Whether you’re just starting out as an entrepreneur or have been in the business game for years, there are two questions that you need to know the answers to:
Who is your target market? And why?
While it might sound like a relatively easy question to answer, if you’re not specific with your answers, you risk having less effective marketing and losing potential customers.
Now I know what some of you may be thinking – ‘well my target market is everybody’, and that sounds great in theory, but it's simply not possible and having this mindset could cause a disaster.
Even if your product or service is something that can be used by anybody, the reality is, it won’t be.
Some people won’t connect with your brand, some may choose another brand (due to many different reasons), and others simply won’t be convinced that they need what you are offering.
And that is okay. You don’t want to be offering a product or a service to everyone. You want to find your audience.
The whole point of figuring out your target market is that you can spend your time, energy and money marketing to the people who are actually going to buy your product/service.
If you’re not sure where to begin, we’ve covered the steps below to help you identify your target market and start maximising your marketing ROI (return on investment - we will cover this next week in detail).
1. IDENTIFY WHAT NEEDS YOUR BUSINESS FULFILS
Before you launch headfirst into starting a business, you need to identify what consumer needs your business will fulfil. While this won’t ensure success, it will help you assess the potential demand for your product/service.
Start with answering questions the following questions very clearly:
What problem does this business solve?
What consumer needs does this business meet?
Use the benefits of your product or service to really figure out the answers to these questions. Instead of simply just explaining what you do, define the outcomes you provide for your customers.
For example, rather than saying “we offer pre-made meals” you could say, “We offer healthy and delicious ready-made meals that use locally sourced ingredients to help save people the hassle of grocery shopping, cooking and thinking of nutritious meals each day. Plus, we deliver straight to peoples doorsteps so they can conveniently buy online.”
See how the second option already explains some of the target markets problems? #winnerwinner
Another way to help you figure out your customer's needs and desires is to create buyer personas. A buyer persona is an extremely detailed description of the consumer you wish to be buying your product – everything from spending habits, family status, income and motivations should be included.
Creating a buyer persona will provide you with clarity around what your customers’ needs will be and how exactly your product or service will fulfil them.
2. USE A FUNNEL APPROACH
Think of the funnel approach as a multiple staged process that includes both psychographics and demographics to help you further filter down your target market. Your first step may be gender, and if your product or service is gender-specific this will automatically narrow down your target market. Your second step may be location, if your business is only going to serve the needs and wants of customers within a specific region (ie., you are a brick and mortar store that does not deliver), you can narrow down your market once again. The third stage may be income – a university student working a part-time job is probably going to be ‘grouped’ within a completely different income bracket than a young professional working that is working full-time.
When using this funnel approach, you can include as many steps as you like, with topics such as these listed below:
Now remember, the more steps you include, the more detailed your target market will be, and the easier you will be able to find the intersection of “highly interested” and “able to buy”. This last group of people are EXACTLY who you are wanting to speak to and with and ultimately who will be spending money with you and your business.
3. GATHER DATA
Figuring out your target market means combining your conclusions found about with actual data. This data can come from a variety of places, including survey data, existing data or your own network. This may mean conducting surveys via email or social media, or even finding a marketing firm (ahem, subtle plug) to help you gather data.
If there is a similar product or service already on the market, look into the demographics of their customers – Who is buying their product? When do they buy it? Existing data is already out there, use it to your advantage!
Lastly, turn to your friends and family to see products that they are using, what they are spending their money on and what their purchasing habits are like, and don’t be afraid to straight up ask them for their opinion. When gathering data, make sure you’re collecting as many diverse perspectives as possible.
A clearly defined target market is crucial for the long term success of a business and understanding what differentiates your product or service from others on the market will allow you to better focus your marketing efforts.
PSST - if you want to know more about discovering your target market, please reach out and book in here for a discovery call. During this 15-minute free chat, we will discuss what is necessary to get you from Zero to Hero.
See you next time,
Zoe, Team Greenery & Co.