In order for a business to be successful, you not only need to identify the product or service you will be selling, but you also need to thoroughly research and identify the group of people who will be buying it – otherwise known as your target market.
Your target market is the specific group of people who need the product or service you are selling. It’s who you will tailor your message to, and whose specific needs you will be meeting.
Why is Knowing Your Target Market Important?
A business cannot be everything to everybody. Even if you could do it well, most businesses could not afford such vast specializations in so many areas. Targeting your business to a specific group allows small businesses to compete with larger companies.
Once you know who needs your product or service, you can become the expert in your industry and be more strategic in your marketing efforts.
For example, the medical profession has hundreds of target markets. A general practitioner can provide initial care to address your overall health, but if you had a heart condition, you would want to see an experienced cardiologist who spent years focusing on the heart and who provide you with the most specialized care. If you were having a baby, you would go to an obstetrician. If you needed medical care for you child, you would make an appointment with a pediatrician. One doctor cannot be all things to everyone, just like you can’t offer products and services to every type of customer. No one can know everything about every area. Developing your niche or specialization makes you more successful and effective in your business.
How to Identify Your Target Market
Here are 5 steps to determining who your target market is and how to best reach them:
- Evaluate what you are selling. What unique benefits do your products or services offer? How do they benefit the customers who purchase them?
- Look at your current customers. Where is your business coming from? Where are you making the most sales, and who is buying what you have to sell?
- Identify your customer profile. Study the characteristics of the people who need your product and the customers who are currently buying it. Then create a customer profile. What is their age? Gender? Education level? Geographic location? Income level? Consider psychological information as well, such as lifestyles, behaviors, hobbies, and interests.
- Research the market. Read everything you can online about your target market to determine if it’s growing. Conduct surveys, interviews or focus groups to assess the need, and get opinions from local experts. Research what your competition is offering. Is there enough of a need to support your business?
- Know how to reach your target market. Once you have determined there is enough of a need, find out what websites your target market visits, blogs they read and social media outlets they comment on. Use this information to compose your message and determine the best way to deliver it.
Identifying and studying your target market makes you stay focused, helps you to be more effective in your business, and allows you to develop your niche.
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