Defining your target market is essential to having a successful business. A business's target market will determine everything from its location to product pricing. Without taking the time to define your target market, it is likely that you will waste precious time and money catering to people who are not interested in your products and services at all. It's not difficult to define your target market, and you can do so by answering the three questions below.
What is the age, gender, and socio-economic status of your ideal potential customer?
Let's suppose that you sell genuine designer handbags. Your customers are not likely to be those on a budget, and are probably not men. To market your purses to everyone would be a waste of resources; it would make more sense to only go after people who want to buy your products, namely women with cash to spare.
Likewise, if you sell babysitting services for toddlers, you shouldn't be marketing to people without children, the elderly, or stay-at-home moms.
What publications do your potential customers tend to read; how do they get their information?
This question is important because it will help you figure out how to reach your target market, which will in turn help when it comes to marketing, advertising and public relations. You need to figure out which types of media--television, newspapers, magazines, websites, social networks your target customer is likely to use. Going back to the example of owning a business selling designer handbags, it's true that your potential customers would likely be into fashion, have money to spend on luxuries, and watch out for the latest style trends. Knowing this, it would be reasonable to assume that they read high-end women's fashion magazines, style blogs, and frequent fashion shows and events. Therefore, it wouldn't be wise to market to this type of customer in a newsletter about bargain fashions.
What about your product or service will your potential customer find attractive?
This seems like a simple question, but it's very telling. If you are selling luxury handbags, the question to ask is "Why would my target market buy these purses?" The answer would be because you're selling an authentic, luxury fashion item; your target market is into trends, and wants the latest and the best. Answering this question will help you figure out pricing, too. Since your target customers are into fashion and don't mind paying for genuine items, you can charge a premium. On the other hand, you wouldn't want to under price your items because that would affect your customer's perceived value of the items you're selling, which would lead them to question the authenticity of your handbags.
Once you figure out who your target market is, you will know how to reach potential customers. Your business will run more effectively once you determine exactly who is likely to buy your products and services, and you won't waste time, energy, and money selling to the wrong crowd.
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