Understanding your ideal market could seem like one of many boxes to be checked off the “starting a business” list, yet it’s the most crucial aspect of the procedure.
The market you target is at the heart of everything you do in everything from the product that you develop to the marketing campaigns you create. You cannot sell to anyone and to everyone. By limiting the people you’re targeting, it will increase the number of sales because the messages you’re sending out are relevant to the target audience.
In order to set up your business that is successful, you need to determine who your primary market is. This means knowing not only who they are, but also how they behave, and what they are looking for or want. Then, you’ll be able to discover ways to communicate with them with regards to what is most important to them, while not ignoring others who might not see any value to the services you offer, and the reverse is true.
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What is a market for which you are targeting?
A targeted market is a segment of people who are who are most likely to purchase your product or service. These are the customers you need to be focusing on, the kind of customers who come back repeatedly, suggest your business to their acquaintances and praise your business through social media.
What is your ideal market
Many small-scale business owners design items they wish they could have. For instance, take the shoes from the brand Allbirds for instance. The company was founded after the founder of it, Tim Brown, struggled to find shoes that were made from Merino wool. Allbirds was founded to fill in the gaps and with Tim as the first client and the company’s primary market.
But, staying on your “I am my own customer” route for too long could be dangerous. Informing assumptions about the intended customers based on your personal feelings, thoughts and behavior can end the market research process for targeting. What customers will want may differ significantly from the product that you intend to develop.
You’ve decided to be anti-Facebook and removed your account as a protest at the privacy settings of Facebook. If your ideal customer is like yours then you’d want to eliminate Facebook advertising out of your marketing strategies. However, in reality you could be limiting your ability to connect with the smallest portion of your prospective customers that have the majority of things that are similar to yours.
You don’t represent your entire market your intended audience, your customer base.
There’s an excellent chance that you act in a different way than your prospective customers, and using your own behavior as a heuristic can cause a lot of harm.
The process of identifying multiple target markets isn’t a necessity when you’re just beginning however, it is helpful to establish a minimum viable market–the most you should be aware of your ideal customer prior to diving into. Hiya Health co-founder Darren Litt suggests looking for the answers to these questions:
- Who is most likely to benefit of your service or product?
- Who’s going touch this item?
- What are the reasons why they require their product or services?
- What is the difference this product makes when compared to other products?
- Here’s how to find the solutions.
Host focus groups
Beginning with your research on market and with no customer data? The fastest way to receive immediate feedback is by hosting the focus group. It is A group of 8 to 10 people who are honest in their feedback about your product that is soon to be launched.
- A lot of people depend on Sales to provide feedback.
- The truth is often not told when it comes to money.
Indicate that you’re seeking participants in a study. Provide incentives for people to take part, like an unpaid product or a an amount of $25. If you’re looking into the potential market for the launch of a new wine brand such as hosting an evening with wine and cheese at a local winery. More relaxed and enthused people are in the gathering the more likely they’ll be to be open and honest in their responses.
You can also hold the group online through web-based conferencing software like Zoom. This way, you are able to invite participants from across the globe without limit research to the opinions of individuals in a particular region.
When deciding on the people who will be part of this focus group make sure to be wide with your criteria, especially in the case of your first venture into the world of market research. Be aware that assumptions about the people who will purchase your product may cause you to take the wrong road. You can always narrow down your market once you’ve excluded certain groups that isn’t the target audience for your product.
In the course of the event, you should invite questions that are open-ended, such as:
- What characteristics do you look for in the brands you buy from?
- What will need to happen in your daily life for you to purchase this item?
- If you’re not sure about purchasing this item what would you purchase the item as a present?
Don’t be afraid of diving into the rabbit hole. Instead of a single-sided survey, you can truly draw on the feelings, thoughts and stories that people share when you’re talking face-to-face (or screens to screens). Pose open-ended questions and draw out interesting elements of their responses to further discuss.
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After completing these steps, you’ll need to assess your decision. Be sure your group has enough people who are there, that these customers would be benefited by your service or product and that they are able to afford it and that you’re in a position to communicate your message. This is the last step to identify your ideal customer.
Contact the current customers
“Your current customers are a great resource,” says Jean Gregoire, CEO of Lovebox. It’s true: current customers have given up their hard-earned money in exchange to purchase your products. In many cases, transferring the money’s route will lead directly to the market you want to target.
Jean offers advice “Figure out the reasons they’re purchasing from you. Are they interested in any of the same desires? Consider looking at your service or product thoroughly. What are the key attributes it possess? What are its strengths and advantages? When you know that it is possible to figure out which types of people are likely to be able to benefit from the product.”
Check the data you have within your back end of e-commerce. For example, customers may give their postal address to you to ship their goods. Put all that information into one spreadsheet to identify your most frequently visited locations.
You can also include a birth date field to your post-purchase account’s creation page. Offer your customers a voucher or gift for their birthdays, in exchange for information about their age to help you conduct market research on your targeted customers.
Gather more information on autopilot by including a customer survey to the purchase confirmation email. Make the questionnaire short and sweet to make it easier for new customers to provide their thoughts. Use a mix of psychographic and demographic questions such as:
- What is your educational level?
- How do you fill your time in leisure?
- Why did you decide to purchase our product?
- What was going on in your personal life during this period?
- What channels did you utilize to learn about this product?
Applications like POWR Customer Survey Zigpoll, POWR Customer Survey, and Fairing Post Purchase Surveys can help you with this If you’d like the purchase confirmation emails to be free of clutter.
In any case, you should look for commonalities in the responses you receive. Behaviors, thoughts and personality traits that you notice are what your customers who pay you common, and your market too.
If you take a close examination of how your company can benefit certain customers and help them, you’ll be able identify the people who are those customers.
Be aware of competitors
In a highly competitive market knowing your competition’s areas of focus can help find your niche, especially when the products you’re offering are similar to those sold by your competitors.
Brands of toothpaste are a good illustration. If you look at the formulas of the most popular toothpastes there’s hardly any differences. Retailers in this category have a distinct brand image that is targeted to a specific market.
Create a list of your the competitors in your niche. You can identify them through asking the following inquiry in your surveys: Did your think about other products prior to making the decision to buy ours? If so, what were they, and why did you decide to purchase from us?
It’s extremely unlikely that each of these rivals to freely divulge information about their audiences You can conduct some research by:
- Looking up the brand’s name on social media
- By looking at the influencers every brand collaborates with
Conducting research on customer reviews and case research
When I was marketing the products of my Shopify shop, Dead Sea Trading Co. I examined my largest rival and then I used Alexa.com to determine their market was females aged 35-65 with a salary of more than $100,000 annually. To target this audience, I created an online book club for women of the same age group. I also included advertisements on behalf of Dead Sea Trading Co. If it was appropriate. Its results are quite impressive and the amount of traffic to my store has grown threefold since the start of this book group.
Mitchell Stern, the the owner of Side Hustle Tips
Although competitive analysis can be an excellent starting point for your own market research but the aim is to distinguish yourself from the crowd. This is why Justin Chan, growth manager at JuneShine suggests that you use this data in order to “find a niche market which they are overlooking.”
Justin states, “It is useful to identify your niche since it provides you with an opportunity to stand out from the crowd. You can have an audience who is attracted to you for the product. At JuneShine, we’ve got an extremely specific niche in alcohol-based Kombucha. It is a blend of the desire to stay healthy while still being able to take pleasure in a delicious drink.”
Dive into existing research
Once you’ve a good knowledge of the kinds of people that are in your market, you can delve deeper into their thoughts, emotions and actions they exhibit by conducting research on the industry.
The following platforms have consumer behavior patterns that you can tap towards:
- McKinsey & Company
- Gartner
- Pew Research Center
McKinsey released the “State of Grocery in North America” report that proprietors of grocery stores could use to identify their market segments by focusing on shoppers for fresh vegetables and fruits.
“There are many tools to help you do a deep dive on your target audience, but keyword research can reveal more intimate and private pain points that customers or brands may not be open to talking about,” Marquis Matson, VP of Growth at Sozy says. “Mental health issues, relationship struggles, body image issues … these are all revealed in keyword research.”
If you’re aware that the primary market to purchase your health supplement are women who are going through menopausal changes such as, for instance, check out Google’s autocomplete box to look up related terms people are searching for:
However, remember that market research for target markets requires tangible data, not just the assumption of. This is the reason Marquis adds “To verify the subject matter I engage with Social Media and customer service teams in order to gain knowledge about what customers are discussing. The information I gather from what customers have to say and the way they’re saying it influences my approach to all content on the site.
“Once you have customers who buy your products You will have data about the types of people who are who are most likely to purchase your product. That will get you quite far in your market study.”
Through sales channels or platforms
The brands that sell on Ecommerce have distinct customers they target across their platforms and channels that they sell their products on. The seller of handmade products such as a handmade item, for instance, has different market segments for:
- Etsy profile
- Ecommerce Website
- Brick-and-mortar store
Customers who purchase from the brand’s online store will differ than those who shop at its Houston brick and mortar store. Location is the primary distinction: selling online lets you be able to reach potential customers throughout the globe. You can’t afford that in a physical shop (unless you’re located in the middle of a tourist area).
The platforms that you’re promoting your business on have different customers. Customers who come across products via Instagram are likely to follow one of the numerous influential people who use the platform to earn an income. The audience for Pinterest users could be more inclined to buy handmade items than mass-produced ones.
To determine your market for a specific platform or channel of sales Repeat the steps that we’ve described. Ask customers you have purchased or found your products via every. Develop Google Analytics segments for each reference source, then utilize the Ecommerce purchases report to determine the most popular items for customers from every source:
You can also go directly to the platform. A lot of social media platforms offer ways to poll your followers such as Instagram Story polls.
You can even organize giveaways where participants are awarded something like a product in exchange for information on your market’s potential on the channel. “Comment below why you’d like to win” is an easy conversation starter to engage your followers.
What is the size of my target market be?
Find out the size of your market by conducting some desk research. Use free resources, such as the ones below to determine how many people have the same characteristics as you’ve described.
The US Bureau of Labor Statistics is a fantastic source to study the number of jobs, income levels and the way people spend their spare time. Statista also gathers information on the number of people who buy or stream, watch or read about something.
You can also utilize Facebook’s audience builders to estimate the size of your audience according to the interests as well as genders and locations of your market. (Important note: Facebook’s audiences builder does not include data from its users, therefore it’s best to stay clear of this method if you’re looking for a segment of the population that has been who is not a user of Facebook.)
One common error marketers make when they define their market is to assume every person is client. You can try to contact any and all hoping that they’ll become a customer If you have your message correctly. However, the opposite is true in the real world.
If you’re not able to come up with an idea of the people you want to targetthe marketing you’re putting out will appear to be thin, thereby spending money on people who are not interested in what you’ll declare.
Ecommerce Entrepreneur Sam Barrante
Similar issues arise if you are too specific. You can certainly get a small number of customers with highly specific and customized marketing messages. But a market with 100,000 people, taking an typical conversion rate at 2.86 percent, is only 286 paying customers. If they’re purchasing $50 items and generating a revenue of $143,000. Repeat customers can push this number but it’s not enough to make a lifestyle company into a bigger one.
There isn’t a standard to decide how large your market to target should be. Certain industries are significantly larger than others. There are more consumers interested in shopping for groceries than are buyers interested in purchasing Star Wars costumes, for instance.
For a rough guideline suppose you’ll be able to achieve an typical market penetration of between 2% and 6%, the proportion of your audience who will purchase your product. Multiply the size of your market by the percentages above to get the highest level of revenue that you can earn.
How do you define and connect with your desired market
Marketing campaigns aren’t the way to go to reach out to your intended audience. This would be too general. Segmenting your market to find the target audience for each campaign is the way to make decisions based on your study. If you’re using Shopify for your business, then Shopify Segmentation allows you to gain valuable insights into your customers.
Also, break your desired market into smaller segments, forming targeted audiences, a subset of the target market that your marketing efforts are targeted to. These are buyer personas – fictional representations of one specific target segment of your market.
The Great Little Trading Company’s primary market as an example. Its ideal clients are parents of young children. Other factors, like the location of parents along with the age of the child and the income level of the child are all factors to consider. It’s a mistake to not consider parents of youngsters but do not meet the criteria for all three boxes. It’s still its primary market, but smaller a portion of it.
Common characteristics that are seen in the eyes of some customers however not in others, you should consider them as segments of your targeted market. Here are three methods to utilize this information to aid in digital marketing.
Demographic segmentation
Demographic segmentation of the market is the process of creating personas from people who share traits, for example:
- Age
- Religion
- Ethnicity
- Generations (e.g., Gen X, Gen Z, Millennials, etc.)
- Income level
- Marital status
- Education level
Calculate the proportions of the different demographic markets and plan your marketing budget according to this. If you are aware that half of your target market is between 40 and 65 years old as an example, then allocate the majority the budget to programs specifically targeted at those age groups.
A good example of segmenting is through paid advertisements A company can choose to limit ads targeted to a certain gender or an age group instead of serving ads to all ages and genders. It can also be utilized to create interests in which a company can choose to only serve ads to those who have shown an desire to be interested to one of distinct areas.
Additionally, make use of the demographics of each segment to tailor the marketing materials and products you’re marketing. You can make a guide to Christmas gifts with recommendations for products that fit the following segments of the market:
- Income level. Create a gift guide with items that are less than $20 for people with a low income.
- Family status. I recommend customized “World’s Best Dad” products for parents with children.
- Generation. Create an Instagram advertisement campaign that features influencer-endorsed products that are recommended to Gen Z target audiences.
If you want to see a concrete example of this take a look at Starbucks. Instead of tailoring its marketing efforts towards anyone who drink coffee, the company’s primary consumers are young professionals who are able to spend $5 on their every day cup of coffee. We can see this in its advertisements on television, Facebook advertising campaigns, and TikTok videos.
It is crucial for companies selling e-commerce to establish a target market to avoid in the process of wasting time or money on customers who are not competent to buy specific items. It generally costs money for customers to view an advertisement therefore businesses should ensure that they are only targeting the particular segment of people who are most likely to buy their products.
Michael Anderson, Ecommerce Specialist at SIGNAL+POWER
- Localization
- Geographic segmentation refers to the differences in the areas your market is located and includes:
- Climate
- Currency
- Languages spoken
- City, country or continent
A segmentation of your market’s the location of your customers can help you tailor your shopping experience. Studies show that 66% shoppers are looking for companies that they buy from to be able to comprehend their needs. This is why marketers who have their customers segmented and customize their email messages have a 760% rise in sales.
Let’s get it into action and look at four different ways to make use of localization:
- Configure Spanish translations in the Shopify store if you have a large section of your customers speaks Spanish fluently.
- Create Facebook ads for the popular part of the city, and use local landmarks to reference the.
- Make an Instagram shop that has prices in CAD to suit your Canadian market.
- Provide raincoats and umbrellas to your ideal customers in London.
- Flow Hydration personalizes its ecommerce website by directing a portion of its customers to microsites that have a specific location.
Psychographic segmentation
Psychographic segmentation is the process of splitting your market into smaller segments by the characteristics that they have in common, for example:
- Values
- Interests
- Opinions
- The way you shop
Utilize this segmentation technique to modify the message you’re giving every. At its heart, great copywriting is personalized to the audience you’re targeting. Consider each segment’s views of values, beliefs, and preferences in the content you place before them.
Take the cosmetics retailer LUSH as an example. The majority of the customers it targets are those who oppose the use of animals and are vegan. On its page for products there are a number of references to causes that its target customers would like the company to stand for:
What happens if my market shifts?
The market you’ve identified for your business’s future isn’t necessarily a guarantee. Product development is constant, and purchasing patterns change and they both influence the demographics of those who is most likely to purchase your product.
Keep in mind that running an e-commerce business requires constant refinement and testing to help determine your market even if you believe that you’ve succeeded. The marketplace, just like your business, is always evolving. A smart business owner recognizes this fact and continuously studies and adapts their strategies to adapt to the changing needs.
Gerrid Smith, Chief Marketing Officer at Joy Organics
How do you decide when it’s time to change direction? “When you feel that there’s too much competition in your niche or you realize you’re not attracting enough customers to be profitable, changing the direction of your business can put you on the path to success,” Says Shaunak Amin, co-founder and CEO of SnackMagic.
Shaunak’s venture is a wonderful illustration. “My latest venture is a direct result of the global pandemic,” Shaunak says. “As no one was at their offices, but instead being in quarantine in their homes, we realized that giving and receiving, a supply of food items would make people feel more connected and increase morale in the midst of the lockdown. What started out as a means to keep our delivery service for office lunches turned into a lasting, beautiful pivot.”
The product of SnackMagic was redesigned to address an entirely different need in the same market which still allowed the company to meet its objectives.
“From day one, we wanted to create a business, not necessarily a startup,” Shaunak states. “We would like it to be an established company with revenue as well as losses, profits and unit economics right from the beginning. Therefore, we took advantage of our runway that we have from STADIUM to develop SnackMagic. Our website was awash with visitors to look around before we started Our first order arrived within 3 weeks.”
The results were stunning: SnackMagic scaled from $0 to $20 million in annual recurring revenue only eight months. “We’ve shipped thousands of SnackMagic snacks worldwide, and we’re just getting started,” Shaunak declares.
Target market examples
Are you ready to put your study into action? Below are 3 examples of targeted markets that you can draw ideas from.
Nike
Nike is a name in sportswear recognized for its wide market reach. Nike products are sold in more than 170 countries and millions of customers contributing to its $17.3 billion in sales in the US in the US alone.
The market that Nike is targeting is large. However, the brand segmented its market in smaller groups and develops customized experiences for each. For instance, its marketing strategy is geared towards certain segments of the market:
Nike customers who are part of members of the Black or LGBTQIA+ community are targeted through Nike’s YouTube series.
The Nike “Guide to Summering” advert is targeted towards a specific segment of the Nike’s market that are interested in travelling.
Nike’s “Toughest Athletes” advert represents women who are interested in fitness.
Although Nike is a name that is popular with people who share a common fascination with fitness, those who purchase from Nike cannot help but feel as if the brand is interested in their back. It is a sign that people are dressed, look and feel the exact way, thanks to targeted ads.
McDonald’s
Sometimes referred to as the “home away from home” for its customers, McDonald’s also has a massive target market. Its help online portal states:
“McDonald’s is a place that provides an enjoyable, friendly atmosphere for everyone and we’re not just talking about everyone to take advantage of. This includes that we appeal to families who adore our signature Happy Meal(r) as well as to employees who are on the go and want to eat breakfast, or coming inside to enjoy our freshly ground espresso and free Wi-Fi. The majority of our ads are shared with everyone to ensure that they reach a wide coverage. You might see us advertised on television as well as heard about us over the air!”
In the UK The brand’s reach is different segments of the population, like people who have recently got an exciting new job, are concerned about climate change and enjoy drinking–with ads that portray those who fit into every.
Furthermore, instead of sending every US clients back to advertisements in English It translates each Facebook advertisement into Spanish for those who are in that segment of the market:
Play-Doh
We’ve all heard about Play-Doh, the clay used by children to make small models. However, the initial market for Play-Doh could come as the surprise of your life.
“Play-Doh was originally invented to be a wallpaper cleaner,” says Nick Saltarelli, co-founder of Mid-Day Squares. “It was developed in response to what the Kroger store believed to be a great use case for a particular market. The product was successful but it slowed down over time.”
Nick says, “It wasn’t until the daughter-in-law of the founder approached them with an idea that she thought she could use for her school’s nursery students to play with their imaginations Play-Doh came into existence. Similar product, different market.”
Play-doh was a huge success and is one of the top toys for children of all time. The only thing I can see between the two concepts was that the first was the result of an intuitive thought.
Nick Saltarelli, co-founder of Mid-Day Squares
Find out who you can reach and how to do it with market research on your target market
Your customer base is the mainstay for your business. They’re the kind of people who deposit money into the bank accounts of your business, grow into regular customers and recommend them to their acquaintances. To show them that your existence and persuade them to make the first purchase, you have to be aware of who they are.
Start by asking questions of your current customers, examining your marketing analytics, keeping tabs on your competitors, or holding focus groups. Be on the lookout for trends that the people who are most interested in your product are sharing.
However, not every segment of the market you are targeting happens to have everything they share. Determine the variables that define segments of your market share, such as geographic location, income levels or even hobbies and interests.
