Understanding the Target Market: The Key to Successful Marketing and Why It Holds Paramount Importance in Business Strategy

 

Let's say you decide to start a startup. And you even have everything for this: excellent ideas, a budget, a selected team, and unlimited enthusiasm. You get to work and develop a cool product/service in your opinion. But time passes, and your product does not bring money.

What is wrong? But the fact is that you came up with a product, but did not find out who might need it.

 

Common problem

Unfortunately, most startup founders think that if they develop a "cool" product, people will come along and become users or customers.

When the founders had an idea, they saw a problem that their product could solve, but the target market was not in demand to solve this problem. According to statistics, 42% of startups fail due to a lack of market demand. In parallel, this can be the cause of a problem with the budget, which is rapidly running out due to a lack of buyers, which is also the cause of the collapse in 19% of cases.

It is also worth considering that without a preliminary analysis and search for your target market, there is no small chance of failure due to competitors. Perhaps someone already satisfies the need and does it well, so it will be more difficult for you to occupy this niche.

 

Why is it important to define your target market?

In an ideal world, one would first identify potential customers and the target market, understand their problems, study the market size and opportunities, and find a potential solution.

Then the time will come to develop this very solution in the form of a product or service.

In our world, most startups do the opposite. The decision first, target market after.

 

Why find a target market at all?

By focusing on one group of customers, you can better develop your product and message. You will receive instant feedback and better understand their real needs.

And when the client was able to solve his problem with your help, he will return to you and become an active user. This will increase your retention rate in the long run, and therefore make your business more scalable and profitable.

 

If this is not done, and trying to attract customers from everywhere, this will lead to many problems:

• Lack of quality feedback. Disinterested customers have no motivation to be sincere and try to help you make a quality product.

• No clear marketing strategy. You will be trying to reach different audiences, through different content through different channels, to find the target audience. As a result, your marketing work will be dispersed and blurred.

• Low retention rate. Difficulties in attracting the “ideal” client from the right audience lead to one-time visits. Clients are not returning.

• High cost of customer acquisition. A client who is not interested in a product/service is more difficult to interest and sell something.

 

How to identify the target market

 

If you want to evaluate your progress in identifying your target market, you need to keep a written record of your search efforts. You need to constantly work on this task to find the perfect audience for your product or service.

You can find or create your system to better document your guesses and findings in the target audience search area.

 

One of the who/what/when/where/why systems:

 

1. Who?

You ask this question to determine the intersection points of the target audience with your product/service.

If knowing this information will not affect your product, then this metric can be excluded from your documentation.

 

What can be learned by answering the question "Who?"

• Age group
• Floor
• Location
• Family status
• The level of education
• Profession
• Income level

 

Where applicable:
• Web analytics, social networks, and advertising tools
• Polls and interviews
• Academic and business studies

 

2. What?

Perhaps the most important question to ask is because not knowing the answer to it, you can fail.

 

What can be learned by answering the question "What?"
• What motivates a customer to make a purchase
• What problem can our product solve?
• What difficulties do your clients have
• What goals might influence the purchase of your product

 

Where applicable:
• Social networks
• Forums
• Meetings (online and offline)
• Polls and interviews
• Academic and business studies

 

3. When?

If your product/service purchase is seasonal, you can improve your marketing strategy by asking yourself the right questions about your target audience.

 

What can be learned by answering the question "When?"
• When should you try to connect with your client? (time of day/day of the week)
• When do clients encounter a problem? (day / month / season)
• When do customers make a purchasing decision? (day / month / season)

 

Where applicable:
• Trends and SEO tools
• Web analytics, social networks, and advertising tools
• Forums and platforms of the type "Question-Answer"
• Polls and interviews

 

4. Where?

Now the first "place" where potential customers will look for solutions e, the Internet has become.

 

People look for information in search engines, social networks, forums, and instant messengers, and make purchases in online stores. Find channels where your target audience spends most of their time.

 

What can be learned by answering the question "Where?"

• Where do your potential customers find out about new products and services? (social networks/search engines)

• Where do they look for solutions to their specific problems? (forums / search engines)

• Where do they seek recommendations from friends, professionals, and influencers? (Who are the clients following?)

 

Where applicable:
• Forums
• Polls and interviews
• Academic and business studies

 

5. Why?

This question will help you better understand the reasons why buyers make a purchase decision – and therefore, it will allow you to make more profitable and scalable business decisions.

If you get the “Why?” question wrong, it could end up costing you a lot of money going back and changing your product, service, or marketing strategy in the future.

What can be learned by answering the question "Why?"
• Why are your target market's problems still unresolved?
• Why haven't competitors come up with a solution yet?
• Why will customers choose your product over your competitors?
• Why will they pay for your product or service?

 

Where applicable:
• Polls and interviews
• Analysis of competitors
• Social networks
• Forums and platforms by type

 

Outcome

Your task is to determine who your target customers will be so that you can create a more suitable product or service according to their needs.

Just remember that the target market is changing. Your customers and their needs are changing. Your competitors and their ability to meet demand are changing.

And most importantly, as you learn something new in the process of work, your goals and your business will change.