Everything your firm does, from the products you develop to the marketing strategies you develop, is driven by your target market. Selling to everyone and anyone is impossible. Because your marketing messages are so highly tailored, placing limits on who you target increases the overall number of purchases.
It could appear as though identifying your target market is just another item to cross off your “starting a business” to-do list; once your product is out there, you stop looking at it. However, it’s debatably the key step in the procedure.
What then is your target market definition? Furthermore, how do you make money for your e-commerce firm from a gorgeous PDF or slide deck?
This guide offers the solutions and gives answers to everything you need to know about your target market.
Key Takeaways
- A target market is a collection of clients with similar demographics who have been chosen as the company’s most likely purchasers for its goods or services.
- Any business that wants to create and carry out an effective marketing strategy must first determine its target market.
- The characteristics, packaging, and distribution of a product can all be influenced by the target market.
What is a Target Market
A target market is the particular demographic that is most likely to purchase your goods or services. The kind of customers that come back frequently, tell their friends about you, and gush about you on social media are the ones you should be concentrating all of your efforts on attracting.
How To Identify The Target Market of Your Startup and Reach them
To reach your target market, you don’t execute marketing campaigns. That would be too general; what helps you act on your information is segmenting your market to find target consumers for different ads.
To develop target audiences, or a more focused portion of your target market for whom your marketing efforts are intended, divide your target market into smaller categories according to these characteristics. These include buyer personas: pretending to be one of your target market’s target audiences
Consider them to be fractions of your target market if some traits are common to some potential clients but not to others. Here are three prominent marketing strategies that make use of this data:
- Demographic division
- Localization
- Psychographic/Mental health segmentation.
1. Demographic division
By using demographic segmentation, personas of people with similar traits can be created, including:
- Religion,
- Ethnicity,
- Age,
- Generations (e.g. Gen X, Gen Z, Millennials, etc.)
- Income,
- Marital status
- Educational attainment
Plan your marketing budget based on the percentage split between each popular demographic group. Assign half of your marketing budget, for instance, to efforts aimed at persons in your target demographic who are between the ages of 40 and 65.
Similarly, tailor your marketing messaging and the products you’re pushing by using the demographic data for each segment. You might make the following product recommendations for a Christmas gift guide:
- Income range. Make a list of presents for those with modest incomes that are #20,000 or less.
- Kinship status. For married parents, suggest “World’s Best Dad” personalized goods.
- Generation. Launch an Instagram marketing campaign targeting Gen Z viewers with product recommendations from influencers.
2. Localization
Geographic segmentation describes variations in the areas where your target market is dispersed, such as:
- Climate
- Currency
- spoken language
- City, region, or country
You can customize the purchasing experience by dividing your target market into geographic segments. According to research, 66 percent of customers want the businesses they buy from to know what they need.
Because of this, the revenue of marketers who segment their consumer base and tailor their communications rises by 760 per cent.
Applying that, let’s go over some different applications of localization:
- If a significant portion of your target market is conversant in Spanish, set up translations for it on your online store.
- Run Facebook advertising to a popular city’s neighbourhood and mention nearby landmarks.
3. Psychographic / Mental health segmentation
By separating your target market into smaller groups based on shared psychological characteristics, such as
- Values
- Interest
- Opinions
- Shopping patterns
Adjust the messaging you’re sending to each group based on their psychographic characteristics. Strong copywriting is fundamentally geared toward its intended audience. The copy you present to each segment should take into account their beliefs, principles, and areas of interest.
Ways Other Startups Identified Their Target Market
Many small business entrepreneurs produce goods they wish they could use themselves. For example:
- Consider the footwear company Allbirds. Tim Brown founded the company after having trouble locating merino wool-based shoes. To fill the void, Allbirds was founded, with Tim serving as both its first client and target market.
- However, keeping with the “I am my own customer!” for too long is hazardous. The entire target market research process is destroyed by making assumptions about your target audience and basing your facts on your personal opinions, feelings, and habits. The product you wish to make may be very different from what your paying clients want.
- Let’s say you don’t like Facebook and deactivated your account in opposition to the company’s privacy policies. If we assume that your target audience is similarly inclined to you, you would cross Facebook advertising off your list of potential marketing strategies. In actuality, you’re eradicating the chance to connect with a portion of your possible clients who share the majority of their characteristics with you and have a Facebook account.
If you’re just getting started, target market research doesn’t have to be difficult, but it helps to establish a minimum viable target market—the absolute minimum you need to know about your ideal client—before getting started.
6 Categories for Grouping Target Market
- Age range
- Geography
- Income
- Interest
- Job, and
- Lifestyle or Life stage are some basic categories that can be used to group a target market. Various other demographics might be taken into account.
4 Inquiries/Challenges that Define Your Target Market as a Startup
A recommended advice to know your target market involves seeking responses to the following inquiries:
- Who stands to gain the most?
- Who is going to handle this item?
- Why do they require it?
- What distinguishes this product from its rivals in their eyes?
Solutions to Identifying your Target Market
Here is how to locate the solutions:
- Organize focus groups
- Survey current client
- Keep track of competitors
- Delve into recent studies
- Using a platform or sales channel
1. Organize focus groups
Creating new consumer data for your market research from scratch? Hosting a focus group, a group of eight to ten people who provide frank comments on your soon-to-launch product, is the easiest approach to gather immediate input.
Advertise the idea that you’re recruiting participants for a research project. Give participants a perk, like a freebie or an enjoyable experience.
Host a cheese and wine event at a nearby vineyard, for instance, if you’re investigating the target market for a new wine brand. People are more likely to respond honestly and freely when they are at ease and engaged throughout the focus group.
Alternatively, use web conferencing technologies like Zoom to host the focus group online. In this approach, you can invite participants from all over the world without having to confine your research to the perspectives of people who live in a certain region.
When choosing participants for the focus group, be open-minded, especially if this is your first foray into the world of market research. Keep in mind that making assumptions about who could purchase your product will lead you astray.
Once you’ve ruled out specific demographics that are unquestionably not your target market, you can always narrow your focus. Ask open-ended questions during the event, such as:
- What characteristics do you seek in the brands you choose to buy from?
- What would have to occur in your life for you to purchase this item?
- Who would you buy this for as a gift if you can’t see yourself purchasing it?
Dive through rabbit holes without fear. When interacting face-to-face, you can draw on the thoughts, sentiments, and stories people have to contribute as opposed to a one-way survey dialogue (or screen-to-screen). Ask open-ended inquiries and then pick out pertinent details from their response to continue the conversation.
2. Survey current clients
The CEO of Lovebox, Jean Gregoire, thinks that “your present clients are a valuable resource.” She is correct: Past clients have paid for your goods with their hard-earned money. Following the money can often lead you right to your target market.
Find out why people are buying from you, advises Jean. Do they share any hobbies in common? Next, take a close look at your offering. What attributes does it possess? What advantages do those characteristics offer? You can determine what kinds of customers would benefit from your product after you have that knowledge.
Examine the information you currently have in your ecommerce backend. Customers will provide their shipping address when placing an order. Create a spreadsheet with all of the data to determine your most popular places.
The date of the birth field might also be added to the post-purchase account creation page. As a thank you for providing age-related information for your target market research, provide customers with a free present on their birthday.
By including a customer survey in your purchase confirmation emails, you can collect extra info automatically. Concise surveys will encourage new clients to provide feedback. Ask a variety of demographic and psychological questions, such as:
- What degree of education do you have?
- What do you do in your spare time?
- Why did you decide to purchase our offering?
- At this time, what was going on in your life?
- Which media did you utilize to learn about this product?
If you’d prefer your purchase confirmation emails to be clutter-free, apps like Customer Feedback, Zigpoll, and Enquire can also achieve this for you.
In either case, search for commonalities in the responses you receive. You’ll notice that your paying customers and your target market share certain ideas, actions, and personality traits.
3. Keep track of competitors
If the products you provide are the same as those of your competitors, knowing their target market might help you focus your efforts.
Brands of toothpaste are a good example. There aren’t many differences between the formulae of popular kinds of toothpaste if you look into them. Retailers in the industry stand out because of distinctive branding that is geared to a particular target group.
List the rival businesses in your niche. Ask the following question in your customer satisfaction surveys to identify them:
- Before choosing to buy ours, did you consider any alternative products?
Even while it’s quite doubtful that any of these rivals would willingly divulge information on their audience, you can do some sleuthing:
- Look up the company name on social media.
- Examine the influencers that each brand collaborates with.
- Examine client testimonials and case studies
The objective is to differentiate yourself from them, even though competition research is a wonderful place to start for your target market research.
4. Delve into recent studies
Once you have a firm grasp on the types of people who make up your target market, you can use current industry research to delve deeper into the attitudes, sentiments, and actions they share.
The platforms listed below share customer behaviour patterns to follow:
“There are many tools to assist you to take a deep dive into your target demographic, but keyword research can uncover more intimate and private pain areas that customers or businesses may not be willing to discuss,” explains Marquis Matson, VP of Growth at Sozy. “Keyword study reveals mental health challenges, interpersonal difficulties, and body image issues,”
Use Google’s autocomplete box to see the most common relevant terms that individuals who are going through the menopause search, for example, if you know that your health supplement’s target market is women.
But keep in mind that target market research requires actual, verifiable data—not conjecture. Because of this, Marquis continues, “I speak with the customer care and social media teams to find out what real consumers are discussing to validate the subjects.
My strategy for every material that appears on the website is influenced by listening to what customers are saying and how they are expressing it.
“Once you have paying consumers, you will know who is most likely to purchase your goods. That will help you quite a bit in your target audience study,” advises Marquis.
5. Using a platform or sales channel
The platforms and sales channels that e-commerce firms use to sell to their customers all have various target audiences. For instance, a shop of handmade goods will have various target customers for its:
- Etsy profile
- Ecommerce website
- An actual physical store
Buyers from the brand’s online store will differ from those who visit its physical location.
The most obvious distinction is one of location: selling online gives you access to buyers anywhere in the world. With a real store, you can’t enjoy that pleasure (unless you’re in a popular tourist area).
The platforms you use to sell your company also have different target audiences. People who find things on Instagram probably follow one of the numerous influencers that rely on the network for a job.
However, the target market for Pinterest users might favour handcrafted items over those made in factories. Repeat the procedures we have covered to specify your target market for a certain platform or sales channel. Customers who have already made purchases from you should be surveyed.
For each referring source, create Google Analytics segments, and then use the Ecommerce Purchase report to determine the top products for visitors coming from each source:
Alternately, proceed directly to the platform. The ability to poll your audience is available on many social media sites, including Instagram Stories.
You may even hold a contest where participants can win prizes, such as free products, in exchange for information about your target audience. Simple conversation starters like “Comment below why you’d like to win” will get your fans talking.
Example of a Target Market
Are you prepared to put your research to use? Here is an example of a target market you can gain ideas from, Nike.
1. Nike
Sportswear company Nike is renowned for its market dominance. With millions of customers helping to produce $17.3 billion in revenue in the US alone, Nike items are offered in 170 other countries.
Nike has a wide target audience. The company, on the other hand, divides its target market into smaller groups and creates tailored experiences for each.
For instance, their advertising strategy uses information aimed at particular clientele groups:
- A portion of Nike’s target group that is interested in travelling is the focus of the “Guide to Summering” advertisement from Nike.
- Mothers interested in exercise are portrayed in Nike’s “Toughest Athletes” advertisement.
Customers can’t help but believe that Nike understands them, although the brand attracts the majority of individuals with a general interest in fitness. Through targeted advertising efforts, it portrays individuals who share their appearance, behaviour, and emotional state.
How to Utilize Target Market research to identify who to reach out to and how
Your target market is your company’s lifeblood. They are the kind of people who will contribute to your bank account, remain devoted clients, and recommend you to their acquaintances. But you need to know who they are to prove your existence to them and persuade them to make their first purchase.
Start your study by polling current customers, investigating your marketing statistics, watching out for rivals, or conducting focus groups. Watch for patterns that the customers who are most interested in your products tend to follow.
But keep in mind that not everyone in your target market has to share your interests. Find the factors—such as location, money, or interests and hobbies—that divide up your intended market share.
The secret to developing marketing campaigns that accomplish their job—drive new customers—is using that information for excellent positioning, message, and targeting of your target market.
What Size of Target Market should I aim for?
By conducting some desk research, determine the size of your target market. Utilize free resources, such as the one listed below, to estimate the proportion of people who share your described features.
To examine anticipated sizes based on the preferences, genders, and localities of your target market, visit Facebook’s audience builder.
Important information: Facebook’s audience builder solely uses user data. If your target market is known not to use the platform, stay away from this strategy.
However, presuming that everyone is a customer is a common error that marketers make when defining their target. Your target audience widens out too much. To contact as many people as possible, you try to convey your marketing messages effectively in the hopes that some of them will become clients. Reality is the exact opposite.
What if my Target Audience changes?
Your business’s specified target market isn’t future-proof. The type of individual most likely to acquire your items is impacted by the development of products and shifting consumer purchasing patterns.
“Even if you think you’ve identified your target market, keep in mind that running an ecommerce business takes ongoing trial and refinement.
The market and your company both undergo ongoing change. The astute business owner is aware of this reality and continually evaluates and adjusts their strategies to fit the needs”__Gerrid Smith, Joy Organics’ Chief Marketing Officer.
So how do you decide when to change course?
Changes in business strategy can help you succeed, according to Shaunak Amin, co-founder and CEO of SnackMagic. “When you feel that there is too much competition in your niche or you realise you’re not attracting enough customers to be profitable, changing your business strategy can help you succeed,” he says.
Conclusion
Any firm that wants to succeed over the long haul needs to have clearly defined target markets and target audiences.
Using a scattergun strategy will only get you so far, and that’s if you can even get past the starting line.
Therefore, put effort into figuring out who your company serves and why they should care. And keep in mind that testing is the only reliable method of determining who you should target.
Make sure that your items or services meet the demands or aspirations of your target market once you’ve identified them. Then specify your target audience—the particular demographic you intend to address with your marketing message. A tiny business will perish if it casts a wide net, so keep that in mind and be precise.
