What Is Target Market? 5 Questions To Define Yours
Did you know you need a target market to hit a bullseye in business?
You probably know that it’s impossible to create a company or service perfect for everyone. As much as you’d probably like the whole world to know about you and your business, it’s unrealistic, and not to mention, expensive!
Plus, not everyone may need your offerings, so spending time trying to gain mass appeal might end up in a lot of advertisements falling on deaf ears.
The best way to gain a competitive edge is to target a niche market: the customers who would be the most interested in using your products or services. With a clearly defined target market, it becomes easier to determine where and how to market your company.
Before you begin targeting your market, you’ll need to understand what that means and where to find that information. What metrics do you need to know? Where should you focus your energy? And importantly, how can you do this without breaking the bank?
Below, we address some frequently asked questions about target markets to help you understand this niche aspect of marketing and draw more eyes to your company.
1. What is a target market, anyway?
It’s simple, really!
A target market is the segment of consumers who are the most likely to want or need your product or service. It’s a subset of your business’s total market, so it does not represent all of your existing or past customers – just that group who is most likely to use you.
For example, if you are running a small photography studio that specializes in family portraits, your target market would be adults with children who are looking for professional photos for greeting cards, invites, home photos, and more. This doesn’t mean that only adults with children have used your services, but they are the most likely group to keep using your services.
Break It Down
It’s also important to keep the terms “target market” and “target audience” separate. Your target audience is even more narrow than your market – those are the consumers who have made a purchase, or are likely to purchase soon. Your market is anyone who may be interested. There’s typically an overlap, as you want members of your target market to become your target audience, but it may not always happen.
Identifying a target market means focusing your marketing efforts, and the way you craft your messaging, to appeal to a certain market that is more likely to use your product or services. These efforts may draw in more than just your target market, and that’s great! But by streamlining and efficiently crafting messages with a certain user in mind, you’re more likely to seem approachable, relatable, and trustworthy.
Don’t Make it Complicated
You can want to sell to everybody and your product can benefit everybody, but until you identify your most likely target, you’ll struggle to benefit anybody.
An apple tree has apples growing all over it. When you approach an apple tree, you don’t say, “I’m going to get all of those apples.” Even if you are going to pick a bucket of apples, you still focus on one. Only after you pick the one do you then focus on the next one.
When it comes to your target market, start with one.
2. Why should I find my target market?
Target markets also help you gain a better understanding of your current and potential consumer base. By spending a little bit of time defining your target market, you can attract new customers and increase your profits, as well as streamline your marketing efforts. You’ll use fewer resources and time marketing to consumers who are unlikely to be interested in its products. This is especially important for small, startup, and niche businesses with smaller marketing budgets to help compete with bigger companies.
In the sales world, this would be labeled “qualifying a lead.” The more you qualify who you address, the more you will be positioned to meet their needs where they are.
Once a target market is identified, it can also affect the way you price, promote, and frame your product or service.
For example, let’s say you run an online resale clothing company that appeals to all shoppers, but you notice most of your customers are women 35-50 with a higher income. You learn that customers in this demographic prefer a personalized shopping experience and wearing their purchases out to social events. Because of this, you begin offering personal concierge services and individualized customer service support. You also start tweaking your copy and advertisements to mention how perfect your clothes are for their next night out. With a few tweaks, you’ve just created a target market, with strategies now to keep that most active demographic coming back to your store.
What is the easiest way to find my target market?
With a few smart strategies and understanding consumer behaviors, you can start the process of finding that niche group to focus your efforts on. Here are some easy ways to get started:
Start with your existing customers.
Take a long, hard look at the people who already buy from you. Even if your current customers seem like a diverse bunch, the chances are that they have some common characteristics. If they don’t have a lot in common, perhaps there’s a shared interest – after all, they all chose you instead of your competitor.
- Are you an eco-friendly company?
- Are you a woman or a minority-owned business?
- Is there a cause you are passionate about?
These all might be factors why a seemingly diverse group of customers choose your business and can be your selling point. Once you begin to identify commonalities between your regular customers, you can begin to use this information to refine your existing customer base into a target market.
Analyze your product/service.
Write a list of the features of your product or service and the benefits of each of those features. For example, a graphic designer who offers high-quality design services will make their clients look professional and trustworthy. Therefore, a high-end designer will likely increase sales for their client – an added benefit. So, this graphic designer could choose to target small businesses interested in gaining a reputation and trust among new clients. This is just one example; once you start realizing all of the benefits of your product/service, who you target will become clearer!
When first finding your target market, you’re likely to look broadly. That’s not a bad starting place, but you should try to get granular. For example, instead of just marketing to small businesses, which sector of small businesses would most need your product or service? Remember, you can have more than one niche market, and your messaging is likely to be different for each one. By tailoring your messaging for each market, your potential customers will feel like you’re reading their minds!
Check out your competition.
It’s another easy but effective method for defining your target market. Peek at your competitor’s ads, messaging, website, and so on. Who do they appear to be targeting? Who buys their products, and why do they choose their products over yours? These questions can seem scary to face at first, but should ultimately motivate you and in the long run, save you time, as you can learn from your competitor’s efforts.
What data should I look at to find my target market?
Here are some of the common metrics you can examine to help you narrow down your market:
Demographics describe your target market in terms of categories like their age, gender, employment status, education level, family structure, and income. For example, your target market could be college students who live at home, women 40–50 with a yearly income of at least $50,00, or retired men without children. These are all different descriptors you could use to label the niche aspects of your target market.
Geographics describe the physical location of where your target market resides. Consider if this niche market is nationwide, international, or tied to a certain rural, suburban, or urban environment. Do they drive or commute? Do they rent or own? Also, consider whether your product is region-specific or can be used anywhere. Would people be likely to travel with your product/service, or give it to someone? These are all questions that can narrow that niche field.
Psychographics describe the personal qualities of your target market. This means hobbies and leisure activities, entertainment interests, other products they buy, even how they search for information. What media do they consume? Where do they get their news? Do they attend certain venues or restaurants more often than others? All of these questions will help you consider how your product/service fits into their lifestyle.
Behavioral patterns help define your market’s purchasing habits. What do they often look for in their products? Are they more concerned with a good price, or good quality? Are they always searching for the latest trends and tech? Importantly, how often are they likely to purchase or use your company’s product/service again? This can help you determine whether certain niche markets are worth your effort.
How do I reach my target market?
Once you’ve done the work of researching your target market, you’ll likely want to start implementing strategies right away. After all, how effective is knowing your target market if you don’t do anything with that information? The good news is that the hard part is over, and it’s much easier to tweak existing marketing strategies to your new target markets. Here are a few common marketing methods you can use to get started:
Blogging. It’s one of the simplest and most effective ways to drive traffic to your website. This is especially because Google search algorithms favor websites that update frequently with high-quality, relevant content. Blog posts let you tailor information to certain groups as well, which can be helpful if you identify several niche markets. The more high-quality blogs, the more opportunities for your target market to find you and interact with your site, and the better exposure you’ll get.
Mailing lists. Though email seems outdated sometimes, it’s still a very useful tool for reaching customers. If you build a list of interested people, you can provide them with regular updates and describe features of your product/service that will appeal to them. You can also group emails into separate newsletters with specific focuses, depending on the markets you define.
Social media. One of the most cost-effective marketing strategies for growing a new business is definitely maintaining a social media presence. Though it’s always free to post, it’s often very affordable to boost posts, create ads, and pay for sponsored posts. Sponsored posts can work wonders, as you can partner with someone in your niche target market who can describe in their own words why your company is so great.
Coupons and discounts. Telling your customers how they can save money is always a way to get their attention, especially if the market you identified is one that shops on a budget. Offering discount codes via email, social media, and website pop-ups are easy ways for curious potential customers to feel like they’re getting an exclusive.
Go Find your Target Market!
Now that you know what a target market is, why it’s important, how to find and market to them, what’s stopping you? Take some time today to begin listing the features and benefits of your product/service, as well as reviewing your customer history and observing trends. This will easily give you insights into where you should focus your marketing efforts. With a bit of strategy and focus, you should easily see the benefits of segmenting your market for greater return.
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