Getting to know your target audience, and getting to know them really well, is one of the first things you should get to grips with when you set out to start your own business.
As a key element of your business plan it should also form one of the pillars of your marketing strategy.
How to establish who is your target market
You’ll probably have a rough idea of who you think would buy your product or service when you have your business idea, but confirming and honing in on key segments can be crucial to success. Research is key – both conducting your own qualitative and quantitative studies, as well as checking out the competition and who buys from them.
From here you can start to segment your target audience looking at:
Geographical segmentation – where they live, where they buy from. And bear your product or service (and the competition) in mind when you’re doing this too – if the market is too saturated in the area you’re initially looking at or if your product isn’t a good fit (for instance selling auto parts to the residents of Sark – a car-free island!) you may need to change location.
Demographic segmentation – here you’ll be looking at age, gender, life stage (whether they’re DINKYs (double income no kids yet), young parents, older generations), the household size, occupation, income and education.
Psychographic segmentation – what are their values, opinions and attitudes? What makes these people buy your product or service? This can be a very interesting area to look into, allowing you to really get under the skin and work out what makes your buyers tick. Are they open to risk? Do they spend or save?
With each of these areas making the effort to really understand your market can pay big dividends so it’s worth taking your time. If your product or service is linked to specific times of year or celebrations, for example you may also wish to look into behavioural segmentation to work out when people are most likely to buy your product. Additionally, if it’s a Christmas product should you stock up and start your marketing from September or earlier?
Getting to know your customers
Once customers start buying your product or service you can study your target market further and hone down on who you’re marketing to by collecting data on your customers. This doesn’t need to be invasive to your customers, but it can give you a great advantage both in creating long term loyalty and relationships with them as well as working out who else may buy from you.
Taking the time to create a database, with few restrictions on what information you can collect, can allow you to be ready with easy conversation the next time the customer comes in and will take even more of the guesswork out of demographics and psychographics.
Using your target audience data
Once you have a good idea of your target audience you can use the information to build the next stage of your marketing strategy – the channels that you could use to attract them. If you have the budget available companies such as Experian, who use their Mosaic classifications to profile customers and help you understand how to engage them, can be a useful resource. And again, researching the audience and reach of each medium and matching them with your own target audience is essential.
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