A target market is a group of people or companies to whom you want to sell your product or service. They are the ones who'll be interested in purchasing what you offer and most likely to buy with little salesmanship on your part.
Failure to understand your target market can cost you money, time and effort. And they're things that no business can afford to waste.
Identifying your target market is essential to any marketing strategy.
Knowing your target market allows you to focus on selling to those who want or need your product or service — not those who don't.
But how do I determine my target market?
One of the ways to start is to look at your current customers and gather all the details about them that you can:
Age
Put together an age range and work out the average age. This will determine the tone of voice you use and where you advertise your business.
Location
Are they local, national or international? Knowing this can help you plan your social media marketing strategies and the best times to post.
Spend
How much have they spent with you? When was the last time they purchased something? If it's been a while, why have they stopped? Are they going elsewhere due to price, quality or delivery? If you don’t know, ask them.
Interests
What other things are they interested in? Can you use that information to better your product or expand your services?
Stage of life
Are they new parents or newly single? Have they recently retired? Have they just finished university and started a new job?
The more data you have on them, the better you'll understand them, their needs and wants.
But don't stop there. Find out what they like most about your product or service. Ask them how it benefits them and ways you can improve.
Start out with questions like:
- How do you feel about using my product/service?
- Does it make your life easier?
- Does it save you time or money?
- Have you told anyone about it? Why? Why not?
- Are there any ways I could improve it to benefit your business/life?
Dig deeper and you may find that you can tailor your product to fit a niche that your competitors aren't filling.
Additionally, their answers can help you determine what your target market needs to hear about your product. You can use them to develop email or ad campaigns to gain an edge over your competition.
I can use social media to connect with customers can't I?
Sure, but it can be a wasted effort if you post on a lot of different platforms without knowing who you're targeting.
Aim where your target customers are likely to be.
For instance, if your business sells primarily to businesses (B2B), then LinkedIn may be a better place for you than Facebook. If you sell primarily to individual consumers (B2C), then Facebook, Instagram and Twitter are probably better choices to connect with consumers. Don't be afraid to get it wrong sometimes.
How can I stay up-to-date with my target market?
Once you know your target market, start looking for them on social media. Find out where they gather and listen to them. Not every business does it and this is a missed opportunity.
For example, Kmart Australia sells its own in-house air fryer and devotees have set up a Facebook group called "Share Kmart Air Fryer Recipes Australia." With more than 56,000 members who share recipes and recommend accessories, it would be a perfect place for Kmart to learn more about their market.
And going by what's been posted, Kmart could release:
- Air fryer recipe books
- Cake tins
- Wire racks etc.
All of these items would fly off Kmart’s shelves. Instead, members are buying them from eBay and other stores.
OK, but can't I just offer the same product year on year?
Simply put, no. People change. Markets change. Technologies change. Economies change. Nothing stays the same.
Smart businesses adapt and make the most of their customers' insight.
Take a look at the Coca-Cola company. Coke has been one of the world's best-selling drinks worldwide for decades. But when consumer attitudes changed toward healthier options, Coca-Cola rose to the challenge.
They looked at ways they could make their main product healthier by using alternatives to sugar. Not only that, they started buying companies that made healthy drinks, such as:
- Smartwater
- Fuze Tea
- Vitaminwater
And the investment has been worth it. In fact it's paid off handsomely.
Another thing to be mindful of is that buyers are increasingly holding businesses accountable to impacts on climate change, working conditions and other social problems. Knowing how your target market feels can help you address such issues before they arise .. or share the work you’re already doing to make the world a better place.
Why go to the trouble of knowing my target market?
Here are a few benefits you can print out and stick to your computer screen:
- You don't have to do the hard sell because the market already wants/needs your product.
- You can offer specialised products and services that make additional money.
- Instead of advertising everywhere, you can save money by advertising in the media that's popular with your target market.
- Your customers will appreciate the time you spend on getting to know their needs.
- You’ll become known as an industry expert, attracting more customers because of your market knowledge.
- You'll anticipate change. This will enable you to adapt your offering to suit those changes — and increase customer loyalty.
- You'll learn to adopt the tone of voice of your target market, making every communication more effective.
So get started, because if you sell a product or service, the advantages are huge. And while it looks time-consuming, it's not difficult to maintain once you've settled on who your target market is.
Most importantly, it will enable you to read a shifting market, fill gaps, find niches and potentially put your business ahead of your competition.
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