Finding your Target Market

Lesson 1.3 Activity 2

A market is all potential customers who share common needs and wants and who have the ability and willingness to buy the product.

What is a Market?

Target Marketing

Target marketing is focusing your marketing decisions on a very specific group of people.

The more information you have on your target market, the easier it is to make marketing decisions.

Customers versus Consumers

Remember, a customer purchases the product, and a consumer uses the product. If you are selling baby food would you target: Infants? Mothers of young children? Fathers of young children? Elderly people?

Who is going to purchase the product?

The First Step

The first questions you should always ask yourself when introducing a new product are:

Who are my customers? Who will buy my product?

Many times people either have no idea who will buy from them, or they assume that “everyone” will.

Assumptions like this can lead to

wrong decisions,

wrong pricing,

the wrong marketing strategy,

and, ultimately,

business failure.

The most successful small business owners understand that only a limited number of people will buy their product or service. The task then becomes determining, as closely as possible, exactly who those people are, and 'targeting' the business's marketing efforts and dollars toward them.

Always refine your product or service so that you are NOT trying to be “all things to all people”.

Become a specialist – one product cannot satisfy everyone’s needs and wants!

To satisfy basic needs.

To solve problems.

To make themselves feel good.

You also need to understand that people purchase products or services for three basic reasons:

You'll need to determine which of those

categories your product or service is the solution to, and be prepared to market it accordingly.

Remember….

The strength of a particular marketing mix depends on two things:

1. How well the target market is defined, and

2. How well all marketing decisions are directed toward that market.

The Marketing Mix

The Marketing Mix is made up of four basic marketing strategies known as the

Four P’s:

PRODUCT PRICE

PLACE PROMOTION

Product

This includes what product to make, how to package it, what brand name to use, and what image to project.

The product must be one that consumers want.

It must have the features and qualities consumers expect for the price they are paying.

Price

Should reflect what customers are willing and able to pay.

Companies have to search for the price that enables them to earn the most profit.

The price must cover fixed costs such as rent, and variable costs such as materials and labor.

Companies must be careful not to overprice their product or their competitors will gain the advantage.

Place

This is determining how and where a product will be distributed.

Must be in a place when and where the consumers will buy it.

A poor location will cause many businesses to fail.

Also includes locations within a store.

Promotion

How potential customers will be told about a product, what the message will be, when and where it will be delivered, and with what inducements to buy.

If a customer doesn’t know about a product they won’t buy it.

Advertising tells customers what products are available and gives them reasons to buy it.

Examples of a Target Market

A. Sports minded males 18-35 years old

B. Males and females 12 to 18 years old

C. Females over 40 who are style conscious

D. Males and females who are health conscious and parents of young children

Which product matches the target market?Canoe Sport Cologne for men ______

Nice n’ Easy Permanent Hair Color ______

Canon’s Digital Disposable Camera ______

Kellogg’s Heart and Healthy Cereal with Marshmallows _______

In the next lesson you will learn how to use market segmentation to further define your target market and create your customer profile so you can zero in on your target market.