Target Market is the most important thing when you want to launch and establish any business otherwise you might not get any results from your marketing efforts. Ensuring that you research your target market ensures that the logo and branding you are developing will appeal to your potential customers and/or clients.
The basis of all good marketing can be established from the following three questions:
- Who are you?
- What do you do?
- Why does it matter?
In order to differentiate yourself from the million other companies, businesses or freelancers within your chosen industry you must show your positive attributes, appeal to the target audience and above all stand out from the crowds.
Focus, Focus, Focus
These are the three most imporant words in branding. The danger is rarely too much focus, but too little. An unfocused brand is on that’s so broad that it doesn’t stand for anything. A focused brand, by contrast, knows exactly what it is, why it’s different,a nd why people want it. Yet focus is difficult to acheive because it means giving something up. It runs counter to our most basic marketing instinct: If we narrow our offering, won’t we narrow our opportunities for profit? Anwer: Not necessarily. It’s often better to be number one in a small category than to be number three in a large one. At number three your strategy may have to include a low price, whereas at number one you can charge a premium.
History has shown that it pays hansomely to be number one in your category – first, because of higher margins, and second, because the risk of commoditisation is almost nonexistent. Yet number two can also be profitable, despite a smaller market share. Number three, or four, or five, however, may only be wort the effort if you think you have a realistic shot at becoming number two someday. Can’t be number one or number two? Redefine your category.
Competition forces specialisation. The law of the jungle is "survival of the fittest," and the smart company doesn’t wait to be foced. In the competitive world of cars, for example, Volvo built a strong brand when turning its heavy, boxy vehicle into the "safe" alternative, a market niche they were able to own and defend for many years. Was that good enough for Volvo? Apparently not, because they’ve recently added fast, sexy vehicles to their lineup.
How do Define your Target Market
With the current state of the world economy, having a well-defined target market is more important than ever. No one person can afford to target everyone. Small businesses can effectively compete with larget compabies by targeting a niche market. Many businesses say they target "anyone iterested in my services". Some may say they target small business owners, home owners or stay-at-home mums. All of these targets are too general.
Targeting a specific market does not mean that you have to exclude people that do not fit your criteria from buying from you. Rather, target marketing allows you to focus on your marketing dollars/time and brand message on a specific market that is more likely to buy from you than other markets. This is a much more affordable, efficient and effective way to reach potential clients and generate business. For example, an interior desin company could choose to market homeowners between the ages of 35-65 with incomes of $150,000+ in the Perth, Western Australia market. To define the market even further, they company could choose to target only those interested in kitchen and bath remodeling and traditional styles. This market could be broken down into two niches – parents on the go and retiring baby boomers.
With a clearly defined target audience, it is much easier to determine where and how to market your company. Below are some steps you should look at when defining your target market.
- Look at your current customer base – who are your current customers, and why do they buy from you? Look for common characteristics and interests. Which ones bring in the most business? It is very likely that other people like them could also benefit from your product/service.
- Check out your competition – who are your competitors? who are their current custoemrs? Don’t go after the same market. You may find a niche market that they are overlooking.
- Analyze your product/service – Write out a list of each feature of your product or service. Next to each feature, list the benefits they provide. Once you have your benefits listed, make a list of people who have a need that your benefit fulfills.
- Choose specific demographics to target – Figure out not only who has a need for your product or service, but also who is most likely to buy it. Think about the following factors; Age, Location, Gender, Income Level, Education Level, Marital or Family Status, Occupation and Ethnic Background.
- Consider the pyschographics of your target – Psycographics are more personal characteristics of a person including; Personality, Attitudes, Values, Interests/Hobbies, Lifestyles and Behaviour.
- Evaluate your decision – Once you’ve decided on a target market, be sure to consider; are there enough people that fit my criteria? will my target market benefit from my product/service? Will they see a need for it? Do I understand what drives my target to make decisions? Can they afford my product/service? Can I reach them with my message? Are they easily accessible?
Defining your target market is the hard part. Once you know who you are targeting, it is much easier to figure out which media you can use to reach them and what marketing messages will resonate with them. This will in turn give you a better return-on-investment (ROI) and ensure that your marketing money is well spent.