-demographic information as family composition, age, income, car ownership or housing type, but also lifestyle information as hobbies and interests, purchasing behavior and media preferences. By segmenting on specific features which characterize the target audience, the representation of this audience in the zip code areas is mapped. Zip codes in which the target audience is higher represented are assigned a higher class or index. For each zip code you get an accurate insight into the percentage of households that match the target audience. This allows you to compose a distribution plan based on a maximum number of leaflets (the best zip codes are included) or a minimum target group reach. An average segmentation leads to a reduction of half the number of required leaflets, whilst still reaching more than 80% of the target audience.

When visualizing both the customer origin and the penetration of the target audience in the service area you should see a match. We recently came across a case where an overlap was visible for stores in Amsterdam, but not for stores in Rotterdam. Apparently a different target audience needed to be addressed in Rotterdam for the same store offering.

Step 3: Determine the distribution level(s)

In the Netherlands letterbox advertising can be done on four different levels: household, 6-position zip code (both addressed mail), delivery district and/or 4-position zip code (both unaddressed mail / doordrop). The number of households within these levels are respectively one, about 20, about 250 and about 2000. It may well be that a 4-position zip code has a very low representation of the target audience (overall), while there are one or more 6-position zip codes within that show a high representation of the target audience. Therefore, always execute a zip code segmentation on multiple levels and compose your distribution plan based on a maximum reach of the target audience within the most efficient distribution level(s).

  Merel Zimmerman is Marketing and Communication specialist at HPG