Tips on how to define your business’ target market
It’s impossible to be all things to all people, and this absolutely holds true for your business. It’s crucial to your company’s success that you’re able to identify and meet specific customer needs and effectively communicate this. A small business can compete with the global giants if they precisely target specific niche markets.
You’re targeting to focus your precious budget on communicating your brand to a market that is more likely to make a purchase. This will affect decisions over how you position your business including how you price, package, market etc. and will help your business grow much more effectively.
Here are some tips on how to define your target market.
Your product/service. Create a list that focuses on each feature of your offering. Then you can really start examining the benefits each one provides. This is, of course, a very general initial step, but the people you identify whose needs are met by the benefits you offer are a good base with which to start off from.
Your current client base. What can you learn from your current customers? Why do they buy from you and which ones bring you the most business? Are there common threads that link them? Characteristics that you can pick out to use to identify other people who might also benefit from your offering? What are they saying online in reviews and on social media? You can even ask them directly for feedback.
Your competition. You can also learn a lot from who your competitors are targeting. Not necessarily as a way of going after the same market, but as a way to identify potential niche markets that they have missed. What channels do they operate in and do they have gaps in their offering that you already fill or could potentially move into? How are you differentiating and what’s your USP?
Specific demographics. The devil is in the detail, as they say, and you need to not only establish who has a need for your offering, but also who is most likely to purchase. Whether it’s Facebook advertising, Google Adwords or, most likely, a combination of several avenues, all will allow you to target based on a wide range of demographics and provide valuable feedback on the type of customers you are attracting.
The key to gaining good value is in having a strong understanding of the key demographics in your market in relation to your offering. Below are some to consider tailoring your marketing to:
- Ethnic background
- Marital status
- Income level
- Education level
Personal characteristics. After establishing your base, it’s time to drill down further and establish how your product or service will fit into your target’s lifestyle. To stimulate thoughts and ideas, you can ask the group a series of questions such as “What would the user be thinking & feeling? What are some of their worries and aspirations?” etc. Here are some more traits to formulate questions around:
With the results from this process, you want to start building a customer persona that is essentially a detailed representation of your target customer.
Evaluate, test, iterate
Time for Sherlock’s pipe! As you contemplate your selection, first consider if you have sufficient people in your target group and whether their need is met by your offering. Also, can they afford your product and are you able to find ways/channels to communicate to them?
If you answer these questions positively, now is the time to put aside a small percentage of your budget to test your marketing strategy and analyse the response, iterating and refining your target until you are confident enough to put more budget behind it.
Finally, it’s important to remember that this is a fluid process and you will need to continually monitor your performance and make adjustments to maintain efficiency.