Finding your target market (part 2)

Last week, we discussed the importance of having a focused strategy on defining your ideal customer.  Today, we take a look at some of the key factors to help you identify your target market.

When defining your target market, keep the image of an actual target in mind.  Demographics alone, such as age, gender, income and occupation do not provide enough insight into the attributes of your target customer.  Imagine a circle with the outside being the universe of potential customers, that is, everyone who might possibly be interested in your product or service.  As you get closer to the centre of the target, focus on customers who are more likely to actually make a purchase.  The group at the centre should be those you would most like to have as customers, who you can reach and sell to affordably and who are most likely to buy.

Some factors to help you close in on the bulls-eye;

1.  Features and benefits of your product or service: which group is your product/service best suited for?

2.  Competition: is there a segment of the market that competitors are not reaching or under-servicing?

3.  Market trends: is there one part of the market for your product/service that is growing?

4.  Most motivated buyers: which part of the market has the most immediate need or desire to buy your product/service?

5.  Most ability to purchase: what type of customer is most likely to have the disposable income to spend on your product/service?

6.  Ease of reaching your prospects: is the part of the market that is easiest to tell about your product/service such as trade shows, media such as magazines or other communications directed specifically at them?

7.  Ease of selling to your prospects: are there any existing distribution channels such as specific stores, websites or wholesales that make it easier or less expensive to reach one part of your market?

Our guide to Buying and Running a Small Business looks at this is more detail.  Contact us to find out more.