How can you tell what products or services are a great customer fit? It’s a vital question you can easily answer by knowing how to determine your market segment, so you can get them to buy the appropriate service at the appropriate moment and at the right place.
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What is a market for which you are targeting?
Before you determine the market you want to target It is important to be aware of what a targeted market actually is. It’s defined as being a segment of people who would be the ideal fit for your service or product. Also your market of choice is the population who are most likely purchase from your company.
Marketing your product to all people is time-consuming and expensive, particularly in the event that there’s no guarantee that it’ll succeed. However, what one can accomplish is to establish your target market by narrowing into a certain group of people who share similar traits. Picking a particular target market lets you target your offerings or services towards those who will likely buy from you, thus guiding your business down a profitable route.
Target market vs. target audience
Are you confused about the distinction between a target market and a the target audience? Don’t worry, you’re not the only one. It’s not uncommon for the two terms to be interchangeably used however, they have distinct definitions. The target market as well as the audience have a similar meaning. They’re both groups of individuals that share similar features. However, your intended market is a wider segment of people, or consumers but your audience is a small portion of the target market.
The term “target audience” is often used to define those who are the target audience for ads as well as marketing efforts. For instance, when you run an advertising campaign, it is crucial to select the right audience that are likely to see your advertisement. The audience you choose to target is essential to running a successful campaign.
Do you want to know how your advertising creative will fare against your intended market? Make use of SurveyMonkey Ad Creative Analysis to determine the effectiveness of your advertisements prior to putting them out on the market.
Step-by-step guide to identifying your market
Once you know the definition of a target market and what it is, you can follow the necessary steps to define your market. Let’s take a hypothetical scenario to simplify the process. Let’s say your company sells shoes which are ideal for running on trails. Who are the most likely buyers of these shoes? What can you do to ensure that you are able to reach them? Let’s discover:
1. Review your service or product and your current customers
Begin by conducting a target marketing analysis. This involves looking at your service or product while looking at your clients. This will help you know your customers’ preferences and requirements. In addition, it can help you determine how you can market your products specifically at those who will actually buy. In the case of a shoe store first, you must answer these questions:
- What are the features these running shoes come with? Are they specifically designed for trail running, with treaded soles? Do they have shoelaces that are specifically designed for trail running? Are they water-proof?
- What are the advantages to running on these trails in your shoes?
- Which are current clients who wear these shoes?
- What are the characteristics and traits these customers share?
We gather the information we have about our shoe company, and then looking at findings from the market research study We can fill in a few of those empty spaces.
Here’s a different scenario of what we’ve learned concerning our sneakers:
- They have soles for trail running and inserts, as well as being waterproof.
- Threaded soles offer optimal grip and strong laces that are specific to trail running.
- The shoe insert is comfortable during long runs.
- The waterproof features allow for comfortable runs even while running in the rain, and then running through puddles
We’ve uncovered some interesting facts about our clients:
- Ages 30-45
- Average 15 miles each week.
- Take long hikes, but generally don’t like exercising or walking in wet conditions.
- In physical stores, purchase shoes instead of shopping online
2. Conduct a competitor analysis
Increase your visibility in the market by understanding who you’re competing against using an analysis of your competitors. Knowing who your competition is can aid you in identifying any potential gaps in your target marketing. In addition, you’ll gain knowledge about trends, pricing forecasting, and ways to enhance customer targeting.
In particular, a competitor analysis can help identify:
- Who are your current competitions?
- Your competitors’ customers are at
- What are your competitors’ products or services are?
- Highlights that stand out, both yours and those of your competitors
Let’s take our sneaker as an example to illustrate:
Through conducting online research and sending out market surveys of research, we discovered that we have two major competitors selling similar footwear. One competitor is targeting their customers and is making use of language on their website (including images) which aims to target customers who are in the 50+ and above. Another competitor targets people who are younger than 30.
We also are aware that both rivals offer trail and hiking footwear that incorporate waterproof materials. Competitor A claims to utilize the most recent, modern technology that provides maximum comfort while running for long distances. Competitor B is more focused on style and has new modern designs, with a variety of bright colors and shoelaces.
The data we have gathered helps us determine that we may get an edge in the market by focusing on consumers between 30 to 50 years old. In addition, our marketing needs to concentrate on sole and comfort for those who prefer running for long or short distances.
We also realize that waterproofing isn’t an essential important factor for this population. So, we don’t need to encourage running in rain as part of our marketing plan. We could also inform the customers that we provide the opportunity to consult with us about their shoes prior to entering the store.
Once we have a better understanding of our competitors, we have completed our research on competitive analysis and are now able to move to the next stage.
3. Market research that is complete
The final step is to complete an actual research. This includes the segmentation of your customers to begin creating specific buyer personas by analyzing their problems requirements, wants, and overall traits.
Take a look at our target marketing analysis questionnaire template that will help identify your market segment as well as complete your study.
What is the definition of market segmentation?
Market segmentation consists of categorizing current and potential customers into different types of segmentation that share a commonality.
Types of segments and examples of each segment are:
- Demographic segmentation: gender, age, income, education, etc.
- Psychographic segmentation: issues, values, hobbies and more.
- Geographic Segmentation: country, city population, area, etc.
- Behavioral segmentation: buyer intent, life cycle stage, usage, purchase, etc.
Did you remember our shoe illustration? When we combine competitive research with our analysis of the product we can determine that our clients can be classified into the following categories in our running trail shoes:
- Demographic segments: We find that our clients typically females between the ages of 30 and 45 with a median annual income between $75 and 100K. They also have children and university education.
- Psychographic segments: People are worried with spending too much for something that won’t last. They also enjoy being outdoors, appreciate the natural surroundings, and spend lots of time with families and friends.
- Geographic segmentation: The reside within their own region of the United States, generally on the west coast, in cities like Portland, San Francisco, and San Diego.
- Behavioral segmentation: Our clients are likely to purchase our shoes in the next month. They are in the lifecycle of evaluation and usually make purchases of sneakers or other shoes at a retail store to ensure that the shoes are suitable.
Once we’ve completed all our findings and have a better understanding of each of the segments, we can start our marketing analysis of our running shoe for trails.
Benefits of analyzing target markets
The target market analysis will determine how your product can be placed in the market. It is a crucial element for understanding what your customers want.
Markets in the industry are always changing in response to consumer demands. With a target market analysis, you will have the ability to keep ahead of these developments as well as the competitors.
To be able to perform a precise the analysis of your target market, an impartial audience and a careful analysis are crucial. Through conducting a survey and analyzing the results with a keen eyes, you’ll be able to observe the way customers behave and what’s essential to them. In the end, this will lead to a plan for marketing that will explain the way your product or service are positioned in the market.
If you conduct a the target market analysis then you’ll benefit from the following advantages:
- Identify important markets
- Find your ideal customer and personas of your buyers
- Untapped opportunities to discover
- Examine the feasibility of a new product
- Develop a more precise business plan
Let’s go back to our shoe example:
Our shoe company would benefit from a market analysis of the target market in order to determine the most suitable site for our future stores, the best price for the shoes and also design ads that will catch the customer’s attention.
Based on our studies, we can conclude that targeting or locating shops within Portland, San Francisco, and San Diego would help draw our customers since they reside in these regions and would prefer purchasing from a shop. Based on our analysis of competitive factors as well as our consumers’ income that a cost between $75 and $100 is the price our customers will spend.
But, a deeper analysis could be made using an analysis of the market which can help narrow the price point, and also how and where to position our ads.
Market survey of target markets
The process of creating and launching a targeted market survey is a fast and simple way of getting familiar with your target market. It is possible to gather additional information about your potential target market which will allow you to determine your strategy.
A survey that asks appropriate questions, in the proper order can make a huge difference in conducting an accurate analysis of the market. Start your market research with the following questions:
- Ask questions to the consumer about their behavior Begin your survey by asking consumer behavior questions that inquire about their behavior, personality as well as brand awareness and their loyalty. These questions can be tailored to your brand or could be general. In the case of our shoe business we can ask questions like “How often do you run?” Another one could be “Are you familiar with these brands? …”
- Utilize disqualifying questions as the first question on consumer behavior to filter out those who might not be a good fit for your criteria. For example, if you are asking “How often do you run?” If the person who answers states “Never,” then it may be beneficial to stop the survey in that exact moment.
- Be simple and ask the most basic questions, such as age, place of residence, etc. These answers will assist you in creating the persona of your dreams.
We now know how to conduct a targeted market survey, we are able to utilize the data from the target market to create a marketing plan to sell our running trail shoes.
How can you use targeted marketing to your advantage?
After you’ve identified your ideal market, you’ll be able to create marketing campaigns specifically for that category. Through combining the information you’ve learned from the segmentation process and how you can stand out from the crowd your marketing strategies can be honed to attract interest of target customers.
In sum, for our running trail footwear we are aware of our target customer base is:
- It is headquartered is located in Portland, San Francisco, and San Diego
- I would prefer to make an in-store purchase
- You can purchase a high-quality shoe in the range of $75 and $110
- Choose shoes that are of high quality
- The longevity of a product is crucial to these customers, and an item or shoe that is waterproof is not.
- Enjoys spending time outdoor and spends time with the family
- Averaging 15 miles a week
We now know which market our products are targeted at and what we need to do, we can begin tailoring our offerings to those customers, and be ahead of the pack!
The benefits of targeting marketing
In addition to the advantages of target advertising, you can also reap numerous benefits and takeaways. Two of the benefits are getting ahead of your competition and building the trust of customers.
Beating the competition
Because a significant part of your research into your target market is analyzing your competition, you could make use of a variety of ways to promote your product that your competitors aren’t tapping into because their products or services don’t include the features that your business could offer.
Customer loyalty
The more you get to know your clients the more likely they’ll be inclined to want to know them. The result of a certain customer base is akin to the feeling of a friend. Through addressing the specific needs of customers they will be more likely to remain loyal to your company and your products. They’ll likely feel that they are part of your company and will be more likely to recommend your business to others to you as well.
Marketing examples for target markets
Here are a few examples of targeted marketing and the way it can be effectively used:
Running shoe company
Our shoe business is an excellent example of how the concept of target marketing was effectively used. Through conducting market research, distributing appropriate surveys to potential customers and studying their competition, this business can determine precisely what their customers are looking for. Furthermore, the business will be able to examine ways to stand out from their competitors and apply that to their strategy for messaging to attract the customers they are targeting to their shops.
Digital marketing agency
SurveyMonkey client, Elevate My Brand, is an award-winning woman-led digital marketing firm that does market research on a daily basis. They usually have to design the brand of a client from beginning to the end. This involves analyzing the market’s target. Elevate My Brand goes directly to their customer’s potential base, and gathers feedback that will eventually lead to new, specific campaigns. After the analysis is completed the agency works with their clients on the design of the questionnaires and the outcomes. They can create an analysis and develop an effective brand strategy based on the data that was completed.
Gluten-free food company
This is a rare instance in which the products the company offers are appropriate to a small group of people. When a company offers products or services to a niche audience–like people that are gluten-intolerant–then they need to have a good understanding of their target markets. The strategy of targeting marketing could include selling gluten-free items in specialty stores, offering various promotions, or even advertising the ingredients on packaging different from other food items.
Identifying your market’s needs is essential to figure out the ways in which your service or product can be beneficial to your customers, and more important, whether they’ll purchase your product. Knowing more about your targeted market involves analysis of your product, customer and competitors while doing market segmentation. This will assist your company in catering to the needs of your customers. Not to mention creating loyalty and achieve growth.