Not everyone is potential customer, it is essential to identify and have a clear understanding about target market to create an effective marketing plan.
Definition of target market
A target market is a group of people to whom a company want to sell its products or services. Each group can be split into subgroups. Age, region, income, and lifestyle are commonly used to divide segments. It is easier to decide where and how to market business once having established target audience.
How to identify target market?
Analyze product/ service
You can only define your target market if you clearly understand the benefits and characteristics of your product. Make a list of all the qualities of your product or service then list the pros and cons of that product or service. After you've listed your advantages, make a list of persons who will need that your benefit satisfies.
Conduct market research
Analyzing target market requires more than just understanding customers; you must also clearly understand the marketplace. Some of the most useful data can come from both recent and potential customers. Surveys, focus groups, and in-person discussions can help you to understand what target market needs, why they purchase the products or services, and what to do to make those products and services more attractive. Data from CRM could also be used to gain insights about customers.
Identify your customers
It is also critical to identify who your product or service is made for. Demographics describe baseline common characteristics features such as like age, gender, education, family status. Psychographics, on the other hand, provide a more in-depth view at who people are, such as their habits, beliefs, personalities, and lifestyle. When conducting a thorough research of your target market, it is critical to examine both demographics and psychographics. You must also determine whether your target audience includes individual consumers or other businesses. Individual customers normally have lower budgets and distinctive purchasing habits and businesses usually have a larger budget to spend on multiple products.
Create value proposition
Before defining value proposition, it is advisable to examine competitor social media channels and web site. Determine who they are marketing their product/service to and how to learn from it as an opportunity to distinguish your product from their offerings. Now that you've determined who your customers will be, you must examine your value proposition. Identifying the position helps to convince people that you are the best to solve their problem or fulfill their needs. Determine your unique selling point and promote it to the markets you identified previously.
Source: 1. nibusinessinfo.co.uk, 2. squareup.com, 3. smallbusinessbc.ca