Target Market – Topic Overview
In order to have a good foundation for your business, a businessperson must first be willing to identify target market and transform their services to fit their customer’s needs. Given the current state of the economy, technology advancement, and business competition, having a well-defined target market is vital than ever.
The fact of the matter is that no one can afford to target everyone. In a matter of facts, this is virtually impossible. However, with a good targeting campaign, small businesses have the power to compete with big companies that have all the financial backing and excellent human resource.
Small businesses compete with large enterprises by focusing on a particular niche market. A majority of businesses say that they are targeting anyone who is interested in their services, others say they are targeting small business owners, stay at home moms or homeowners. However, all of these targets are too general.
What Is Target Market?
A target market is a particular group of people a company is looking to sell its products and services too. This may include a targeted set of clients for whom it directs its marketing efforts. However, a company must first identify the market, which is a vital step in the development of that businesses’ marketing plan. A target market may be separated from the market as a whole by psychographics, demographics, buying power and/or geography.
For example: assuming that a company ‘X’ is selling sports shoes in a country ‘Y.’ For this company to be successful, they must target everyone who plays or is interested in sports. Therefore, they must come up with a great marketing campaign that will attract this group in that particular country.
NOTE: targeting a particular market doesn’t mean that you are going to exclude those people or customers who are not in your target market.
Rather, target market allows businesspersons to concentrate their marketing campaign on a particular market that is more likely to buy from you compared to the other market. This technique is considered to be more efficient, affordable and effective way to reach potential customers and generate business.
For example, let us assume that company ‘A’ specializes in interior design and decide to apply their marketing technics to homeowners of between the ages of 30 to 50 years, with an income of more than $200,000 in a city named ‘B.’ The business might define the market even further and choose to target only those who are interested in bath and kitchen remodeling.
Through identifying your potential audience, it will make everything easier for you in determining how and where the company will market their products and services.
The million dollar question is; how will a company define their target market? Well, below are few tips that are worth noting.
- Looking At Current Customer Base
The first thing a company must identify is their current customers. In other words, who are your current customers and why do they buy from you? This is a question every business must ask themselves. When they answer this question, then they will be on the right track.
To answer this question, a company must look for common interests and characteristics. Which of these characteristics and interests bring in the most business? It is likely that other people interested in a similar product or service may benefit from your services and products.
- Checking Competition
Another way is by checking at your competitors. Try to find out whom your competitors are targeting. Who are their current customers? While doing this, make sure that you have avoided going for the same market. You may find a niche market that your competitors may have overlooked.
- Analyzing Your Service and Products
The best way to analyze your products and services is by coming up with a list of features for both of your services and products. For example, an interior design company offers the best services. The advantage here is the quality service. A professional interior design company will attract customers because clients will gain trust with the company as well as offer high quality services. Therefore, the quality aspect will make a business successful.
The moment you have completed writing your benefits, make a list of people who may be interested in those benefits. The aim is to come up with a list of people who are looking for that service or product.
For example, an interior designer may decide to target other businesses who are interested in increasing their customers. Even though this technique is too general, at least you now have a place to begin.
- Choose A Specific Demographic
Remember, you do not only have to identify potential customers, but you also need to identify those who are likely to pay for your services or products. For this reason, there are several factors to consider, which include:
This technique will give you an edge on your marketing campaign.
- Consider The Psychographics of your potential customers
Psychographics are the personal characteristics of your potential clients or target market. These characteristics may include:
- Personality and much more
Try as much as possible to find out how your services and product will become part of their lifestyle. When and how will your target client pay for your services and use your products? Which features are more appealing to them? Which channel do your potential customers turn to for information? Does your target read the newspaper and much more? The goal is to know if your products or services will fit in their life. In other words, how will you make your product and service a want for them?
- Evaluate Your Decisions
The last step is to evaluate your decisions to know if you have made any mistake and if your marketing technique or strategy work. This means checking many things such as:
- Is the targeted market enough to fit your criteria?
- Have you understood fully what drives your potential clients or target market
- Can they afford your product?
- How can you reach them?
These are only but few questions you should ask yourself when trying to define your market.