Finding your target market is especially important if you're selling a service, running a store, or getting readers to read your online articles. Understanding your target market will go a long way in helping you develop new products and market them effectively. If you run a business, starting with simple research on your customers and competitors will help you determine your target market right away.
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Part 1 of 3: Answering Questions About Your Business
Step 1. Think about the problem your product or service can solve
If you want people to buy your product or service, make sure it can help people solve their problems. For example, your product can solve the problem of people's need for modern clothes at affordable prices.
- Problems identified can vary, as long as you're sure there are plenty of people with the same problem that fit your business.
- Find problems that your product can solve specifically. Identifying too general a problem, such as the need for food, does not help. You can start with a common problem, but narrow it down by asking a few follow-up questions like “Where do people need my food?” or “What food does my customer need?”
Step 2. Pay attention to your competitors
Think about the types of businesses that offer similar products or services and how you would differentiate them.
- If you have a physical store, your competitors may be businesses in the same area. If you have an online business, you will need to do some research to find out what options potential customers have. Quick online research by typing in keywords related to your business can help identify online competitors.
- As soon as you find out who your rivals are, do some research on them. You need to know things like their hours of operation, how many products they offer, or the shipping charges they charge customers. The goal is to identify problems your prospect is having that your rivals can't solve.
- It's natural that you're not the only one offering a solution to a particular problem, but you should try to make as much difference as possible. Make sure your product or service is unique and easily recognizable.
Step 3. List customer characteristics
Once you understand what problems your product can solve, you can begin to think about what kind of people might have those problems. Record as many characteristics as you can imagine about the ideal customer.
Again, try to be as specific as possible. For example, you sell organic food for dogs, your list might include those who have pet dogs, are nutrition savvy, care about sustainable agriculture, and so on
Step 4. Pay attention to the price of the product
If you have already set a price for a product or service, compare the price to the available similar product options. If you still haven't set a price, we recommend doing the following research to determine a reasonable price.
- If your product is more expensive than others, you should be able to explain to your customers its advantages.
- Also think about the types of people who are willing to buy your product and whether customers will view your product as a staple or a luxury item.
Part 2 of 3: Doing Market Research
Step 1. Find out who your current customers are
The best way to know who will buy your product is to know who has already bought it. Use this information to target other people with similar interests or those who fall into the same demographic group.
- If you have a store, pay attention to the people who are your customers. You can tell a lot about them just by observing. You can also engage them in conversation, ask them to fill out a survey, or create a rewards program that requires customers' personal information to get to know them better. The rewards program also allows you to track customer purchases which helps you identify certain products that customers really like.
- If you have a website, Google Analytics tells you how many people are currently viewing your site. Many social media, including Facebook, Twitter, and Youtube also have “binoculars” or “analyses” that provide information about demographics and interests.
Step 2. Find out about your rival customers
If you don't have a store or website yet, you can get a lot of information about potential customers by researching your competition. Even if you already have a store or website, you can still do it because this will show you if your competition is more successful at attracting customers than you.
- You can also learn basic information about competitors' customers by visiting social media accounts and viewing followers' profiles and/or comments. You can find out the age group of the follower.
- If a competitor has a store, take the time to visit and pay attention to the customers who shop there.
Step 3. Review existing research results
There is a lot of market research that has been done and it can be used for your business. Search online for information on market research, target markets, or customer profiles for your line of business. The data may not be exactly what you would get if you did your own research, but it does provide additional insight.
Commercial news can be a good source of information
Step 4. Do your own research
If you've done a lot of online research and observed customers, you may need opinions from real customers. You can do your own research although you can also hire a professional from an agency if you're not sure how to get good participants or translate data.
- Ask customers to fill out surveys, either online or in-store. You can ask about their demographics and interests, their response to your product, and the products or services they would like you to provide.
- If you want more people to take surveys, you can try paid online surveys. Several companies including Swagbucks and Vindale Research can display your survey online for a fee.
- You can also hold focus group discussions if you want to get more detailed information about how people in the group feel about your product or service.
Step 5. Complete the customer profile
After answering all your business questions and conducting market research, you can finalize your ideal customer profile. If you have more than one product or service, you can have a different type of ideal customer profile for each product or service. The profile should include a mix of demographic information that will enable you to understand the socioeconomic status of the customer, and psychographic information that provides insight into the customer's personality.
- Important demographic information includes age, racial/ethnic background, gender, marital status, education level, occupation, income, number of children and location.
- Important psychographic information includes hobbies, interests, beliefs, religion, lifestyle, and technology choices.
Part 3 of 3: Using This Information To Grow Your Business
Step 1. Target customers where they like to spend time
Once you've got a customer profile, you can do some online research to find out what habits these people usually do. Knowing their habits will help you make smart decisions about where and how to market your services.
- It's a good idea to find out if your target market prefers shopping in-store or online; how much time they spend on the internet, watching television, reading magazines, and listening to the radio; and the sites visited, television channels, and publications read.
- You can take advantage of social media analytics such as Follwerwork which helps to find out more about the habits of your target market. If you know that a large part of your target market is a fan of a particular company, you can borrow ideas from that company to capture your target market.
- You can also do research to answer the questions above. This is especially useful if you want to know the habits of certain groups in your area. Form a group of people who represent the target market.
Step 2. Market the product according to customer values
Once you understand your target market, you should be able to create a suitable marketing campaign. Whenever you create a new campaign, always use customer profiles as a reference and ask yourself if the campaigns you create align with the data you already know about your target market.
Step 3. Send out special promotions
If you already know your target market and have collected data from customers, use this information to group customers according to their characteristics and make sure customers are always informed about your store that is related to them.
- Say you own an online pet clothing store, use past sales data to group customers into three groups: dog owners, cat owners, and dog and cat owners. That way you can send promotional information to customers according to the products they are interested in.
- This information can also be used to develop new products or services to meet the needs of each group.
Tips
- You can ask friends and family for advice, but don't make the mistake of taking it as legitimate market research. You should keep trying to get feedback from people who represent your market.
- Your target market may evolve over time, and this is natural. Don't stop doing market research.
- Avoid making assumptions about the target market based on your own prejudices.
