How to find your target market for your small business
Defining your target market is an essential process for all brands, but it’s a particularly crucial part of the small business setup process.
This is mainly because approaching absolutely everyone as a potential target customer just isn’t realistic. It’s too expensive and time consuming to manage trying to reach that many people.
However, finessing your intended market allows you to spend your precious hours and funds on the people who are more likely to purchase from you. This is a far more cost-effective way of boosting your business than trying to grab the attention of anyone and everyone.
Below, we go through how you should go about identifying your target market, provide more details about why it’s so important, and share some examples of the kinds of different target audiences that exist.
How do you identify your target market?
To put it simply, you need to work out who your product or service might appeal to most.
We suggest writing down a list of each service you provide, the benefits that these services bring and who is likely to need them. For instance, if you’re a communications company, the perks of your press relations and press release distribution services are that they help brands achieve coverage in the media and as a result attract more customers and make more money. It’s too general to say that any business who is looking to gain these things is your target market, but from here you can start to narrow down what kinds of companies these will be. This might be dependent upon your specialisms, experience, where your business is based and what kinds of media relationships you have.
Or, if you’ve already started trading, take a closer look at your current customer base. Make a note of any common characteristics and think about why they have specifically chosen to come to you. This might help you identify others who might be attracted to your offerings.
Looking at who your competitors are targeting is another essential step. If they’ve missed a gap in the market, that could be your niche and unique selling point.
When defining your target market, it’s important to consider their specific demographic. Think about aspects such as:
- Income level
- Education level
- Marital or family status
- Ethnic background
You can also dig deeper and explore the psychology of your target audience. Make a note of different factors such as their:
- Personality traits
- Behavioural patterns
Thinking about the above will help you get into your target audience’s head and work out how they will use your product or service, what appeals to them, and where they get their news and information.
Assess your conclusions
Even when you think you’ve cracked it, be careful not to pat yourself on the back too soon. Once you’ve decided on a target market, be sure to consider these questions:
- How can I reach my target audience with my intended message?
- Are there enough people who fit my criteria in my location?
- Will my target really benefit from my product/service?
- Do I understand what drives them?
- Can they afford my product/service?
How do I find my target market online?
As mentioned above, looking at what your competition is doing can really help you define your strategies and target market.
Social media and web search engine tools such as Google will show you who your competitors are focusing on and whether those individuals also align with your business, too.
If you find you’re focusing on the same group of people as your competitors, don’t give up and decide to go down a different route. Instead, examine what they’re doing wrong and right and use this to guide your own marketing efforts.
Online tools can also assist when it comes to analysing current customers. Use social media polls, surveys, or even ask for feedback over email to try and determine what makes your customers tick and their particular demographics. To save yourself perhaps even more time, you can also look online for survey results that other people have gathered. However, make sure they are specifically about your target market otherwise it will hinder, rather than aid, your mission to find your target market.
Google Analytics is also incredibly useful as well. It lets you explore what websites your audience likes to visit and the keywords they search for the most.
Once you have your target market defined, you can use Facebook and Instagram can also prove handy as they let you direct your ads at those who meet your criteria.
What is an example of a target market?
To put it simply, your target market is who your product is aimed at. However, sometimes this differs to your target audience, who are the ones who will buy the product.
For instance, for McDonald’s Happy Meals, the target market is young kids, but the target audience for the ad campaigns are the parents of these kids. This is because the parents are the ones who will be buying and choosing the meals, and so you’ll notice that McDonald’s Happy Meal adverts tend to focus on the nutritional benefits of the dishes and other things that mums and dads might care about, rather than just how fun the free toys are.
Sports brand Nike also has an interesting target market. When it first launched it was marketed exclusively at professional athletes, however it then decided to expand and widen its appeal to more people. The ‘Just Do It’ campaign let it extend its reach to amateur fitness and sport enthusiasts, in particular relatively young ones who are interested in looking good, pushing their limits and improving their speed and fitness, and who have a decent disposable income.
As you can see, brands have all kinds of target markets and there’s a specific logic about how they identify them. Defining yours might take quite a bit of time and research, but doing it properly can really help make your small business a success.
For more business tips, take a look at our blog on 4 alternative free business tools to use.