PDA

View Full Version : How do you identify your Target Market



silas
09-27-2012, 04:45 PM
Anyone who has researched marketing has heard of defining your target market.
I am a little confused to what it means exactly. In my business, I aim to provide service for businesses (shops, services, products, restaurants, coffee shops, malls, etc).
How do I define my target market in greater detail?

Harold Mansfield
09-27-2012, 06:11 PM
Anyone who has researched marketing has heard of defining your target market.
I am a little confused to what it means exactly. In my business, I aim to provide service for businesses (shops, services, products, restaurants, coffee shops, malls, etc).
How do I define my target market in greater detail?

You just did. Now you just need to get a little more detailed...obviously you are looking for decision makers, so you probably want owners and managers. If you are doing business locally, you may want to add your geographic location to the mix. Sounds like you are looking at Small Businesses, and not large corporations, so that also narrows things down.

And then find out where they are hanging out where you may be able to get access to them. By hanging out, I mean where they frequent online, what media they read, and how you think they would go about looking for your particular services.

For instance, if you are some kind of contractor you may want to list yourself in that kind of directory...sort of like how Angie's List is for home owners.
It's going to be slightly different depending on your marketing strategy. What you do in the Yellow Pages for instance, is not the same way you'd do it on Facebook...for instance. Each method has it's own strategy.

That's the best I can offer without knowing the product or service.

silas
09-27-2012, 11:05 PM
Thanks for the input - and yes mostly small to meduim businesses and also start up companies. The service I provide is videography - videos about or for helping to sell a service or product (web infomercials, tv commercials, corporate event training sessions, etc). I'll try to find some more info about where decision makers hang out, what they read, etc. I was even thinking that Time magazine might be a good place to put an ad (to get larger companies possibly as well). Thanks for any other input!

Freelancier
09-28-2012, 07:51 AM
What I tell people is to envision their best potential client. Not just any potential client, but the best ones. You want the ones who are going to fall in love with your product/service, use it all the time, recommend it to their friends. Who are they? How old are they? What does their family look like or what does their business look like (depending on whether you're B2C or B2B)? Is their business wildly successful, just starting out, starting to fail? What magazines do they read? How would they look for someone/something like what you want to sell them? When they look, what messages are the most powerful to them (low cost, low risk, high return, prettier, better, faster, higher, whatever)? Basically, learn everything you can about them and what turns them on when it comes to what you want to sell them.

Once you have all that, marketing and selling to them is just a matter of getting out there and using that knowledge.

TimPiazza
09-28-2012, 10:38 AM
Freelancier, how do you figure out that level of detail, such as which messages are the most powerful?

Freelancier
09-28-2012, 11:42 AM
It's certainly not something you figure out all at once. It takes time and talking to your clients to figure things out.

Initially, with most businesses, your "target market" is anyone who will pay you to do/deliver what you have. That's just the reality of getting started.

Then when you talk to clients and potential clients enough, you start to figure out which clients are the easiest to sell to, which ones value your product/service the most, which ones are willing to pay what, and then you can meet with them and learn a whole lot about them just by asking questions and being observant. And you don't only have to talk to clients to figure out the clients, you can also talk to people who offer products/services that are complementary to what you offer. For example, authors who write about the markets you're looking to enter are usually a talky bunch when you get them on the phone, just because writing is so solitary that talking to anyone is a bonus part of your day.

Once you really understand your clients, you can figure out the messages that will resonate. For example, for my consulting business, the size projects I'm looking to land are higher than the average one-person shop would be comfortable with, but that also means the client is assuming a larger amount of risk by contracting with my business, so the most powerful messages I convey are "reliability" and "money-back guarantee". And those messages came out of talking with enough potential clients to know that they were afraid of the added risk, but intrigued by my much lower price, so I already won the price competition, I just needed to lower their potential risk.

silas
09-28-2012, 12:42 PM
This is making more sense, thank you!

So maybe part of my target market is managers, supervisors, and other decision makers....so looking into those types of people and how to reach them would be benificial! :)

Freelancier
09-28-2012, 02:11 PM
You're still too vague. All companies have "managers, supervisors, and decision makers", so you didn't narrow down the field at all.

Let me help you get started here. My consulting company would not be your best customer. I'm a one-person programming consultancy and a video of my company wouldn't help land business, so I'm not looking to pay for that. If I want a demo for a client, I might use one of the screen capture packages that are out there, but I don't need a videographer.

However, I have a piece of rental property. I want people to be able to see the rental home in its best possible light. So video might be a good solution for that. Which means one of your potential clients might be realtors or rental agencies or apartment complexes, like that. Or it might not, but at least this is narrowing down which industries you should target.

Does that help clarify?

silas
09-28-2012, 02:17 PM
Oh I see... so like narrowing it down to realtors, resturants, coffee shops, or whatever?

The only thing is that all of those would be in my market.....but maybe its better to just forcus on restaurants or technology companies....etc.....??

Freelancier
09-28-2012, 04:25 PM
The only thing is that all of those would be in my market..

Sure everyone in the world could be in your target market... but that means you have to waste a lot of money and time marketing to everyone. So you focus on those customers who will "get it" faster and who readily accept your value proposition.

Your target market are your best potential clients. You might get other clients along the way, but which ones are going to be the best?

For example, my best consulting clients have businesses making between $500,000 and $5 million per year, don't have their own programming department, are located within 100 miles of Atlanta, who are run by people who are technically savvy enough to get that programming can help drive their top or bottom lines. The people running these companies are busy, so the don't have time for networking meetings like Chamber of Commerce, so they -- or their infrastructure person -- will do a Google search to find someone like me. Now all those criteria doesn't mean I don't have clients as far away as Phoenix or as large as a multi-billion company... it's just that I don't bother looking for those clients, because it's too expensive to find them and compete for them. I'd rather get those outside my criteria by having them find me, not by actively working to find them, just because it lowers my cost of sales.

So back to you: are a couple of guys who own a coffee shop your best potential customer... or is it the coffee shop company with 20 stores... 100 stores... 1000 stores?

silas
09-28-2012, 05:02 PM
Ohhhh...got it...so basically targeting is narrowing the potential clients down and then trying to work that angle. Makes sense. And that's why its so important to figure out which would be best to work for. Thanks for clarifing all this! It makes much more sense now.

huggytree
09-28-2012, 05:09 PM
i define my market mainly by income level of the customer.......YOU set your market by your prices....if your the cheapest and you name yourself like Budget blahblah llc then your going to attract low end/price shopper customers.....if you set your prices high and name yourself something like Quality blahblah llc your going to attract higher end customers and turn off the low end guys...i turn them off by adding the phrase 'we do it right the first time'....believe it or not it has eliminated almost 100% of price shoppers....they know that doing it right costs money.

it took a few years in business before i could exactly define my customer base....i could give you a detailed definition and 90%+ of all my customers would fit into that small definition.

you cant target your customer w/o knowing your customer.....and you choose your customer base by how you run your business.

billbenson
09-28-2012, 11:41 PM
What kind of price range are your products. If your product is complex or expensive you need to sell to all of the following: "managers, supervisors, and decision makers". The engineer will spec out the product, marketing may take a look at it, project management will also be involved and give it to purchasing who will look for the best price. This is in a corporate environment which you are kind of describing.

Lower priced products may just be placed on a corporate credit card by some manager. Depends...

We need to know more about what you are doing!

silas
09-28-2012, 11:53 PM
Absolutely...Here are examples of what I have done and would like to keep doing:

- A technology company may has new software, technique or product. A video would be used to show and communicate within and outside the company about the software or product.
- An Inventor created a product that he would like to market to a manufacturing company. A Video was used to show the strengths of the product and its functions, the inventor got a large deal from the manufacturer.
- A local restaurant was trying to get more business to its little known area. A tv commercial I made helped it get the business, move to a better a location, and continue running.
- A start up company supports a cause and needed to get its products into a large national chain. A video Presentation was created to show the benefits and increased sales that would be made by its product. It got a the multi million dollar contract.

These are a few good examples of what I do (video production) and the cost is usually several thousand. Actually in thinking things over, I would like to market my services to larger companies as well as start up businesses who have the money needed to create a successful video.

Wozcreative
09-29-2012, 02:08 PM
Like Huggy said, it can take a few years to get it right, to figure out who the best candidates are for your business/service/products.

When I started a few years ago, one of the main things I knew was that bottom feeders were not who I was trying to go after. Theres already enough designers willing to do free work to "prove" themselves. My strategy was to be able to show the quality I produce with every piece of marketing, website, print etc. I do as proof. I wanted clients that respected me, and those that pay a little more are showing they trust you and leave everything up to your expertise.

Another aspect that I use to determine if the client is the right fit: Size of project. If the size is something that requires me to have to use more than one outside resource, it is not something that I'll enjoy, as these types of projects then turn into me being a Project Manager full-time and not being able to do the things I love.. design.

Sometimes I can tell by the way a client speaks, if they are the right fit as well. Sometimes I will get a potential calling me to get some quotes done, explaining their whole business, but they keep shooting down my past work, or telling me "we aren't like your other clients", your work is good, but I don't want to see this that that that or that.. so why even consider me?!

One last thing.. if the client seems to be a time waster! Too many questions, too many phone calls emails etc, even before the job has started is a warning sign that A) They are not organized B) They are a bottom feeder and trying to get as much out of you as possible C) Price shopping
Because of this last part, I've ruled out the Real Estate Industry. Cheap, Time wasters, Micromanage and mostly production work. They want you to use templates all the time, keep you on the phone and request endless quotes to try to get something cheaper. Of course, these are just the regular home sales guys, I do have a few clients in the Architecture and Business Real Estate industries—because these people know how to get it done.

So I'm learning everyday who the right client is and how I can target them.. but when you start a business it is a good idea to get a solid understanding because you can be throwing yourself under the bus if you aren't making some kind of profit.

silas
09-29-2012, 02:13 PM
This all makes sense! And I know what you mean about bottom feeders. I can usually tell too if its a waste of time or not. lol thanks for all the great advice!

simplybusiness
10-08-2012, 10:17 AM
Some great responses in this thread... I think it comes down to the "value/benefit" of your product. WHO would benefit most from your product or service? If you cannot answer that question than you have not figured out who your target market is or you do not have a solid enough product.

VALUE is what you need to offer and those who see this value in your product/service will be your most loyal customers.

JacobPhillips
02-19-2013, 12:59 PM
All great post guys, I thought I'd throw my two cents in here because it's a topic I feel strongly is one of the most important factors for efficiency in marketing at the small business level. The technical way to look at this is to define your most common customer under the following parameters:

Geographic
This, maybe obviously has to do with their location. Are they:
- Urban or Rural?
- Local or International?

Demographic
This is the most common type of classification for a target market and has to do identifying customers based on demographic information such as:
- Age
- Sex
- Income
- Martial Status
- Family Makeup

Psychographic
Finall we get to Psychographic classification which is always the trickiest. It is mostly "lifestyle" related and has to do with things like are they:
- Environmentally conscious?
- Health Conscious?
- Spend a lot of time online?
- Lead an active social life?
- Where do they hang out?
- What do they do in their spare time?
- What makes them happy or sad?

Why does this matter?
After defining your customer in these ways the next logical question might be why is this important? The reason is that you want to make sure you are implementing marketing strategies that will reach those most interested in your product or service. If your target market was a 60+ year old male, who reads the newspaper everyday and rarely goes online it wouldn't make much sense to spend a lot of your time and resources on a social media campaign. Likewise if your business largely comes from people around the world it would be a waste of money taking out an ad in the local newspaper.

Hope that helps to get you thinking about your target market and how big of an impact it can have your marketing strategy :)

dianecoleen
02-19-2013, 05:53 PM
Makes sense to me @Jacob. I have done this demographic research, and it seriously takes a lot of time to me. As a novice, this requires me much consideration in dealing with information. IMHO, market research is a critical phase on marketing challenges. 'Coz a further test should be proven in order to obtain who really your market is.

mark2media
02-20-2013, 09:19 PM
Defining your target market is only the first step. Once you've defined your target market, make sure you define the path your target customer will take once that person has given you permission to market to him or her.

If you are an existing business owner, you can define your target market by creating a spreadsheet of your customers. Then look for the most profitable customers you had over a period of time and try to determine what characteristics they share. Once you have identified some real differentiating qualities about this group, you can look for many more just like them.

smallbizjunkie
03-08-2013, 11:36 AM
I agree with Freelancier. Stop and think for a minute -- what would your ideal client look like? Would it be someone that pays in advance for your services? Someone that understands what you do and doesn't ask you a million questions (or argue with what you do), etc. Have you had clients in the past that for whatever reason just were not ones that you got excited about working with? Those are the ones that are NOT your target market. What type do you enjoy being around? With whom do they associate with? Who are all the people that could use your services? Which of these do you most understand and feel the most excitement working with? Do you know people already in any of these groups? When you look at your life experiences as relate to those people who are in your target market, you'll be able to start focusing more on that particular group.

As an example: I am a small business coach. I have been in business for over 30 years, and know from the ground up, what it's like to start, and grow, a company. That's why that's the group I work with. I work with homebased, and 1-5 people companies. I work with the owner(s) and I work with people both in person and online. I do not work with large organizations, and I only work with people who already have businesses. See how I've narrowed down my market? Does this help? :)

semaphore.v
04-06-2013, 05:04 AM
Paid survey or ready market research will help, some content sharing site share free report.
You can find case study from your Competitors’ site, how they deal with client and which type of client they have so you might have an idea.

michaelknulst
04-08-2013, 03:48 AM
Hi Silas, the number one mistake entrepreneurs make is that they first create a product or solution and then try to find a market in order to try selling their product or solution to. This is working backwards! Don’t forget: You cannot create demand!

The first thing you’ll have to do is to find a need or a problem that many people are having. How can you find this out? Ask them!
When you know what your target market wants you start creating or finding a product to solve it. Be aware of the fact that people don’t buy what they need.
They only buy what they want.

So let’s be clear on that: Your market or niche already exists. It is not something you just pick from among a selection. The only task you have to do is to discover the market or niche that fits your experience and/or solutions you already have.
So find out what people want, that they are not getting.
Then find or create products and services to fill or solve what they want.
The next step is to narrow down your niche!, based on the part of the niche that has the most frustration, pain or desire.

Harold Mansfield
04-08-2013, 10:07 AM
Hi Silas, the number one mistake entrepreneurs make is that they first create a product or solution and then try to find a market in order to try selling their product or solution to. This is working backwards! Don’t forget: You cannot create demand!

The first thing you’ll have to do is to find a need or a problem that many people are having. How can you find this out? Ask them!
When you know what your target market wants you start creating or finding a product to solve it. Be aware of the fact that people don’t buy what they need.
They only buy what they want.

So let’s be clear on that: Your market or niche already exists. It is not something you just pick from among a selection. The only task you have to do is to discover the market or niche that fits your experience and/or solutions you already have.
So find out what people want, that they are not getting.
Then find or create products and services to fill or solve what they want.
The next step is to narrow down your niche!, based on the part of the niche that has the most frustration, pain or desire.

I'm going to have to disagree here. There are plenty of examples of products and services created that didn't have an existing market, and plenty of examples of businesses that defined those new markets. We are using one example right to communicate on this post.


You can absolutely create demand.

billbenson
04-08-2013, 05:32 PM
I'm going to have to disagree here. There are plenty of examples of products and services created that didn't have an existing market, and plenty of examples of businesses that defined those new markets. We are using one example right to communicate on this post.


You can absolutely create demand.

If you couldn't create demand for a product that doesn't exist, there wouldn't be inventors. Ron "Ronco" Popeil made a career out of inventions - although his inventions usually were cheap versions of commercial product that already existed. Smart business model!

Making a product that doesn't exist is a tough way to go, but it certainly can be done.

Harold Mansfield
04-08-2013, 06:08 PM
If you couldn't create demand for a product that doesn't exist, there wouldn't be inventors. Ron "Ronco" Popeil made a career out of inventions - although his inventions usually were cheap versions of commercial product that already existed. Smart business model!

Making a product that doesn't exist is a tough way to go, but it certainly can be done.
Great example of someone who created a market for every product, where before none existed! He perfected the art of making you believe you needed something. Made you wonder how you got along all this time without it. Ron Popeil was a GREAT marketer. The marketer of all marketers. He changed the game.

billbenson
04-08-2013, 06:41 PM
And his products at a consumer level were good. I've had pasta machines and a lot of his other products and they worked well and lasted for years. They wouldn't last in a commercial kitchen though.

Consumer reports (or someone else, don't recall) did a review of products sold on infomercials. They found that most lived up to their claims. Particularly Ronco products.

jacksarlo
04-12-2013, 02:51 PM
Your target market are those prospects who WANT what you sell, who have MONEY to buy it, and who you can REACH in some way or another... in other words your best prospects, the ones you can actually "make money with"! That's how I define it.

Lee Simon
04-13-2013, 09:56 AM
Hi,
This is Lee Simon advising you that the best way to identify your target market is to do some market research into the demographics of your prospective targets to make sure you have the right demographic profile, like age income level, ethnicity, education, etc. Also, figure out what geographical area you wish to market to; local, statewide,k national, worldwide. If you have different products or services to sell, you can have more than one target. “Who you gonna sell it to?” “To whom do you wish to sell it?” “Where will ya peddle it?”

A market target is not the same as a market niche. They are related, but have slightly different functions.
A target is a selection of a specific group of prospects:
1 All those who have not purchased in the past year
2 All those who purchased under a certain amount
3 All those who purchased over a certain amount
4 All those who did not purchase at all
5 All those who called, rather than came in to the office/store
6 All those who purchased only once before
7 etc.

Here are the steps:
1. Pick your target
2. Decide how you will reach them
3. Decide why you will reach them
4. Decide when you will reach them
5. Decide what you will tell them

It must be the following:
1. Well defined Vague=no results.
2. Large enough If it’s too small it’s not worth targeting it
3. Reachable If you can’t get your message to it for a reasonable cost, forget it

iggypop
05-16-2013, 05:45 PM
Well essentially you look at the services you provide then you think about the type of people/places who would need those services and you look at the whole by doing that you will see some common denominators/traits that better illustrates your target market.

markhendricks
07-26-2013, 10:36 AM
Your best target market is:

- someone who already knows they want what you have
- someone who wants it now
- someone who can afford it
- someone who can make the buying decision
- someone who is appreciative of the product or service you provide (assuming it is high quality)

So sit down and think.

Who is that person?

Are there more than one person like that? (most likely a lot)

Where can I find them?

How can I get my offers in front of them?

What will they respond to?

And on and on...

As always, my best to you --

Mark Hendricks

farrey
08-01-2013, 06:33 AM
First analysis your customer age,gender,classification and also their incomes.Then you can identify your target easily.
Segmentation must be necessary to run your identify business successfully,

Colorful Promo
10-04-2013, 09:19 AM
Have you done Facebook searches for marketing. For instance, I do Business to Business, and search Facebook for similar pages. There I can Like those pages, study some marketing ideas in that particular niche and get ideas from others pages. The other day, someone from Southern Fried Chics Facebook page liked my page. They have 282k Likes and also do Promotional Products. Search Videography and see how many similar pages you can find.

growyourbusinessmore
10-10-2013, 04:36 AM
Gettting your target market is key to success!

Ask yourself important questions like Where does my TA live? What do they like? And dislike? Who can I help more with my service or product? And so much more :) Good luck.