In last week’s blog, we looked at why it is important to define your target market. Primarily, it’s important so you fully understand your core customers, so you can make sure your products, services, and messages are appealing to them. In this week’s blog, we’ll look at how to define a target market.
Analyse Your Current Customers
If you are a start-up you’ll need to skip this point but if you have existing customers, start with them. Describe who they are and look for things they have in common. For example, are most of your customers male or female or, if they are business customers, are they from a particular market sector? Which groups of customers are most profitable?
Research Your Competition
Looking at what your competition can also help, particularly if they have a specific tone and message in their marketing. This will give you an understanding of who they think their target market is, but that doesn’t mean you should copy them. In fact, it might be beneficial to target a different group of customers.
Understand How Your Products/Services Solve a Problem
This part is crucially important. It involves looking at your products and services and thinking about how they solve a problem for your customers. In other words, considering the benefits of your products/services rather than the features and what they do.
It’s important to always remember that customers don’t buy from you because of the great features you offer. Instead, they have a problem and you have the solution. Examples of customer problems include anything from deciding on the style of car they want to buy to reducing costs in a business to getting a quick bite to eat at lunch.
What You Want to Discover
When going through the above for B2C customers, you should try to clearly answer the following:
- How old are my customers?
- Where do they live or work?
- Are they mostly male or female, or is there a mixture?
- What is their income bracket?
- Are they single, married, have a family, retired, etc?
- What is their occupation?
- What level of education did they achieve?
- What type of personality and/or attitudes do they have?
- What are their values?
- What lifestyles do they lead?
- What are their interests and hobbies?
For B2B customers, you should try to answer as many of the following as possible:
- Where is the business located?
- What industry is the business in?
- How many employees does the business have?
- Who are their customers?
- What type of business are they – start-up, established brand, growing company, etc?
Do a Double Check
Once you have answered the above questions, you will have a defined target market. You then need to do a reality check to make sure the market is viable:
- Market size – are there enough people in the market?
- Is it too specific or broad – in other words, is it so specific you risk alienating other customers, or is it so broad there is little value in having the defined target market?
- Reach – can you reach the target market? This applies both practically (is it possible to reach them) and financially (do you have the money to reach them)?
- Price – can they afford your products/services, or will they think your products/services are too cheap?
Finally, don’t make this exercise a one-time thing. You don’t need to constantly redefine your target market, but it is beneficial to continue learning about your customers and refining the description of your core audience.
In next week’s blog, we’ll look at what you should do once you have defined your target market.
If you want any other advice or help with your business, please don’t hesitate to call a member of the Gilroy Gannon team today.