More people than would like to admit.
In fact, after working with businesses of various sizes across very diverse industries for more than 20 years on branding initiatives, I would venture to say just about every small- to medium-sized business. The fact is, most businesses are deathly afraid of choosing a target market. Here’s why.
Business owners often think by choosing a target market, they are being elitist, putting all of their eggs in one basket, or leaving a bunch of money on the table by not trying to serve “the world at large.” They think they are missing an opportunity by not being as general and broad as possible, when the fact is that they are missing the opportunity to be important and meaningful for a much smaller and more influential (or more appropriate, or more enjoyable, or more profitable) audience.
They seem to forget that choosing a target market (or target audience) is choosing or refining who to aim their branding and marketing efforts at, which is not necessarily the same is as serving only those customers, and no one else.
The idea of targeting your branding and marketing is to identify those customers that are most likely to value what you have to offer and most likely to buy. Too many businesses use a buckshot approach, trying to appeal to everyone, which is random, diluted, and expensive. It’s not just more effective—it’s actually a hell of a lot cheaper—to market to a target population than to try to market to the world.
Remember, a brand becomes stronger the more you narrow the focus. Part of building brand strength is narrowing the focus of what you have to offer and why it’s important—your value proposition. That means not trying to be everything to everybody. As one of our partners over at digital design agency Needmore Designs put it, “If you don’t have anything that you ”˜really do,’ then no one thinks of you as the answer.” Exactly. (More on value proposition and uniqueness in a future post.) And then the next part is narrowing the focus of who you are offering it to. If you’re not trying to be everything to everybody…then who is it that you are trying to be something important to? That’s your target market.
So, how do you get started?
First, do a historical review. Ask questions like:
- Which customers have you won or lost?
- Which customers have been most profitable?
- Which customers have been more likely to buy frequently or repeatedly?
- Which customers tend to become either rabid fans or more loyal?
- Which customers pay on time, create fewer problems, or can influence others?
- Which customers do you enjoy working with or selling to?
In addition you should be thinking about things like:
- Your vision for the business and where you want to go.
- What your values are, and which customers would best align with them.
- What products or services you are best known for, and what you’d like to grow, and why.
- What products or services are most desired or most essential to your customers, and why.
- What you do or sell that’s uniquely different from your competitors and why a potential customer should prefer you or your product.
These questions will help you begin to hone who would represent your ideal customer and, by looking at what these customers have in common, your target market. That target market may very well be defined by shared demographics (those typical things like age, gender, geography, income, education, etc.) but also by psychographics (things like common values, attitudes, lifestyles, aspirations, or emotions) or needs.
It would be a lie to guarantee you won’t lose a single customer in the process of defining a target market. To get the full value of choosing a target market you have to be willing to walk away from some customers or some sales in favor of the ones that move you in the direction you want to go. That direction may not resonate with some of your historical customers; some may opt out. In practice, I’ve found that unless a company is going through a drastic adjustment of strategy, that’s typically fewer losses than you might think. But it’s also part of the general lifecycle and maturity of a business that your market and customers will evolve.
The people that don’t come back are likely those that would have moved on sooner rather than later, anyway. Or that might have stood in the way of your progress. If you lose a couple random customers, but gain relevance to a sizable group of new customers who are a better fit to your business, isn’t that worth the trade-off? What you’ve done is intentionally put out a welcome mat for a specific population or need that you desire to serve, indicating that you are specially equipped to help them, or that your product is the perfect match. You’ve just helped this new customer base choose you from a bewildering array of options.
In reality, many people will likely continue to come to you or be referred to you organically based on your business history and acumen or great products, regardless of whether they’re the ones you’re laser-focusing your branding and marketing on. You’re not necessarily closing your door to old clients or turning these customers away, you’re just not choosing to focus your “magnet” on them for the future. Remember, when you are creating your target market, you are trying to define your ideal customer and shape the future of your business. It doesn’t mean that your target market will be your only customers; just your best.