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!