There’s a strange thing about the phrase target market that is arguably responsible for more business failures than any other cause: focusing on the “market” part, and ignoring the “target” part.
That is, many businesses tend focus on WHERE they’re selling their products and services (online, offline, geographic markets, channel partners, etc.), and not on what truly matters when it comes to success and sustainability: WHO they need to reach. After all, markets don’t buy things. People do.
With this in mind – and regardless of whether you’re a new startup or have been in business for many years – here are 4 questions to help you identify (or re-identify) your target market, so you can ensure that you’re not leaving revenues and profits on the table:
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What problems do you solve?
Objectively analyze your products and services, and create a prioritized list of the problems they solve. Using information and insight from your current customer base will help here.
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Who will pay for you to solve their problems?
Your prospective customers must pass four tests in order to be included in your target market: a) they must know that they have a problem; b) they must be willing to pay to solve it; c) they must be willing to consider you as a potential solution provider; d) they must be willing to pay enough for you to generate a profit (if not immediately then over time and according to your strategic plan).
Simply put: customers that pass all four tests are part of your target market. Those that fail even one of them are NOT, regardless of how much you may want to serve them.
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What are your competitors doing?
As advised by Inc., it’s always a good idea to conduct a rigorous analysis to see what the competition is up to. And the operative word here is “rigorous.” Don’t settle for just a SWOT analysis or superficial scan. Dive deep and go behind the scenes. Your goal here isn’t just to see what’s working and what isn’t, but also to identify opportunities to capture market share.
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What are your distribution channel options?
Do you deliver your solution virtually through email or the web? Is it a tangible good that needs to be shipped? Is it viable and sensible to have channel partners, franchisees or affiliates? These are just some of the distribution channel-related questions you want to answer, so that you can have a clearer sense of who can or should be included in your target market – and who cannot be or shouldn’t be.
Putting it All Together
Once you have all of the pieces laid out per the above, you can put the puzzle together and clearly see the psychographic, demographic and geographic characteristics of your target market. Of course, you’ll need to tweak and refine this profile as go. But you’ll have a solid foundation to work with, and won’t make the often fatal mistake of over-focusing on WHERE you want to sell your solutions, and ignoring WHO you need to sell them to.
Learn More
To learn more about identifying your optimal target market, contact Leap Clixx today. Your consultation with us is free.
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Topics: Inbound Marketing, Lead Generation
