How do you define a "target market"?
I see a lot of responses on mosaicHUB that your business has to start by defining a "target market." When I googled it, it seems like its just figuring out who will buy my product. Is this correct? If so, where do I start?
Yes, very correct. You always want to present your product/service in a manner which interests your target market - aka your target type of customer.
For example, you wouldn't market to teenagers the same way you do to senior citizens.
Start simple. Ask yourself, "Who would be interested in my product/service?"
A lot of entrepreneurs make the mistake of thinking, "Everyone will love it! It's a product or service for everyone." While you may THINK that is true, there is always a more targeted group of people that you should focus your initial marketing efforts on. These are the customers MOST LIKELY to be interested.
To break that down you really need to consider many factors. For example a product for fishing primarily applies to males, but not all males are interested in fishing. Taking it a step further, a product for deep sea or ocean fishing, probably won't sell well in places like Nebraska where they aren't in close proximity to the ocean. These are factors you need to consider. Simply marketing toward males interested in fishing isn't ideal.
As a start-up, you can't afford to spend time and money marketing toward a demographic that MAY be interested. You need to focus on a smaller segment to maximize your marketing ROI - the return on investment your marketing dollars bring.
Use Google to search. See what comes up with various keywords for what your business is and see what kind of people are talking about it. That should help you get the initial target narrowed somewhat.
If you already have a product or services which you want to sell, then "Target market" is a customer segment where you think your product and services would be easily accepted and you can grow your market share and make some profits. there may be more than one target market suiting your product, do SWOT analysis and evaluate which target market would help you in achieving your revenue/profit goal with relatively less competition.
if you are clear about :
WHY you are looking for target market,
WHAT you want to achieve from the target market (volume/value/etc)
WHEN you want to achieve (timeline)
you will be able to identify the customer segment where you would like to position your product and services. That customer segment becomes your "Target Market".
If you would like to know more, please feel free to write to me... Good Luck!
I think a good deal of those that have answered this post have picked up on several key ideas. It is indeed understanding the group of people that will buy your product; however, it is critical to also understand your product is and how it will satisfy an unmet market need. Knowing both ends of this relationship is critical to launch a product as well as keeping track of how your product can also be expanded into other markets as it evolves.
In fact this is the segment of the market that will be interested in your services or products according to your experience/market research based identification.
From my own perspective, if we want a real genuine positive outcome, a target market should be defined and explored by most importantly the DIFFERENCE it will make and by the POSITIVE seeking results that can be brought about and for which will be benefited from identifying and wanting to service that specific market. Implementing key products or services to targeted markets based on beneficial mutual strategies can carry, to further extents, the creation of a greater regional impact outcome. Business strategies in pinpointing target markets should always compliment to further upscale beyond the benefits of sales or financial revenues. The reason should always be more than just the money.Entrepreneurs should keep that focus in mind before making their final decisions based on target markets. The target market should be a location of interest to the entrepreneur or company. The results can be mutual financial gains but it can also be based on identifying problematic issues from those targeted market that will help to enhance the bettering of these regional problematic issues for that specific area. Questions we should ask ourselves are: Can we make a difference on that market with the offering of our products or services? What are the high and low strategic key factors? Are our products or services suited to fit that targeted market taking into consideration all necessary variables? The target markets need to add value to the business purposes and the products or services need to add value to the target market purposes - a joint effort. It is not simply based on financial gains but also on efficient predetermined values for both.
Ms. Dale M. LeBlanc
What's the problem you solve, or the need you meet? Once you answer that, examine who actually has that problem or need. What other characteristics define that person or people? People don't buy products or services. They buy solutions, they buy something because it meets a need. Do you know the need your product or service meets?
In my humble opinion a target market relates directly to your value statement. Where does your product or service make the biggest impact? Where do you as a company provide the best value, I would assume that would be your target market.
A good starting point is to determine if there is a product/service already in the marketplace similar to the one you want to market. If there is, you're job will be a bit easier. You can then do Google searches to determine where these products or services are being marketed. Look for what kind of positioning these searches show for the products/services by going to the web sites you get from your search. This will at least provide you with a foundation to do more homework to find out who the people are that are most likely to buy!
Some marketers say you should define your market in as exact terms as possible. Who is the ideal perfect customer? For Example; a 38 year old female with children in the household under 12 who own a home. Others indicate that you need to start with a broader based age range and fewer qualitative qualifiers. Either way, the smaller the number of qualifiers, the broader the market will be, but also, the broader the competition is likely to be.
Personally, I'm a fan of the more defined approach.
Defining a market involves definition and sizing of all the dimensions of the marketplace for your product or service, including Who Buys, Why they buy, How they buy, how much will they buy much and why, based on dependent factors and assumptions for these estimates, including product creation/manuafacturing requirements based on demand, pricing, competition, your strengths and weaknesses (for getting your product noticed, creating demand, managing supply, means for getting the product to buyers and delivery factors). Defining all the factors for demand-generation, i.e., marketing, sales, unit profitability, project sales volume and profitability for a designated period of time must be substantiated with justifiable assumptions. Projection models are needed for product sales, revenue, profits(revenue less direct and indirect costs) supported by justified assumptions. (Don't forget investment costs/funding that would then be required for the designated marketing period projected).
At the simplest level defining your target market as "who will by my product" works, but it can be a quick way to run through your investment. The "who will buy" is considerably less important that identifying the ideal characteristics of your paying customers. I don't know your business so I can't speak specifically to your need, but let me illustrate with how you might identify a target market for a new health club. The broad definition of your target market for health club members may be anyone who wants the benefits of exercise. The ideal characteristics will help you focus on the most appropriate users for your products. These may include age, ability to pay, their personal objective (weight loss versus improved health versus meeting people to date), proximity to gym, sex (cater to male and female or focus on one group), hours available, preference for solo-training, classes, or personal trainer availability, and more. Once you understand your customer's needs you have defined your target market. Then you have fun figuring out the best marketing tactics so as not to waste resources chasing the wrong people, and ensuring the ongoing satisfaction and loyalty of your customers. Hope this helps!
Yes this is partially true with some additions such as surveying who needs or desire the products or services you offer, you can do a survey using social media and internet , telephoning , observing similar business's and the way they operate their marketing campaigns, use e-bay and amazon , facebook.com.
Lynn, yes the activity you mention in your note in regards to identifying who will purchase your product is correct. Initially you will need to understand what your capabilities to deliver the product. If you are targeting Wal-mart and you do not have the capabilities to deliver the volume it will have a negative impact on your company. Also need to consider to you initially pitch to local companies, then regional and then nationally. Selling your product to businesses vs. consumers require different tactics.
I recommend browsing "Crossing the Chasm" by Geoffrey Moore. It is about how you get started. Exactly, who do you sell your product to?, or more defined, who do you sell your product to first? Is their a group of people you know how to reach, and about who you know what they need and you can offer? Start with them first. When you "own" this community, define the next one. Eventually you will have enough momentum going for you that you reach the "Tipping Point", another great book. This by Malcom Gladwell about how your worthwhile offering, your sticky message, gets represented by different "ambassadors", connectors, experts and sales-people who help spread your message until everyone is talking about it. Books on Lean by Eric Rise, Steve Blank and Ash Maurya offer helpful approaches on how to do customer experiments to.
I cannot claim to be an expert in this area, nevertheless, I want to agree with this Single Line explanation, which you got from Google.
The ultimate aim of an Producer is that someone should buy his/ her product in the market. Now this 'Someone' has to be the TARGET MARKET for the Producer/ Product. Now a days, we don't live in a monopolistic world, where anything which is produced will definitely be sold, so long its Supply does not exceed the Demand. I may give you an example to elaborate this further. Soaps have been an essential part of our life for centuries. Someone got an idea to improve the sale of its soaps by launching a product keeping a 'Target Market' in view. So the Company launched 'Lifeb.....' and pushed the idea that this soap is to take care of one's hygienic needs. Although, everyone wants to remain clean, the level of awareness and concern about the hygiene is not the same. Therefore, those who expressed/ showed more concern about importance of hygiene in life became the 'Target Market' for this product. And who know this product, they know that this product got a very long life Cycle. The survival of this product for a long period has been possible mainly because the product has still got its Target Market.
I hope that this will help you.
This is something very basic learnt at all business-related universities.
When you add some professional experience things come easier and results are achieved.
I see you need someone to guide you since the beginning. If you need a help from a professional with 15 years experience, you can call me. Andrey
Lynn, when you are defining your target market, you can think in terms of primary (those who are most likely to buy/be repeat buyers/referral sources; secondary and tertiary. Having an understanding of your market and their desires will help you develop your business. Be careful in defining your target market to avoid getting hung up on demographics. While they might be useful for many consumer products, it might not be enough for your product or service. Looking at lifestyle, behavior, values, competitive products also consumed etc. will help you get a better understanding of your target. If I can help you get the information you need to develop your business, please feel free to contact me at firstname.lastname@example.org.
As the name implies, target market is the cross section of people in your vicinity, personal or virtual who will be most likely to buy your product/services
A target market is a segment of customers or a niche collection of customers that have the greatest propensity to buy your products, as opposed to the entire market of customers. Target marketing is designing a marketing strategy that is directed to that specific collection of customers.
Lynn: You have been given some very good answers to your question. We all realize that there is no such thing any more as a mass market. The marketer now must segment the total mass (defined differently for business vs, consumer) into categories often defined by demographic, psychographic variables, interests (e.g. golfers, tennis players) , technological factors, etc. The targets are then selected from these segments.
But allow me to put a slightly different spin on the comments already given. The target market is not necessarily the segments considered to be the preferred customers. The targets that should be defined and selected should be the buying influences. Several examples: child is the influence while parent is the customer; with autos-males are often the buyer but females are the buying influence; in business transactions, there are usually 4 buying influences in almost every business transaction. All 4 must be sold before a transaction will be consummated.
Hope this helps. Please contact me if you want to explore this question further.
Hi Lynn, a target market is a set of audience which has similarities in attributes; Demographics, Buying behavior, Income groups, Ethnicity, Religion etc. The logic behind this is, the probability of a purchase to occur will be higher amongst a target market if there is a demand or Need or Want for the product/ service a business offers.