It's important to remember that the focus of marketing is people. If you're concentrating your efforts on your product or profit only, you'll miss the mark. The term target market is used because that market– that group of people–is the "bull's eye" at which you aim all your marketing efforts. So, don't forget that a market is people... People with common characteristics that set them apart as a group. The more statistics you have about a target market, the more precisely you can develop your marketing strategy.
The table below shows some examples of market segments (or groups):
Type of Market Segment Shared Group Characteristics
- Demographic Segment Measurable statistics such as age, income, occupation, etc.
- Psycho-graphic Segment Lifestyle preferences such as music lovers, city or urban dwellers, etc.
- Use-based Segment Frequency of usage such as recreational drinking, traveling, etc.
- Benefit Segment Desire to obtain the same product benefits such as luxury, thriftiness, comfort from food, etc.
- Geographic Segment Location such as home address, business address, etc.
Here are examples of target segments that can be created using the above table:
- Women business owners between the ages of 25 and 60 earning more than $25,000 annually form a demographic segment.
- People who drive compact cars due to their fuel efficiency form a benefit segment.
- Be careful not to confuse a geographic market segment with a place. The market is the people who live in the sunbelt area, not the sunbelt area. This is a common mistake made by business owners that causes them to lose a marketing focus on their customers.
Design Marketing Strategies With Your Target Market In Mind
The reason we're concerned with identifying a target market is because it makes strategies for designing, pricing, distributing, promoting, positioning and improving your product, service or idea easier, more effective, and more cost-effective.
For example, if research shows that a sturdy recyclable package with blue lettering appeals to your target market and if you're focused on that target market, you should choose that type of packaging. If, however, you're product or profit oriented–rather than people oriented–you might simply make the package out of plain styrofoam because it protects the product (product oriented) or because it's cheap (profit oriented).
Here's another example: If you know your target market is 24to 49-year-old men who like rhythm & blues, are frequent CD buyers, and live in urban neighborhoods, you can create an advertising message to appeal to those types of buyers. Additionally, you could buy spots on a specific radio station or TV show that appeals to this type of buyer, rather than buying general media time to "kind of cover all the bases."
In summary, when you're making marketing decisions and you say "kinda," it's costing you money. Know whom you are aiming for (your target market) and create a strategy for a direct hit.
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