Every business wants to have a target market large enough to generate a steady cash flow. But many of them cast their nets too wide and end up failing.
Don’t try to appeal to everyone at once. Instead, think about how to attract and keep customers who will buy from you frequently.
Throughout this article, we will clarify what it means to have a target market and a target audience. This will help you grow your business into an empire.
By identifying the ideal customer for your business you will be able to build a brand you can be proud of.
Target Market Definition
As a business owner, you’ll hear the term “target market” almost every day. Do you know what it really means?
Basically, a target market is a group of people who will buy your products or services.
Knowing your target market helps you to tailor your products accordingly. Thus maximizing the effectiveness of your advertising dollars.
It prevents you from wasting money on people who aren’t interested in your business.
A target market is usually defined by three factors:
- Your buyers’ demographics include their age, gender, income, marital status, etc.
- Geolocation: Where your customers are (could be entire continents or a specific neighborhood).
- Customer psychology: What drives your customers? Describe their preferences. How can you help them?
Knowing Your Customers
Knowing your customers can help you market your products more effectively.
The target markets and target audiences are often confused and overlap. But they represent different people, and making the distinction is essential.
As an example, consider a market that targets children. For instance, KFC’s Kids meal.
The product is clearly for kids, but the target audience would be parents. Usually, these adults choose what the kids eat and purchase Kid’s meals.
KFC’s ads tend to focus on things that don’t pertain to the target market (kids). Take nutrition for instance.
To put it differently, your target market is the buyer you’re aiming for. A target audience is a person you plan to advertise to.
So now you know the difference between a target market and a target audience… but what is the point? Don’t you have more chances to snag customers if you market to everyone?
Narrowing Your Audience
A wide net is not always the best way to catch fish. With a large net, you might capture a few valuable fish, but you’re more likely to find a barrel of unsalable fish.
A truly successful fisherman must use the right bait, equipment, and fish in the right places.
This metaphor of casting a large net applies perfectly to the world of marketing.
You will attract more customers if you focus your efforts on a well-defined market.
Establishing your target market and audience early on will help you:
- Create products that meet specific needs
- Determine the right price
- Decide on the best mediums of marketing
- Identify the best features to emphasize
- And much more.
Also, narrowing your market and target audience will also prevent you from casting a wide net too far. Thus enabling you to convert more potential customers with fewer overhead costs.
Defining your target market might seem overwhelming at first. But if you break the process down, choosing the right market segment isn’t difficult.
By targeting a specific group of people it’s easier to market to them. Your audience will be more likely to buy your product or service if your message is clear.
A well-defined audience also enables you to have more meaningful conversations with them. Develop a relationship with customers to enjoy loyal customers and word-of-mouth recommendations.
How To Identify Your Target Market
To identify your target market, consider the following:
1. What Value Do You Offer?
Outline your business’s key benefits to identify your target market fast.
To identify the key benefits of your product or service, consider the following:
- In what ways do you help people?
- Whom do you serve?
- Are you fulfilling a desire?
2. Who Will Appreciate The Value Offered
The next step is to identify who would benefit most from these features. And also, who would be most likely to buy your product or service. Knowing this will help you narrow your target market.
Select the audience your offer will benefit most, then narrow your choices.
Think about the critical demographics of the market segment you have identified.
3. Pinpoint Your Target Market
It’s easy to know who’ll benefit from your business by identifying your ideal customer.
In addition to demographic information, you must consider psychographic information.
Your market segment’s psychographics includes more personal information. For example:
- Passions and interests
- Typical routines
You can collect these details by a variety of means. Businesses can gain a lot from asking existing customers for feedback. Other than that, surveys, polls on social media, or any form of market research can be useful.
4. Maintain Your Focus
This is possibly the most challenging step when defining your targets. But, it is also one of the most important.
Stay focused when analyzing your potential customers. Especially when matching your product’s key benefits with a specific audience.
Unless your product addresses a need, desire, or want accurately, you will fail, no matter how great it is.
Just because someone says they will buy your product or service doesn’t mean they will.
Here are a few questions to ask yourself:
Can the company be sustainably run with this size of the group?
Is the market segment able to afford the products and services being sold?
Do these people make many purchases? Or will you always need to attract new customers?
Do other brands share the same market segment? If so, why?
What makes your company, product, and service unique?
Are you able to reach your target market?
Research into this will need to be followed by real-life testing with the target market.
6. Who Controls The Spending
After you’ve determined your target market, it’s time to focus on your target audience.
Your target market is the group of people who would buy your product. The target audience is the person who will make or influence a buy decision.
For instance, children can’t buy products for themselves. So products for children should be marketed to their parents or guardians.
Still, buying decisions do not always occur in a vacuum but occur in many other contexts.
Don’t forget the friends and family of your target customers.
What impact would a review from a sibling have on a potential customer’s decision to buy?
Would your customer want to consult their partner before making a big-ticket purchase? Do you know how to convince these ‘influencers’ to buy from you?
When you provide products and services to B2B clients, this can be even more complicated. Several people may need to approve a purchase.
7. Competitive Analysis
It is imperative that you analyze your business strengths, weaknesses, opportunities, and threats. Next, make sure you’ve done the same for your competitors.
Who are your competitors targeting, and what are their marketing strategies? How does your audience react to your competitors’ efforts? Are your potential customers’ needs being met? If not, why?
But answering these questions you’ll know what is needed and what you should provide.
What is a Target Market? Real-Life Examples
Let’s take a look at some well-known brands to see what their target markets look like. Let’s begin with a popular one, Nike.
Using Nike as an example, we can see where target market demographics are important. With the Just Do It campaign, Nike expanded its audience t be more inclusive.
In its rebranding, Nike took into account who would benefit most from its products.
The company targets young people, fitness enthusiasts, and those with some disposable income.
Nike advertises to self-motivated young athletes and fitness enthusiasts.
You might notice that someone else’s Netflix account looks different from your own.
Using algorithms, Netflix targets its audience based on their preferences. Allowing them to offer a more customized experience.
The company began as a DVD rental service that mailed DVDs to customers.
With online streaming taking off, Netflix decided to offer an online service. The service now offers apps and downloadable, offline shows and movies. A;l highly tailored to individual preferences.
This footwear brand targets a specific demographic with its cool and quirky design. With a daring approach to shoes, Vans appeals to rebels.
The brand may not be for everyone, but it’s specific enough that rebels worldwide can’t get enough.
The company ensures its products match the expectations of its customers.
Developing a Target Market Plan
As a final thought, we thought you might find an example of a detailed target marketing plan helpful.
Here’s what our target market plan often looks like:
- Age group: 30-50 years old.
- Gender: 70% Men
- Job Positions: CFO, Digital Director, Marketing Manager
- The following values matter: Job security, affordability, and financial growth
- Prepares full pros/cons analyses before making decisions after reviewing all data
- Maintains a balance between work and family
- Skeptical of any brand or offer that claims to solve all their problems.
Challenges and pain points:
- They are worried that current software is too complicated to use and costly.
- Lack of design skills and tired of spending money to hire designers.
- Stressful work environments do not allow for work/life balance.
Preferred communication channels:
- Using emails
- Social Media platforms such as Facebook or LinkedIn
- Keep abreast of industry news by checking Facebook groups and profiles.
- YouTube/Training Videos
- Case studies
- Online Courses
You now know how to find your target market. And how to differentiate a target audience from a target market. Plus you have a full understanding of how to write a target market strategy.
If you follow this advice, you should be able to attract and maintain a loyal customer base.
Identifying your ideal customers is only the first step. Having identified your target audience, focus on the mediums of marketing they use.
Google Analytics is a great tool for determining where your target market is.
Just ensure your landing and opt-in page reflects their interests.
You’ll experience unprecedented market growth after you’ve done this.
Target markets are segments of people who are likely to benefit from your business. Depending on your marketing needs, you can break this group up into as many smaller segments as you like.
In general, target markets are based on key demographics, such as age and gender. Then, they are narrowed down with psychographics, such as likes and dislikes.
The people you are selling to are your target markets. Your target audience, on the other hand, is the group of people who make the buy decision.
For your product or service to be successfully marketed, research is essential. Your existing customers are an invaluable resource. Using social media polls, surveys, and emails can help you pinpoint your target market.
Google Analytics is a valuable tool for determining your target market. With this tool, you can see where your audience spends their time. And what keywords they search for relevant to your messaging.
Lastly, to create a target market plan, be sure to include:
- Age group
- Identify the gender
- Occupational title
- Pain Points