Thursday, December 10, 2015

4 Steps to Identify Your Target Market

market

 If you are getting ready to launch a startup, or you are preparing to add a new product or service to your list of offerings, you must have a target customer profile mapped out and clearly defined. Unless you prefer sending your marketing dollars straight to the trashcan, of course.
A lot of startups fail – that’s not news. But, a lot of them fail because they did not define their target market and failed to learn the in and outs of it.
So if you don’t want to end up in the same boat, try applying these 4 steps.

Develop a Profile of People Who Will Purchase Your Product or Service

Begin with creating a simple list of the people who would want or need what you wish to sell the most. Once you have your list, you can begin dividing the people into categories. The categories you use will depend on a number of factors. For example:
  • Are you B2B or B2C?
  • Do you sell a luxury service, or something that is a necessity?
  • You could divide by gender, geographic location, market (retailers, distributors, consumers, wholesalers), income, or any number of categories.
Once you have your categories, you can begin collecting data for each one. Are the people in a particular category married or unmarried? Do they have disposable income? What are their politics? Do they travel? If you don’t feel comfortable making these assumptions yourself, you could do a little market research by using surveys and polls to collect data. Ultimately, you should have a few different customer profiles.

Identify the Customer Profile Who Wants or Needs What You Sell The Most

Once you have your list of profiles you can sort them in priority order. Essentially, you want to identify the profile that is most likely to have the problem that your product or service solves, and is most likely to have the ability to purchase your product or service. Then categorize your other profiles in order after that.
“When considering who is most likely to have the problem your products or services can solve, don’t just think in terms of physical need. Stress, comfort, reputation, and vanity are also things you should consider as needs when identifying your target customer. Remember that luxury and entertainment products solve problems as well” – says Harsha Kiran, CEO of BargainFox.
Another thing to take into consideration is which customer profile has the most to lose if they do not find a solution to their problem. This is very important, because it can be used as a sales and marketing angle when you target that particular group.

Look at Your Customer Profiles and Determine Which Ones Aren’t Having Their Needs Met

Here is what you have identified so far. You know which customer profiles have the most to lose if they do not find a solution to their problem. You know which customer profiles are most likely to have the problem that you solve and also have the ability to buy your product. You also know their interests, values, hobbies, etc.. The next thing to determine is which customers aren’t being reached by your competition.
The best way to deal with competition is to avoid it altogether. This means identifying untapped markets, so you don’t have to fight for your space. Take a look at your competitors marketing efforts. Who are they going after in their ads? If they blog or are active on social media, who are their posts trying to connect with? What about their branding? Who is it designed to impress? If you see a customer profile on your list that is being largely ignored by your competition that could be your sweet spot.

Pick Your Primary Target Customer Profile

Ultimately, the group that you target with your marketing efforts should fall into as many of the following categories as possible:
  • Most likely to have the problem that you solve;
  • Able to afford your solution;
  • Has the most to lose if they do not find a solution to their problem; and
  • Not being targeted by your competition.
Once you’ve made this identification, you can use the information you have gathered to tailor your marketing to reach that audience.
target

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