The target market is one of the most important things that all business owners must understand, be it offline business or online business. To determine the right marketing strategy to grow the business, then you must know the target market of your business first.
We'll help you to understand more about what your target market is, how to define it, and anything else related to the topic.
What is a target market?
The target market is a group of consumers or customers who are targeted by businesses to approach. The goal is for that the consumer group to buy the product or service you offer. A reliable businessman will group his target market based on traits, age ranges, or characters and habits that are considered aligned or relevant.
In determining the target market, business owners must group people with specific segments. Through this segmentation activity, business owners can obtain data and process it to determine which market segments or consumers are considered most in accordance with the characteristics of the business carried out. The target market is a basic thing that must be known by business owners.
The target market cannot be selected or determined without doing what is called market segmentation. Market segmentation is the activity of dividing heterogeneous groups of prospective buyers into smaller homogeneous groups.
All business owners must segment the market first before they can determine an accurate and appropriate target market for the business.
In general, the target market can be interpreted as a group of consumers who have been divided according to their respective segments targeted by business owners in order to buy the products or services offered.
Benefits of Knowing the Target Market
The target market aims to ensure that the marketing strategy you do can be precise. It is important to increase sales while measuring the success rate of the marketing strategy you are using.
Here are some benefits if you can figure out your target market:
1. Increase Sales
Knowing the target market can allow you to create products faster so that you can market them first than your competitors. As a result, your sales of the product will increase.
You will also find it easier to develop your product. All the data you have from your target market will help in determining which products customers like and which products are less popular.
Not only that, your ability to meet customer needs well will encourage customer loyalty. Please note, 65% of the company's profits come from loyal customers.
If this is applied to every product, it will certainly give better results.
2. Know the Budget Needed Better
The marketing strategy you do will cost you. If you don't define your target market strategy beforehand, you'll most likely market your product to everyone. This means that the budget you spend will be very much, and it is not good for business finances.
Although you may end up selling a large number of products, the profits you get will be relatively small because the marketing costs incurred are many.
By knowing the target market then you can devise a marketing strategy more precisely.
3. Anticipating Your Business Competitors
If your business has competitors, don't worry too much. Your ability to anticipate competition by knowing your target market will give you an advantage.
The key is to know your target market preferences and see what competitors have to offer in that market. Then create a product with features or advantages that can not be offered by your competitors.
Knowing your target market can help you stand out more than your competitors. That's what big companies like Apple and Nike are doing with their products.
4. Make it easier to Prepare Promotional Content
Your target market will determine whether promotion or marketing will be done through print media such as newspapers and magazines or marketing through social media only.
The success of a marketing strategy is influenced by the promotional content used. The more relevant the content used with the target market, the more successful this strategy is in attracting customers. The potential sales of the product can be boosted to the maximum.
5. Build Communication with Customers
By knowing your target market, it will be easier for you to communicate with your customers. The purpose of such communication is to understand the needs of the customer.
The communication you do can be through surveys, polls, or other means. Because you already know the target market you want to reach, you know who you deserve to participate in the activity. The information obtained will also be very important to determine the new product you will create.
Surely the products that customers need will be easier to sell, right?
6. Opening Investment for Micro, Small and Medium Enterprises (MSME)
Investing is one of the most effective ways to grow a business, especially for small and medium-sized businesses.
If you want others to invest in your business, show that it is well planned. One way is to show a clear vision and mission and understand the target market you want to reach.
Investors will be more confident to work together to grow your business.
How to Determine the Target Market
Given the importance of knowing the target market for your business, learning how to determine the right target market for your business is the right thing to do.
Then how do I do it? Let's learn the steps to determine the target market exactly one by one:
1. Start With Assumptions
If you already have a product you want to market, you can look at the statistics of your current customers, then create a list of target markets that you think are potential for those products.
For example, your product is a young fashion product such as shoes that have an attractive and contemporary design and are priced at an affordable price. This product is also easy to buy through various online stores or other marketplaces, apart from your own online store.
So, you can assume that your target market of products is teenagers who tend to want to look different from shoes that have a unique design. They are also active smartphone users and love to shop online. The target market of your product is those who buy the product by comparing prices.
On the other hand, if you have not or are new to making a product, then you can try to make assumptions about your product and who the target market is by using the above methods.
2. Observing Market Competition
Since every product must have competitors, you must be smart to research or observe the competition in that market. This will make it easier for you to find a gap to attract customers to buy your product compared to your competitor's product.
Product excellence can be in terms of features, price, and ease of purchase. By learning how the market responds to your product and how your competitors offer similar products, you can create or develop your best product.
You can also see what makes consumers buy your products compared to your competitors' products.
3. Communicate with Your Customers
To convince customers to buy the products or services you sell, you must be able to meet your customers directly. By communicating to customers, you will know their needs and how your product impacts them.
For example, you have a travel business. You may find the fact that your customers not only want to go and be in the vehicle, but also want to travel. With this information, you can be creative in creating travel package products with additional interesting tours.
Many tourist sites that can be visited when traveling, so there will be many package options as well. Do some research on which places your customers would prefer to visit by communicating with them. There will likely be many customers as well who want a travel package.
This also applies to proving that the assumptions you have made before about your target market are correct or not.
4. Take Advantage of Analysis Tools
You can take advantage of technological advances to get the expected results or even better. By using data processing tools or analytics tools, you can find out your target market.
For example, you can use Google Trends to find out what people are currently searching for on Google. When you enter the keyword “Digital Marketing Agency”, it is likely that you will find results related to that search.
However, the usefulness of the tool depends on the user. If you use it properly, then you can get useful information too. Therefore, enter keywords that are appropriate and relevant to your business to get useful information.
5. Creating a Buyer Persona
A buyer persona is a representation of your customer. That is, you describe potential buyers based on physical characteristics, demographics, and other factors.
To build a buyer persona, you can start by determining your gender, age, lifestyle, and more. With specific data, your target market will be more unique.
You can get data for buyer personas from a variety of analysis tools. If you have a website, Google Analytics is a great tool. This tool is able to record information about your website visitors starting from the location, duration of accessing your website, even the profile of the visitor.
You can create more than one buyer persona, depending on your business type.
6. Explain the Advantages of Your Product
After you determine the buyer persona of your prospective customers as well as your competitors, the next step is to show the advantages of your product.
If your business offers products that highlight features, then you should focus on explaining the sophistication of the features of the product.
For example, Apple calls all the products they own as premium products. This makes the price factor no longer a major consideration because the features presented are equivalent to the price.
7. Creating Brand Positioning
Brand positioning aims to create a perception of a product for customers. The role of brand positioning is very important to sell a product. According to data, 91% of consumers tend to buy products from brands that are well known or have big names.
If you succeed in creating a brand positioning, your target market will form itself. In the future you just need to maintain your brand to get the maximum market potential.
Strategy for Determining the Target Market
Another thing that is no less important than the target market is the determination of strategy. There are at least four market targeting strategies that are commonly used by business owners:
1. Mass Marketing
Business owners use mass marketing strategies to target a large number of markets to sell their products. This strategy does not really apply segmentation in determining its customers. Because the products offered are general needs that are needed by everyone.
Examples of products that can be marketed with this strategy are soap, toothbrushes, and other toiletries.
In implementing this strategy, the focus of business owners is more directed at how to make more people aware of the products offered. So that the potential for consumers to come and buy these products will be higher.
2. Differentiated Marketing
Differentiated marketing is a strategy to target a more specific target market.
For example, if you previously sold regular soap products, now you can differentiate soap for men and women.
3. Niche Marketing
A smaller and more specific target market strategy is to use niche marketing.
An example of a product that can use this strategy is the sale of a special toothpaste for sensitive teeth. Despite the relatively smaller market size, niche marketing can be a means of market penetration.
This can also make business people as market leaders in the targeted niche as long as they apply the right strategy.
4. Micro Marketing
The last is the strategy of targeting a more specific target market, namely micro marketing.
This strategy is suitable to be applied to the products offered are limited by location, type of goods, or time.
What to Do After Knowing the Target Market?
After understanding about the target market, there are several things that business owners still need to do to make their products more in demand. One of them is to create or always innovate with new products. The goal is to make the product more attractive.
This process can be done by finding new types of products, changing packaging or prices, to offering an easy product delivery process. Business owners can also promote products to a predetermined target market in order to attract new consumers.
So what if sales do not increase even though they have targeted the intended market segment? One solution that can be chosen is retargeting, namely using different methods or promotional media, such as using other social media. The goal is to remind potential consumers about the advantages of the products offered.
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