Identifying Target Market is Critical for Business Success

Target Market

Knowing your buyers is beneficial for your business. Understanding the reason they buy your product or service is always good to make your business excel.

Do you know you’re your customers? Who are the best customers for your products? What type of people or background do they come from? These are some questions you need to prod to understand your customer better. After all, they are the ones putting your bread on the table for you.

Acquire Demographic and Lifestyle Information of Customer:

The sale of products and services directly to the end-users, it is essential to know who your target audience/customers are and why they buy your products. This is called Demographic information.  You will need to have demographic information and lifestyle information if you are selling products directly to an end-user. This information helps in two important ways.

  1. It can help you make changes to your product or service, to better match your customer’s needs.
  2. The collected information tells you how to reach your customers through advertising, promotions, etc.

Demographic Information: Here, the information is tangible and measurable about the individuals or groups of individuals. Some of the common demographic measures are age, gender, income level, education level, racial/ethnic identity, marital status, size of household, number of children, occupation, geographical location/size of the community, etc.

Related: Execute Your Business Successfully With These 5 Essential Traits

A small business owner can easily acquire demographic information.

Lifestyle Information: Lifestyle information usually focuses on intangible characteristics that make the buyers unique. While demographic information can give facts about the consumer or a group of consumers, lifestyle information addresses what meaning the demographic information has to the consumer.

Lifestyle information can be classified into four broad types.

  • Psychographics: It refers to personality and emotionally based behavior linked to an individual’s purchases.
  • Social Factors: This refers to the choice of hobbies, recreational pursuits, entertainment, vacations, and other non-work time pursuits.
  • Belief and value systems: This taps the awareness of the religious, political, nationalist, and cultural beliefs and values of your customers.
  • Life Stage: A focus on lifestyle variables goes to the experience of people of different ages and in different life roles.

Companies and brands usually look for a relation between demographic and lifestyle information to identify and market to the customers.

Learning about Customers Effectively:

In this digital age, the playing field for both big companies and small businesses have leveled. There are numerous excellent and reliable sources of data available with just a click of a button these days. While a multinational company has to invest hundreds or thousands of dollars to set up focus groups, surveys, and customer advisory panels, small businesses just need to sport a friendly smile and have the willingness to ask a few valid questions.

Related: Business Success relies on Successful Marketing

Questions you ask your customers should be as follows:

  • “Have you tried [your product] before?”
  • “Why are you buying this?”
  • “What do you like about it?”
  • “How’s it going to make your life better/easier?”
  • “Who’s going to use it?”

Segment the market to Drive Growth:

It is good to see the entire universe as your market. However, dividing the target market into segments can generate more revenue. Segmentation of the market can be based on the demographic and lifestyle information we have charted previously. You can generate solutions that resonate with the target groups.

Almost all marketers know of the fact that “20 percent of buyers consume 80 percent of product volume”. If you can identify the 20 percent and find a similar target audience like them, you are bound to sell more products with much less effort. These buyers can be branded as loyal customers and can be thought of as a niche. Niche marketing is targeting, communicating with, selling, and obtaining feedback on the heaviest users of the products and services of your business.

Related: Lucrative Marketing Plan for a Successful Business

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All Comments

  • Avatar Dan Begue

    Great Stuff!

    8 months ago | 16 April, 2020 8:28 pm Reply

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