New businesses often struggle to define their target market and they aim their products and services at an unreasonably wide market. Many small businesses believe that they can be everything to everyone, but this inevitably leads to a lack of clear direction. It’s actually more helpful to realize that most people are probably not going to be interested in your products and services. Identifying your target market is critical to your success. When you understand who your potential customers are, it will help you target the right channels and make your marketing messages more powerful. While optimism has its place in business, it’s more important to be realistic about the potential of your business. Many consumers may not be interested in what you have to offer, but by focusing your attention on the minority of people that will benefit from your products and services, you at least give yourself a chance to succeed. This is the basic principle of niche marketing, and it’s key to attracting more qualified prospects to your business.
Everyone Is Not Your Market
In such a crowded marketplace, defining your target market is more important than ever. By targeting a niche market, small businesses can effectively compete with larger companies. Unless you have unlimited resources, it’s simply impossible to target everyone. Target marketing enables you to use your marketing budget more effectively and reach the people that are more likely to want to buy from you. Not only can you find more appropriate platforms to promote your business, but you can also tailor your content to have more impact.
While some people think that their marketing materials should appeal to everyone for maximum exposure, it can actually drive away the very customers you want to attract. Instead of wasting time trying to sell something to the wrong audience, it’s more cost-effective to sell to a small group that actually wants your products and services. In other words, it’s far better to start small and build a small customer base and then expand your audience later if you need to.
For many small businesses, focusing on a specialised but profitable corner of the market is key to long-term success. Being clear about your target market is essential – without clarity, you end up being all things to all people, your branding becomes vague, and potential customers become confused about what you are actually offering.
Identifying Your Target Market
Careful planning in the early stages of setting up your business should help you identify your products and your potential markets. Your initial market research can take many forms such as direct mailing, personal interviews, social media questionnaires, and industry research. Another effective market research tool is Google Webmaster Tools. By using its keyword planner tool, you can find out the number of people searching for words related to your business.
First, you need to understand what problem your products or services solve. You can then use this information to find out who would be willing to pay for a solution. But before you go chasing customers, you must be clear about your personal strengths and weaknesses. What are your particular areas of expertise? Do you have specialised knowledge of a particular geographical area? Do you already have links within a certain industry? All of these factors can help you refine your target market.
For example, an electrician who targets local businesses will be a more attractive proposition if he or she markets the business as ‘Electrician to local businesses’. By focusing on this smaller section of the marketplace, the electrician knows which websites and local publications will be better for marketing, and which local networks to attend.
Essential Tips to Help You Identify Your Target Market
- Look at your existing customers. What is their demographic? Which type of customer tends to spend more with your business?
- What is the persona of your target market? Find out what other products your customers buy. What do they value in life? What are their interests? Where do they go to online for information and entertainment?
- Look at your competition. What is their target market like?
By finding out more about your existing customers, you can tailor future marketing campaigns specifically toward them. You can speak in a language that they relate to, and you can focus your content marketing efforts on online and offline platforms that they engage with. By knowing more about your competition, you can also try to capture a niche market that they are overlooking.
Create Your Ideal Client Profile
When you think you’ve done enough research, take time to form a picture of your ideal client.
Ask yourself the following questions:
- What is their age, gender, and marital status?
- What is their occupation?
- What is their philosophy?
- How do they spend their leisure time?
- Why does your ideal client need your product or service?
- Why do they choose you over the competition?
The more you get to know your ideal client, the better you can become at solving their problems and presenting your business as the best solution to their needs. You can also assess whether there are enough potential customers to satisfy your long-term business goals, and you can modify your pricing to suit their budget and expectations. If necessary, you can start to cater to more than one niche market. Just remember to tailor your marketing messages to each audience sector.
The Importance of Brand Positioning
Many newbies in business underestimate the level of competition in their industry. Do you know how many other companies are aiming their marketing messages at the same audience that you are? What do you offer that’s different from your competitors? What is better about your product or service? Perhaps, it’s not better, just cheaper. Whatever it is, make it clear to everyone, so that you can still attract potential customers even if you technically sell the same products or services as other companies.
Think about your business website. What does the homepage say about your company? Is it compatible with your brand’s personality? Is it clear why visitors to your website should do business with your company and not go to a competitor? Effective brand positioning is all about highlighting your strengths and your unique selling proposition so that you stand out from the crowd, wherever the customer sees you.
Context marketing is delivering the right content to the right people at the right time. Once you know who you are targeting, you can decide which are the best channels to use to promote your business. Instead of sending direct mail to everyone in your town, you need to track down and target the most qualified prospects. Instead of posting Facebook updates at the same time every day, you need to find out when your target market is most likely to be on Facebook and deliver content then. It’s about using what you know about your target audience to provide relevant, targeted, and personalised marketing. Context marketing has multiple benefits:
- It can save you money and give you a better return on your investment
- You can address the specific pain points of your audience
- You can tailor the language of your marketing to suit specific audience segments
- People are more likely to remember your brand in the long term
Your marketing options are only really limited to your imagination. There are so many channels you can exploit to reach your target market, and they can encompass traditional and modern methods. Here are just a few:
- Advertising on radio and television
- Advertising in trade journals, magazines, and newspapers
- Yellow Pages
- Direct mail
- Local workshops
- Business newsletters
- Press releases
- Trade shows
- Writing articles for magazines or blogs
- Social media marketing
- Website advertising
- Search engine optimisation
It’s essential that you understand where your target market is located. Where do they go to get information and entertainment? This includes which online platforms they spend their time on – this is especially important when it comes to social media marketing. Your unique business and its location will determine which marketing options best suit your needs, but with so much choice you have plenty of opportunity to experiment and see what works.
Getting Your Pricing Right
When you know your niche market, you can set more realistic prices that are not only more consistent with audience expectations, but also give you enough profit in the long term. If you’re not sure about how to price different products and services, check with trade associations, look in catalogs, and browse the Internet. But always remember to look at pricing from three perspectives:
- What does it cost you to manufacture or buy your product or service, including your overheads and profit?
- What is the customer willing to pay for your product or service?
- What do your competitors charge?
When you know these answers, you can make sure you are either more competitive in price, or your service is so much better that you can command a higher price. Also remember to think about the total costs of marketing, as this could ultimately affect your pricing. Ultimately, it’s up to you how you arrive at your pricing structure – just try not to price your goods and services too low, and regularly update your prices according to the market.
Taking It Further
In today’s highly competitive marketplace, being a niche provider is one of the most effective ways to build a profitable and enduring business. Specializing in the things that you can do better than anyone else is one of the quickest ways to find, attract, and retain your ideal customer.
When you’ve mastered the art of targeting your best customers, you can think about introducing new products or services to widen your scope. If you’re starting a new business, just remember that whatever marketing strategies you use, you will need time to see results. You can always modify your techniques to redefine your target market or expand it over time.
If you are interested to explore further on this topic you can always set up time to connect with us by clicking here http://www.businessfreedomgroup.com.au/10k-session/