How to Define Your Target Market

Targeting a specific market for your business isn’t as easy as it seems.  Most businesses say their target market is anyone that is interested in their widget.  However, not all widgets are created equal or generate the same interest level to a potential customer.

A great example of this would be satellite TV programming.  A customer that loves movies might purchase a package upgrade based on additional movie channels offered even if the price is higher than other packages while at the same time ignoring offers for sports channel upgrades if they are not a sports fan.  Therefore, “Anyone” interested in your widget does not work.  Here are some ways to better define your target market.

Demographics and Psychographics

How to Use These Criteria to Help Define Your Target

Recently I helped a new fitness club with a direct mail project announcing their grand opening. The postcard included a coupon for one free exercise class. We created a targeted list by nailing down specific criteria that would yield a better response rate.  The list generated included an income of 100,000+, Age, radius of 2 miles from business location, interested in health and fitness.  The response was overwhelming and the customer was pleased.  However, if the mailing would have delivered to everyone within a 2 mile radius the additional expense would not have justified the return on investment (ROI). Mailing lists are a great way to target a specific group for a direct mail project.

Demographics can determine the need for your product.

Income Level

Gender

Age

Location

Occupation

Marital Status

Ethnic background

Home Owner

Psychographics details the characteristics of a person

Interests/hobbies

Values

Lifestyles

Behavior

Who Are Your Current Customers

Look for reasons why your customers buy from you.  Would other people like them also buy from you?  Think about a B2B customer base.  If your customer is a chiropractor and he buys widget #1 and widget #2 would it not stand to reason that another chiropractor might also be interested in Widget #1 and Widget #2? Look for common characteristics in your customer base. Who are your competitor’s customers?  Perhaps you can fill a niche that they are overlooking.

Evaluate Your Products and Services and Message

Your message should be targeted to each niche market for it to be most effective.  It is also a good idea to take each of your products and services and write out a defining feature next to each one.  Who might benefit from this feature?  Each feature may start to define a separate target audience for the same product as shown in the satellite TV programming example.

Once you figure out “who” your target market is it becomes easier to tailor your marketing effort to their specific need.  Unique marketing ideas are a great way to target those niche customers and perhaps discover some new ones.