by Richard Baker, Food Distribution Guy
Many new business owners resist the idea of defining a target market because they want to be able to “sell to everyone”. They feel that such a definition may restrict their audience, and they want their product or service to be available to the broadest market possible. Yet, they forget the number 1 commandment in marketing: “You can’t be all things to all people”. This is true in life, with the relationships we have with others, and just as it’s true in business. Those with a distinct target audience will flourish. Those who don’t are left asking the same question, Why?
Take myself for example. Prior to launching Food Distribution Guy, I ran GR Marketing Strategists. The G represented the first initial of my father’s name and the R represented the first initial of my name. That was the extent of my business’ success. If it had not been for my business coach, I would still be stuck in neutral trying to understand why my phone was not ringing. In working with her, we identified I was trying to be one to all and my message was not resonating with potential clients or contacts.
“In marketing, I’ve seen only one strategy that can’t miss – and that is to market to your best customers first, your best prospects second and the rest of the world last.” (Mr. John Romero – Designer, Programmer and Developer in the Video Game Industry)
So, what are the benefits associated with having an ideal target audience, what are 5 steps you can take to identify them, what is the difference between primary and secondary target audience, what is market segmentation and how best to segment your ideal customer?
The Benefits Associated with Having an Ideal Target Audience
There are 3 distinct benefits to those business’ that have a distinct target audience. They include:
- It is easier for business to connect with their customer: Honing in on a specific target makes your decision-making much easier and your marketing efforts to be more precise.
- It is easier for your customer to connect with your business: When you’ve defined your target market and are using the proper marketing strategies and channels, you will be in their space, either physical or virtual. They won’t have to search hard to find you because you’ll already be where they are.
- Easier for others to make referrals: When business contacts have a true understanding of your ideal client, equipped with this information, your contacts will provide you with stronger business leads.
The Five Steps to Identifying Your Ideal Target Audience
To maximize your sales efforts, you need to have a distinct understanding of your ideal customer. Outlined is a 5-step process to identifying your business’ distinct target audience:
- Understand the problems you solve. What are the problems that you solve and who is most likely to suffer from this problem?
- Paint a picture of the customer. Start to list all the different types of customers that suffer from the problems you solve. Group them by geographical location or market sector. Ask other relevant questions about them, (i.e. gender, martial status). Create a general customer profile.
- Evaluate competitors’ customer. Who is your competition targeting? Are their significant differences in your offering that precludes this consumer?
- Who will gain from the value in your offer? Ask yourself: To whom will these problems be most troublesome?
- To whom will these problems be most troublesome?
- Who will have the most to lose by not dealing with these issues?
- Why should they buy my product?
5. Look internally at your company. One way of deciding on the right markets to pursue is to think about your company and your business. For instance:
- Do you have particular areas of strength?
- Do you have a unique knowledge of a specific geographical area?
Primary & Secondary Target Audiences
Primary Target Audience: A business’ primary target audience represents those most likely to buy your product or service. This market shares common characteristics and behaviors. They are most likely to purchase now.
Secondary Target Audience: A business’ secondary target audience represents the second most important consumer segment you’d like to target. It’s not your primary customer base, and they may have less money or fewer demands for your product.
What is Market Segmentation and How Best to Segment Your Ideal Target Audience?
Market segmentation is a sound marketing practice that enables a business to better target it products at the right customers. The goal is to separate the general market into categories, which can then be targeted and marketed to most effectively. For an ideal market segment, there are a number of key criteria it must contain to be ideal, and worthwhile to target:
- The segment must be measurable.
- The segment has to be large enough so that a profit can be earned.
- It needs to be stable and not vanish after a period of time (i.e. a fad or a trend).
- You need to be able to reach your potential customers through your marketing activities.
- Customers in the market segment must have a preference for similar product qualities.
There are four general types of market segmentation:
- Geographic segmentation: separates a market into different geographical boundaries.
- Demographic segmentation: separates a market by demographic indicators including gender, age, household type, education level and income.
- Psychographic segmentation: separates a market by lifestyle as well as values and beliefs.
- Behavioural segmentation: separates a market by shopping and buying behaviours. (i.e. Do they research a purchase carefully before making a decision, or do they tend to buy on impulse?)
Impact for Small Business
Business must be patient and must take their time when identifying their ideal target audience, as they will represent the life line of your business. Improperly identifying your ideal target sector will set your business back. Do not guess. Do not copy what your competitor is doing. Research is key. Your business success is a marathon, not a sprint.
This article is originally posted as a 5-part series by Richard Baker at www.fooddistributionguy.com. For more help Getting and Staying Listed in Canada’s Grocery Sector, connect with them through their website: www.fooddistributionguy.com or give them a call toll free: 1-844-206FOOD (3662).