The goal of most businesses is to maximise its return on marketing investment. Growing its customer base on an on-going basis forms the foundation of this goal. In general people purchase a business’ products or services for three reasons, namely to help them satisfy a need, as a solution to a problem or to make them feel good. As a starting point, the business must decide which of these reasons it plans to target. There are chances that more than one of these reasons applies.
Based on this, the business must find the niche to focus on. Target marketing lets you direct your marketing efforts, rand and brand message towards the specific market that is more likely to buy your products. It is the most effective way to reach your buyers and grow your customer base.
How to identify your target market
A target market can be defined as a group of prospective customers with similar needs, who are most profitable for your business. Your marketing efforts will focus on these specific needs so that the final product appeals to the target customer. The product will finally reach the customer via short-term and long-term marketing strategies.
- Start by looking at your current customer base – who they are, why they buy from you. Identify common characteristics and zero in on what brings in the most and best business.
- Look at your competition’s market, their current customers and find a niche that is being overlooked by them.
- Analyse your product or service, listing its features, advantages and benefits.
- Decide which demographics to target based on factors such as age, location, gender, income, education, occupation etc.
- Now look at the psychographics based on factors such as personality, attitude, values, hobbies, lifestyles, behavior and decide where your product or service will fit in their lifestyle, the media they frequent for information.
Based on the above information, decide whether you have an adequate market based on your criteria and whether they will benefit from your offering. Based on your findings, you can design your marketing approach and sales activities to meet the needs of your target market.
How you target your prospective customers will depend on your short term and long term marketing goals as this will have a critical impact on which strategy you choose.
While long-term marketing strategies focus on building brand awareness in the specific niche in your target market through a gradual increase in sales, short-term marketing focuses on generating immediate revenue.
- Long-term strategies include branding activities that aim to build the business’ image and customer loyalty, relationship building strategies focused on the business’ associates, partners and market and research and development efforts to create the right products for future sales.
- Short-term strategies are focused on creating sales from the word go and the results are measurable. Short-term strategies include activities like cold calling and setting up appointments for sales calls, product demonstrations or negotiations. Short term strategies also use price discounts for a spurt in sales, group deals to promote to new customers, and other advertising methods that can yield immediate results.
Together, short-term and long-term strategies help the business meet its revenue goals while creating on-going relationships with customers, building its reputation and growing a loyal customer base in its chosen niche.