Posted by: Daisy | November 8, 2008

This isn’t politics

So, we were sitting around chatting when of course politics comes up.  It seems the presidential election is great fodder for discussion.  However, it reminded me of a discussion I had many months ago.  I was talking to a person who shall remain unnamed (surprise surprise – I don’t name anyone on this blog) and the discussion was regarding who our customers were, and how to reach those customers – you know, marketing stuff.  This person who is more senior than me, has a lot of difficulty with marketing in general, and doesn’t really get it, shall we say. 

What was generally accepted at the company is that the target market for this company’s customers are mid-high affluence households (amongst other details which are irrelevant to this post).  So, one data point is their household income is higher than most. 

The discussion we were having revolved around the idea that the company didn’t really know who it’s customers were – okay, let’s get real – that was my point of view.  It seemed that sometimes, the company wanted the target to be everyone with a pulse (okay, I exaggerate) and yet wanted them to pay a premium which some (many?) could not afford.  I basically said that we had to choose one and stick with it – are we low volume, premium price and service, or high volume, low price and service? Trying to be high volume, high price is a formula for failure.

When the discussion around price and target market came up, I reminded this person that when we say the richer folks (mid-high affluence), that that is in relation to the entire population.  I reminded him that he and his cronies (I mean, his friends) are not the average Joe.  The people we surround ourselves with tend to also be atypical in that we are well-educated, in management, and likely own assets like a home (with a mortgage of course). 

He had trouble with this concept, so I began to throw some data towards him (he likes data).  The median household income (ie, two income earners in many families) of Canadians is just under $54,000 in 2005 according to Statistics Canada.  I assure you, that number has not moved significantly.

I don’t know about you, but $54,000 doesn’t sound like a big number for 2 income earners, yet that is the median, so 50% of the population earns more than that and 50% earns less.  You can’t argue with that.  You can even split it out by urban vs rural and the number is still much lower than you’d expect in even big cities like Toronto full of educated people.

I reminded him that when I call them the rich folk, they aren’t what I’d consider rich.  We’re not trying to talk exclusively to people with nannies, cooks, butlers, 3 cars and a boat.  Those are a whole other set of niche folks.  Our customers are really just average-ish.  They’re not that rich.  They’re just rich compared to the entire distribution of people.

They own homes.  They’re above average already if they own a place.  He had trouble understanding that even the ‘poor lady who owns that tiny house in the okay neighbourhood’ is considered ‘rich’ compared to others.  Why?  She owns the place.  That’s a lot more than can be said about the many others who struggle.  It reminds me of the sheer volume of people who work the tough jobs in retail, and others who get paid a bit more than minimum wage.

He easily forgets and I’d venture to say that I don’t think he actually understands still, the idea and the data behind it.  He thinks that everyone owns multiple properties or that it would be within their grasp and has no idea what living on $30,000 would mean.  You do the math – two incomes at 30,000 would be more than the median of $54,000 – that’s a mid-affluence family right there. 

So what’s my point.  I guess some people just don’t have a clue – I think the word that comes to mind is ignorant, and if you’re ever in a leadership role with power, you can not lead effectively, if you don’t know what the vast majority of your people’s day-to-day lives are really like. 

I guess that’s how it comes back to politics.  But this post isn’t about politics.  It’s just about ensuring your assumptions are correct or else you may make some very strange conclusions that will make you look like a fool.

– Daisy

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Responses

  1. I have tagged you, if you want to play

    Thanks. Mrs. V also tagged me and I checked my 6th of 6th and I can’t post that photo – it’s a photo of other people’s kids at a b-day party and well, I’m so secretive and all.. ha ha. – Daisy


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