One of the most important things everyone needs to know in business which target market they are in. A niche or target market is a clearly defined sub-aspect of the industry or sector you are playing in. For example, consider a company that produces beauty products. Defining a niche market would involve finding a particular demographic you can focus on as you begin to scale and expand your company.
Today, it is almost impossible to cater to everyone, and if you are a small business, one of the best ways to get one over on the much larger competition is by defining your niche market.
Most businesses do not have a clearly spelled out target market, so they end up targeting just about anyone who signifies any interest in their products or services. On the other hand, other businesses may instead attempt to target a larger audience which can prove to be almost as disastrous as not having any targets at all.
A major misconception amongst those who choose to work without a target market is that having a target market restricts your product from those who do not fall into your niche; this is wrong. Having a defined niche allows you to employ a scale of preference when preparing your marketing strategy or brand message. It also allows you to run a more efficient, affordable, and effective marketing campaign that will allow you to reach more clients that are more likely to patronize your business.
Consider, for example, a company within the CBD industry. They could decide to tailor their marketing efforts to individuals suffering from any type of body pain. However, if they wanted to define the market even further and increase their chances of conversion, they could then decide to classify users based on age or occupation.
When working within a niche, it becomes a lot easier to choose how and where you want to market your company. This article contains tips to help you identify your target market and niche, so you can better scale and allocate your marketing efforts:
Study Your Current Customer Base
It’s essential that you look at your current customer base and ask yourself the following questions: who are they, what are they buying (if you offer multiple products or services) and why do they buy it from you? Attempt to identify similar interests and characteristics as you try to create a more specified user group. Now among your groups, identify the ones that bring in the most business and try to look for similar users to them.
Study the Competition
Who are you competing against? Who are they targeting? Who are their current customers? If possible, try not to go into direct competition with them and instead, discover an aspect of the business they seem to be overlooking and play within that space.
Study Your Product
Whether you are offering a physical product or software online, try to take apart your offering piece by piece, choosing to write out a comprehensive list of every feature it has. Alongside every feature, itemize the benefits it offers your users. An example of a benefit is by helping you gain new users when they come across your product or service.
As soon as you have completed this list, create a list of people who have a need that could be met by your product. Consider our CBD company, for example, people suffering from osteoarthritis would be an ideal target market.
Review Potential Target Demographics
It’s important not only to figure out who needs your service or product but also locate those who are most likely to buy it. When trying to put together a list, consider the following factors:
- Income level
- Education level
- Marital or family status
- Ethnic background
Consider the Psychographics of Your Target
Psychographics refer to the much more personal characteristics of an individual. Some of these include:
Once you can identify how your product or service will improve the life of your target market, the next questions to ask are how frequently and when will the target use the product? Identify the most appealing features your target audience would like and build your marketing strategy with those needs in mind.
Try to determine the following: where does your target audience turn when they need information or answers to a specific question? Does your target audience read papers, or watch the news and other television shows? Do they frequent social media sites or use other digitally based applications on a regular basis as millennials do?
Review Your Decisions
As soon as you have gone through this process and have decided on who your target market should be, you will then need to review your decision to ensure you did not miss out on anything. Here are some more questions you should answer:
- Are there enough people in my niche to make my business successful?
- Will members of my niche gain value from my product/service? Do they need it?
- Am I aware of the steps my niche goes through before making a decision
- Can my niche afford what I am selling?
Your niche should also not be too broken down. It is important to remember that you can have more than one niche market and if this happens to you, you should consider splitting your marketing messages to cater to each niche. Optimally, you should not be able to reach multiple niches effectively with the same message. If this happens to you, then you may need to recapture your niche and rethink your strategy to appeal to a larger group of consumers.
In case you don’t know where to start or how to procure the necessary information to do this research, you can start by searching online for research other people have done. Look for blogs or articles that capture what you are looking for and continuously look for forums where people discuss your target market.
Finally, and most importantly, speak to your customers. Carry out surveys as often as possible to discover answers to these questions. And although this may seem like a lot of hard work, once you have successfully defined your target market, reaching them will prove to be much easier and a more straightforward process.