24 May 2022 at 6:31:21 AM
One of the first steps in starting a business is determining your target market. This step alone can be the basis for what products you create, how you brand your business and ultimately who you market to. With that in mind, you’ll need to develop assets that resonate with your target market. Start by creating a website that represents your business and uses language and visuals relatable to your audience. Consider what niche you can fit into and what separates your business from the competition. From there you can create messaging, branding and advertising designed for your target market and convert more leads into customers. Keep reading to learn more about defining your target market and gain expert tips on how to implement this targeting throughout your business strategy. What is a target market? Your target market is your product’s primary consumer. Once you know who this is, you can tailor your branding and marketing efforts toward them. A target market can be composed of a broad group, such as married men over 40 in the US, or it can be quite narrow, such as urban, health-conscious, vegetarian women in Texas. Your market will depend on the particular consumer needs your product addresses. The three key aspects of a target market include: Demographics: Age, gender, income, education or employment status. Geographics: Primary location of your market. Personality traits: What they like and dislike, as well as where they shop and their favorite brands. To pinpoint your target market, you’ll need to analyze data about your product niche, your customers and your competitors. Target market vs. target audience Often used interchangeably, target market and target audience are not the same thing. Your target market is the end consumer while your target audience is to whom your company advertises. While your target market might fall into your target audience, who you advertise to may not, in the end, be the one who consumes the product. To clarify, let’s look at an example: Kids toys, for example, have a very clear target market: children. In addition, toys are often marketed toward children who identify with a specific gender category. Nevertheless, kids don’t purchase their toys, their parents do. So toy companies must focus their advertising strategies on parents (the target audience) to sell toys for their kids (the target market). For example, Generation Alpha, kids born between 2010 and 2025 with millennial parents, play with much different toys than their parents did because millennials have different consumer preferences than their Baby Boomer parents. Rather than shopping in big-box stores for brightly-colored toy packages, millennial parents are more likely to purchase clean, minimalistic, and gender-inclusive toys from Instagram ads or Amazon. Therefore, toy companies are using Millennial preferences (the target audience) to sell toys to their Generation Alpha kids (the target market). How to determine your target market Gather consumer data Know your product’s benefits Investigate your competitors Segment your audience Write a target market statement Refine your research 01. Gather consumer data The first step in defining your target market is to learn more about your customers. Even if you’ve just started an online store and don’t have many customers yet, these practices will come in handy further down the line. Start by gathering information about current and past buyers and try to identify characteristics that they have in common. This data will help you market your product to people with similar interests. If you are still in the early stages of your business and haven’t started selling your product, look at competitor markets and use that information to determine your target market. Using website analytics tools, social media and email marketing analytics platforms, here are some data points you’ll want to consider: Age: Do your customers share a common decade or generation? Are they millennials, older adults, or something in between? Location: Where in the world do most of your customers live? Consider the different cities, countries, and regions. Language: Which languages do your customers speak? Remember that your customers’ language isn’t necessarily the dominant language of their country. Spending power: Consider socioeconomic factors that may be affecting your customers. How much money are they willing or able to spend? Hobbies and career: What do your customers enjoy doing? What are their professions, and what do they do in their spare time? Stage of life: Where are your customers in life? Are they college students? New parents? Retirees? If your company is B2B rather than B2C, you’ll want to look for characteristics of companies, rather than individual consumers. These traits include: Business size: Are the businesses that buy from you small, medium, or large? Location: Where are these businesses physically located? Vertical: Which industries are most of these businesses in? Budget: How have these businesses raised money? Consider how much they’d be willing or able to spend on products like yours. Be sure to track this information in an orderly manner so that you can keep your findings organized and easily identify trends. Analyzing these trends will allow you to identify shared characteristics within your customer base. These characteristics will inform your inbound marketing efforts and steer your strategy toward your target audience. 02. Know your product benefits The next step is to understand your consumers’ motivation behind purchasing your product, rather than a competitor. You can learn this information by speaking to your customers directly, asking for testimonials, and by doing in depth competitor research to understand the difference between your product and theirs. Get to know the benefits—and not just the features—of your product or service. The features are your product’s characteristics. For example, if your business sells suitcases, you might describe your product as being small, compact and having multiple compartments. Your product’s benefits, on the other hand, are the advantages it brings to your customers. Think about how your product makes someone’s life better or easier. The compact, multi-compartment suitcase offers the benefits of being easy to carry and pack as a carry-on. It’s vital to understanding how your product fulfills its target market’s specific needs. For the suitcase company discussed above, for instance, the target market would be people who benefit from a lightweight, carry-on suitcase—such as business travelers who take short, frequent trips. 03. Investigate your competitors Hone in on your target market even further by taking a look at which your competitors are targeting. Of course you won't have access to their customer analytics data, but you can understand their customers with a SWOT analysis. Take a deep dive into competitor websites, blogs and social channels. Consider who their target market is based on their website content, content marketing strategy, and social media branding. You’ll likely be able to infer details about their audience based on their brand language and tone. You can also check for comments on their social media pages to see which types of people are engaging with their posts. Take an especially close look at their most successful social media and blog posts. Do these pieces of content have anything in common in terms of their offering or branding? Which interests or needs do they address? Use this information to consider what kinds of qualities or advantages appeal most to consumers within your industry. 04. Segment your audience At this point, you’ve gathered some information about the characteristics and interests of your target audience. Now, it’s time to use that information to clearly define your customer types. This is going to form the basis of your target market. The best way to do this is through market segmentation. This involves dividing your customers into different groups, or segments, based on their shared qualities. You can divide your customers based on: Geography: Physical location, whether it’s your own city or a different part of the world. Note that if your customers are located around the world, you may need to create a multilingual website, as well as localized ads and marketing materials. Demographics: Characteristics such as age, gender, race or ethnicity, income level, or marital status. Psychographics: Inner qualities such as personality, lifestyle, or personal values. These are often a product of geographic and demographic factors such as location, generation, or stage of life. Behavior: Perceived qualities based on online behavior, such as buyer readiness or frequency of use. If you’re a B2B company, use similar characteristics but apply them to business. Consider firm demographics—known as firmographics—such as industry, location, customer size, business structure, and performance. To gain a deeper understanding of your segments, you can also create buyer personas. Also called user personas, buyer personas are imaginary characters with traits and behaviors similar to those of typical customers. Ultimately, these fictional characters represent your target market, helping you gain insights into the needs, desires, and lifestyles of your actual customers. 05. Write a target market statement Now that you’ve determined the defining features of your audience, it’s time to put your findings on paper. Write a target market statement that focuses on the most important audience characteristics you’ve identified in your research. Your statement should include: Demographic information about your target market, such as gender and age. Geographic location of your target market. Key interests of your target market. Then, sum it up in a single sentence. For example: “Our target market is women in their 30s and 40s who live in the United States and enjoy casual, comfortable fashion.” Doing this will keep your brand identity and marketing efforts consistent. It will also come in useful as you adapt your company’s mission statement to be as relevant as possible for your audience. 06. Refine your research Defining your target market is based on thorough research, but that doesn’t mean it’s going to be perfect the first time around. Even after you identify your market, you’ll still need to continually test and experiment to get an increasingly precise picture of your customers. Staying on top of your market research can also help you keep up with the times, as consumer interests change over the years with technological developments, generational attitudes and passing trends. To narrow in on your audience, you’ll need to assess your business success and test your targeting efforts. Take a look at who is actually buying from you and which specific products or services they are purchasing. Try to understand how you can adapt future product development or modify your branding or marketing efforts to better fit your customer base. Utilize A/B testing with your marketing efforts to test the same ad on different audiences and see which version performs better. Alternatively, you can develop two different creatives, each with their own look and language and compare your audience’s responses. Based on the results, you might need to either adjust your business strategy or revise your target market statement. The bottom line is to build a brand that resonates strongly with your audience. Remember, the more targeted your content, the more effective your lead generation strategies—and the more customers you’ll bring to your brand.
What is a Target Market and How to Define Yours