Certain groups of people can create big market

Dwi Bagus Handoko Contributor Jakarta

In today's Internet world a certain type of community can easily and magically transform a small company into a giant world corporation and turn it into a blue chip entity on the international stock exchange, like the Nasdaq.

This phenomenon becomes quite interesting because the above corporation's activities are created due to a customer evolution process that is entirely different from the existing marketing theories or strategies.

What in fact happens is probably just another age-old marketing pattern, which is commonly known as the average market: a market where anything can be offered due to the market's highly heterogeneous character. The difference, however, is that in a community-based market such an impact can be much greater within a relatively short time. This factor probably causes it to be renamed as a new type of market.

There are currently two types of community-based markets. The first type is a noncommercial-driven market, such as the expatriate and alumni associations or political/mass organizations. This category can also be called "noncommercial- created communities". The second type, which is created through the derivatives of commercial activities, such as cell phone and supermarket memberships, real estate residents' groups, etc., is referred to as "commercial-created communities".

The entry point of each group or category is its character and by completely understanding the characters the possibility of making it a potential market is enhanced. There are, of course, some other important approaches to exploit this target market as follows:

Identify the common factor. Every group usually has several similarities or common factors, such as nationality, previous college, ideology, etc. This is to be used by a marketer to make a successful entry.

Identifying common factors that are commercially related is also very vital. This also helps in estimating the group's potential. For example, in the case of the residents of Bintaro Jaya estate, most are young families who own, on average, Rp 300 million houses and make monthly installments on their mortgages of between Rp 2.5 million and Rp 5 million. Their monthly income averages between Rp 7 million and Rp 15 million, and they have children below the age of five.

The next step is to split up the groups to find out each fraction's specific needs and thereby pinpoint a suitable marketing positioning for each. This community's strength is recognized as to be able to further drive product development or even new product launches through its cognitive responses.

Kotler -- a marketing guru -- once said that to make segmentation effective the following five factors are vital: measurability, relevance, accessibility, distinguishability and feasibility. And to get the best results, "keep it within a certain community and clearly identify the members' activities". That's why specific steps are continuously required to optimize end results and to make the group a real market community.

Providing ID cards or creating a membership group are some of the ways to form community-based markets. Matahari department store, for instance, provides its customers with membership cards. The members are indirectly encouraged to "provide a report", since they are rewarded with points or gifts for each purchase. This way the store can easily know the kind of products they often purchase and indirectly find out the customers' reactions to any interior changes or renovations at any counter by checking the number of sales at that related counter.

Publishing a weekly or monthly bulletin is another important strategy in binding them together and keeping them within a certain community group. The giant telecommunications corporation, Telkomsel, does it with its Halo bulletin, while Bintaro real estate publishes Kicau for its residents. Without these marketing tools the communities could dwindle away and turn into ordinary market segments while their true potential would be unexploited.