According to HubSpot, 54% of the population is brand loyal. You need only to look at the “cult” followings of competitors like Apple and Android, Delta and Southwest, Starbucks and Dunkin’, and Microsoft and Google to see this statistic in action.
These companies understand that knowing your audience inside and out is the key to delivering the targeted marketing strategies that build brand loyalty. They put in the time and effort to identify their target market(s) and deliver targeted messages to them over and over. And you should, too.
What is a Target Market?
You might be asking, “Why should I limit my audience – can’t anyone buy from me?”
Theoretically, yes. Practically, no.
Many people need a car, but not everyone needs a BMW. Therefore, BMW’s target market consists of a subset of drivers with the means and desire to own a luxury vehicle.
A well-defined market optimizes your time, money and resources by allocating them to people most likely to buy your product or service. It shapes your messaging and marketing strategy, shrinks your competition and reduces your customer acquisition costs. Not defining your target market can result in making your business or product a “jack of all trades” and possibly alienates your most likely customer because you are not catering to them.
Steps to Defining Your Target Market
Analyze your product or service
What are the features and benefits of your product or service? Why do your customers need it? What problems does it solve? How much does it cost? What differentiates it from competitors?
First, don’t assume you are your ideal customer. You love what you offer. It’s your baby so to speak. So you’re not a fair critic. Second, differentiate between features and benefits. Features are what your product or service does. The benefits make your customer’s life better.
Examining your offering through the lens of a customer will help you distinguish who needs it, who wants it, and who is most likely to purchase it.
Profile existing customers
They embody the traits of your target market. Find out what they have in common, including their demographics, psychographics, interests, preferences and buying habits. In addition, is there a place where your target market gathers or publications/media that they read (trade associations, conferences, magazines, blogs, etc)?
Keep in mind that the person using what you sell is not always the person buying it, especially in the B2B space, so you may need to segment your market.
The more you understand the person making purchasing decisions and the end user, the more tailored you can make your messages and strategic approach.
Evaluate your competition
What do they sell? Who are their customers? Look at their website, social channels and marketing campaigns to see what they offer and how it compares to your business and to get a sense of who they’re trying to reach. This will also tell you who they’re overlooking. You may have an opportunity to tap into an underserved group or build a niche market.
Reevaluate your position
Once you identify your target market, be prepared for it to change as your business evolves. To stay ahead, periodically review these steps to find opportunities to refine or redefine your target market, brand position or messaging strategy.
Defining your target market often involves deep analysis and research that can be complex depending on your business sector. Gray Reed Advisory Services is here to help: contact me at mblachly@grayreedadvisory.com.