Starting a Business – Researching Your Target Market
Recently we published a blog post about Start-up Business Basics. In that post one of the first points we discussed was Researching Your Target Market. Today we’re going to dig a little deeper into that point.
When starting a new business, it is important to not only identify a target market but to reach that target market where they spend time, both online and offline. Once you have identified who your customer will be, it is also important to understand the best methods to reach them, and to understand that not all marketing strategies work for all markets.
Identify Target Market
When starting a new business, a target market may be a specific geographic area, a particular demographic or something known as psycho-graphics. Psycho-graphics are the interest and hobbies that may have a need for the product or service a new business is offering, while geographic areas pertain to location and demographics refer to age, gender or income level. Once the target market has been identified, it is time to develop marketing plans to reach those target markets.
If someone is starting a new business that has a geographical target market, for example, a product or service that will be of particular interest to people who live or work in a certain area, there are particular ways to reach that target market. A convenience store near a sports field may realize that the target market is not the parents attending games at the field, as there is a concession stand at that time, but during practices when the concession stand is closed. Focusing advertising toward those parents, such as offering discounts or special promotions geared specifically toward busy parents may increase business in the store not only during practice, but during games as well. The key is to identify how the product or service offered can resolve a problem someone in that geographic location may have. Once that has been identified, advertising campaigns can be developed that explain to people in the region why the new business offers a product or service they need.
Demographic focus offers a broader range of methods to reach a target audience when starting a new business. Take a critical look at the products and services offered and identify the following demographics:
• What age group will most benefit from the product or service?
• Are the product or services geared more toward men, women or both?
• What is the average income level of the person who will be most interested?
• Is the product or service geared more toward a particular education level?
• Is there an ethnic or racial identity involved?
• Does the product or service benefit married, single or both?
• Is there a particular household size that could benefit?
• Is the product or service geared more toward a particular occupation or industry?
Once the demographic information is narrowed down, there are certain marketing tools that work best based on some of those demographics. For example, social media marketing has proven successful at reaching younger demographics, while email marketing works better with older demographics. Still others find mass mailings to be the preferred method to learn of products or services. Television and radio advertising are expensive, and although they still provide a significant benefit for marketing, research is finding that consumers are taping their favorite shows and fast-forwarding through commercials, while young people now connect iPods and cell phones to car radios to listen to commercial free music. Therefore, television and radio may reach a target market of those that are less technically savvy, such as older couples and retirees.
If after starting a business it is determined that a lifestyle focus is identified as a target market, there are other methods that work better to reach the customer. If the new business is a restaurant, one marketing plan could include partnering with a local theater group and offering dinner discounts during performances. This will target those that enjoy live performances who may also enjoy dinner out when they go to see the play. Writing guest articles in non-profit newsletters could attract the attention of target markets that include particular hobbies or interests. Research other businesses that may be willing to partner with a new business in a way that will benefit both companies.
Starting a new business is fun and exciting, but to insure success it is critical to not only identify the correct target market, but to create marketing plans that will reach that market. It is also important to remember that most businesses have more than one target market, so it may require a combination plan to be sure all target markets are reached.
At Blue Coast Savings Consultants we have done a lot of this work for you and we have the tools and proven marketing strategies to reach the ideal target market for our services. To learn more about our business opportunity please view our webinar and see if this business is right for you.