Greetings again! Last week we talked about the four components of a target market. This week, we’re going down the rabbit hole a bit more!
Your goal is to define your target market as much as possible. The more you know about them, the easier it is to design a marketing campaign that will attract them, which we’ll talk about in Part III. But be warned: don’t try to fit all of your customers into one target market. Most businesses have two (or more!) target markets.
Take a realtor, for example. They have six different target markets: first-time buyers, home buyers, apartment buyers, vacation home buyers, commercial buyers, and sellers. While they all share some similarities, there are enough differences between them to treat them separately, especially for marketing purposes.
For example, first-time buyers tend to be much less sure of the buying process and need more handholding than other home buyers. They tend to be just married and/or just starting a family. They also are usually relatively new into their careers, so they are looking for less expensive homes. And… wait a minute. We’ve started to define the target market!
That’s the beauty of target markets—you likely already know what your business’s target markets are if you stop to think about it for a bit. But let’s go through an example of how you can clearly identify one.
TARGET MARKET CASE STUDY: FIRST-TIME HOME BUYERS
- Demographic: Usually ages 25-35, recently married, college educated, looking for a home in the $100,000 to $200,000 range (incomes in the $50,000 to $100,000 range), may have just started a family (1-2 kids), likely still paying off loans from school.
- Geographic: Looking to move within 50 miles of the realtor office.
- Psychographic: Scared or nervous about the home buying process, but also excited about owning their own home. Usually moving from an apartment, so they may not be aware of all the maintenance requirements a house will need. Often thinking about school systems and feeling of the neighborhood. Use the internet a lot to help with the home purchasing decision.
- Use-based: They will on average interact with the realtors 10 or more times but make only one purchase, which will likely last them for multiple years.
The more specific you can get, the better. Be careful of identifying too many target markets, though! Your goal is to keep the number manageable, so if you find yourself dealing with 10 or more target markets, see which ones you can combine together. We’ll see why in next week’s post.
Until then, happy pondering! And if you need help, I happen to have a twin sister who’s great at identifying target markets…
Author Bio: ”Dave Tomczyk, is an Assistant Professor of Entrepreneurship and Strategy at Quinnipiac University. His background is pretty diverse, including video game development, working at NASA, a Masters in Economics, and some work in astronomy. And a love of target markets!”
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