How To Determine Your Target Market

You can reduce your marketing costs and increase profits by targeting specific groups of people when you market your business. When you understand your target market, not only will you easily reach them, you will also be in a better position to provide services and products tailored to their needs. Here are 5 steps to help determine and better serve your target market.

Step 1: List the types of services or products your business provides. For example, if you run an Accounting and Taxes firm, list the types of services you provide, such as general accounting, tax preparation, notary public, eldercare accounting, and payroll services. The services  you offer will determine if your firm caters to businesses rather than individuals. If you can determine which of these markets your business caters to the most, then you can narrow your search by targeting specific industries or types of consumers.

Step 2: Create a profile for your ideal customer. A customer profile is a list of descriptors such as gender, age, industry, profession, ethnicity, education level, income and lifestyle. Understanding the types of people or industries interested in purchasing your goods and services allows you to market directly to them instead of marketing to a general group. While you should still market to those outside your target market, most of your marketing efforts should be toward this group. One way to create a customer profile includes writing and distributing a survey to existing customers via email, traditional mail, by phone or in-person when they visit your place of business. Another way is to review sales records for the past year to determine which industries or types of consumers purchased your goods and services.

Step 3: Gather information about your customers via a survey. Include questions (multiple choice, fill-in-the-blank, yes or no) to determine the average age of customers, income level, occupation, number of times they use your goods and services each year, reasons for purchasing and other places they go to purchase the same or similar goods and services. Include a comment box so customers can express their opinions about your business or ask for additional goods and services. Place this survey on your website so it will pop-up when people visit your site. Add the survey to your business social media page to gather even more information. Analyze this information to determine which age groups, income levels, industries or specific customers, such as parents, working professionals or retirees, are most likely to make a purchase.

Step 4: Research your competition. Learn what other businesses have done to increase their sales by reading industry reports, business articles or by visiting competitor websites and social media pages. Create a list of markets your competition has cornered to see if there are smaller niche markets closely related to those larger markets that could be profitable for your business. For example, if you are in the event marketing industry and your competition is profiting from doing events for hospitals, investigate the possibility of doing events for medical doctors, dental facilities and other associated niche market in the healthcare industry.

Step 5 – Determine the best ways to reach your target market. Online marketing may be the best way to target younger audiences like the Gen I, Gen X and Gen Y; while business networking events, trade shows, community networking events and cold-calling may be the best ways to reach business owners. Review your customer surveys and take note of which surveys (online, email, traditional mail, in-person) receive the most responses. This may help you determine the best ways to market to a specific group.

Do share with us if you are already engaged in these target marketing activities and how they are working for you. We welcome any comment that can enhance this process.