Over half of UK start-ups fail within five years.
Various factors cause small businesses to fail. However, at the root of it all, is the lack of a proper strategy. This includes failure to identify a target market.
Many startups usually look to sell their products to the general populace. Unfortunately, this is like shooting without aiming.
It is imperative to find out who really values your products. This will allow you to tailor your strategies for that audience so that you can achieve higher ROI. That is what target marketing is all about.
This article will discuss how to determine your target market.
What Is a Target Audience?
This refers to the specific group of individuals that you desire to reach with your marketing message.
These are people who are the most likely to purchase your products. Members of your target audience tend to have something in common, such as behaviours or demographics.
In a nutshell, your target audience consists of people who possess the same needs and desires that your business is looking to serve.
As such, pinpointing your target market needs to be the first item on your business plan as well as being a critical component of your marketing strategy. A company that does not accurately define its target audience is looking to fail.
The most common parameters used when defining the target market include demographic, behavioural, geographic, and psychographic factors.
Why Must You Identify Your Target Market
Simply put, without a clearly defined niche, you will not meet the goals you are looking to achieve with the business. Here are some of the ways in which a defined target market helps you in business:
• It allows you to tailor your goods for a specific audience making them more likely to buy
• It allows you to only focus on the essential aspects of your business
• It allows you to tailor your marketing to those individuals
• You are able to save on costs since you do not have to advertise to the general population.
As such, identifying a niche market is not something to think about, it is something you should do even before you begin operations.
Tips for Identifying Your Target Market
Pinpointing your ideal customers will take a bit of work. Consider utilising the following strategies to help you with those efforts.
1. Identify the Problems You Solve
Understanding the problems your products solve allows you to identify the people who suffer from these problems.
Thus, you need to do product analysis to determine the benefits of your offerings. The analysis will allow you to pinpoint areas you can adjust to accommodate your desired audience.
2. Study Your Current Customers
Studying your existing customers gives you valuable insight into the characteristics of the people who are interested in your products.
This allows you to go after individuals who have the same characteristics but are not buying from you.
As such, you will need to approach your customers to gather this data. Consider having the following data points in your questionnaire:
Some people are not comfortable revealing their age. So, instead of asking specifics, just ask the decade they were born in.
Where do your customers come from? Knowing this information allows for geographical targeting especially when advertising.
What are your customers’ hobbies? What other products do they use apart from yours?
Collecting this data allows you to create a solid persona about your buyer. As such, you will be able to customise your products so that they become more appealing to your clients.
3. Analyse Your Competition
What is it about your competitor and their products that make some people opt to go to them and not to you? Figuring this out can give you a lot of insight.
Also, look into who your competition is targeting. What are their current clients like? If you figure these things out, you to make adjustments in your strategy.
4. Do Some Fieldwork
Sometimes, the best way to understand a customer is to put yourself in their shoes. Therefore, perform experiments by acting as a customer to the people who deal with your kind of products.
For example, if you are in the food industry and are looking to open a café, analyse your potential market by going to a café. Sit there and observe how customers and staff are going about their day.
For this example, attempt to answer questions such as:
• What are they ordering?
• What is the age range of the customers?
• How much are they spending on average?
• Are they dining or ordering take outs?
• What times are the busiest?
• Are customers coming in groups or individually?
This can put you more in touch with your customers and will help you to understand them in a much better way.
5. Identify Potential Opportunities
After doing research, you will have a good idea about what motivates the people who choose to use your products. You might also have noticed some gaps in your competition’s strategies.
All of these are potential opportunities that you should exploit when crafting your target audience.
6. Take Advantage of Analytics
Of course, your business must have a website. If it doesn’t, ensure that you build one as soon as possible.
Website analytics tools such as Google Analytics allow you to see the following:
• Who is visiting your website
• Where they are from
• How they are interacting with it
Consider doing the same for your social media pages. People visiting your sites are obviously interested in your products and thus, they give you a clearer image on who your target customer is.
7. Putting It All Together
If you have identified the potential niches in your market that could serve as your ideal target audience. The next step is to come up with a product, marketing, and an online brand development strategy.
These strategies will allow you to create the ideal product for that target audience as well as an advertising strategy.
Increasing Your Efficiency Through Target Marketing
The most successful companies are ones that know what makes their customers tick. Thus, instead of targeting the general population, identify the specific people that are more than likely to be repeat customers.
That is your target market. Study them so you can understand them. This will allow you to create better products for them.
Climb Online is a digital consulting company that helps businesses by studying their processes, competition, and target audience to help them devise ways to increase their revenue.
Contact us today for more information about how we can assist you.