Why Define Your Target Market?
With the rise of businesses conducting themselves almost entirely online, the need for having a well-thought-out target market is more imperative than ever. No business can target everyone, nor would it be cost-effective to do so. However, your small business is more than capable of competing with large organizations; you need to target a specific market.
Many owners of small businesses say they target homeowners, for example, or parents. These targets are far too wide-ranging, and marketing to these sorts of groups is unlikely to bring in a substantial return. Plus, it’s not that you’re writing off other groups of people. It simply means that you spend your money and time investing in a target group that is more likely to show a good return.
For example, to target your marketing as ‘shoes for women’ would be too broad. However, ‘shoes for vegan women’ or ‘shoes for transgender women’ are far more specific and can tap into a niche market. This makes it much easier for you to decide how and where to market your business products or services. To work on a marketing strategy for your product, read some demand generation guides. Working with this target market doesn’t mean that women who aren’t vegan, for example, won’t buy your shoes, but it gives you a starting point.
Step 1: Examine your existing customer base
Who are your existing customers, and why do they purchase your products or services? Try to identify shared interests and characteristics. Which customers tend to be the most profitable? Other people who share those common characteristics are likely to be potential customers for your business.
Step 2: Research your competition
Who are your competitors? To follow our example, find out who else is selling shoes similar to yours. Who are they selling to? Which target market are they working with? Try not to target the same market as them. But you might identify a niche to tap into.
Step 3: Select specific demographics
It is helpful to work out who is most likely to purchase from you and who may need the product or service. Consider the following:
- Education level
- Marital or family status
- Ethnic background
Step 4: Think about psychographics
In addition to personal characteristics, it can be helpful to consider the psychographics of your potential customers. These might include:
Try to think about how your product or service will integrate into your customer’s lifestyle. When might they use the product? What about the service is attractive to your target customer?
Where does your customer go when they need information? Do they attend events or join Facebook groups? Do they purchase newspapers? Getting your head around these kinds of questions can be helpful.
To find this sort of information, means yet more research. Try an online search for research that has previously been carried out about your target. Hunt for blogs and articles either by or aimed at your target market.
There may be online forums and groups in which vegan women discuss their lifestyle choices. Pay close attention to these and join them if possible. Also, ask your existing customers for feedback can give you a whole wealth of helpful information.
Remember, when researching and deciding on your target market, your research will pay off. Now you know how to define the target market.