It’s important to remember that the focus of marketing is people (customers). If you’re concentrating your efforts on your product or profit only, you’ll miss the mark. The term “target market” is used because that market-that group of people-is the bull’s eye at which you aim all your marketing efforts. All small businesses need to study and develop a thorough knowledge of the importance of target markets.
Marketing to people with common characteristics that set them apart as a group is what defines “target marketing”. The more statistics you have about a target market, the more precisely you can develop your strategy. As a small business owner you need to know as much as possible about your primary trade area. There are numerous data company that will help you with general demographic data for free. Melissa Data, http://www.melissadata.com is a great source for target marketing information.
Understanding market segmentation is crucial for working out a well-crafted marketing strategy in today’s competitive world. Here are a few different types of market segment shared group characteristics.
1) Demographic Segment Measurable statistics such as age, income, occupation, etc.
2) Psychographic Segment Lifestyle preferences such as music lovers, city or urban dwellers, etc.
3) Use-based Segment Frequency of usage such as recreational drinking, traveling, etc.
4) Benefit Segment Desire to obtain the same product benefits such as luxury, thriftiness, comfort from food, etc.
5) Geographic Segment Location such as home address, business address, etc.
Here are examples of target segments that can be created using the above market segment shared group characteristics:
1) You want to reach Men 55+ with a household income of $90k, that work in a white collar capacity. 2) You want to reach Jazz music lovers from the inner city who like local artist. 3) You want to reach customers 21+ on Fridays and Saturdays with drink specials. 4) You want to reach luxury vehicle owners, that have their cars detailed monthly. 5) You want to reach all occupied dwellings nearest your location.
The reason you must identify a target market is so that you can easily and cost-effectively create strategies for designing, pricing, distributing, promoting, positioning, and improving your product, service, or idea.
For example, if research shows that a sturdy recyclable package with blue lettering appeals to your target market and if you’re focused on that target market, you should choose that type of packaging. If, however, you are product- or profit-oriented rather than people oriented, you might simply make the package out of plain Styrofoam because it protects the product (product-oriented) or because it’s cheap (profit-oriented).
Here’s another example: If you know your target market is 24- to 49-year-old men who like R&B music, frequently purchase compact discs, and live in urban neighborhoods, you can create an advertising message to appeal to these buyers. Additionally, you could buy spots on a specific radio station or TV show that is popular among these buyers, rather than buying general media time to “try and cover all the bases.”
You need to create a baseline with your advertising and marketing efforts. This can be done in many different ways, data and numbers don’t lie. I always feel comfortable sticking to the nums and figs. With that being said, fortunes are made by risk takers. A mix of these in your marketing approach could be advantageous.