Targeting the Right Audience for Your Business

Nov 17th, 2010 by Max Tokman

The idea behind target marketing is to increase profits (or traffic to your web site) by first identifying, and then targeting smaller, yet more profitable customer groups within the total market. By allowing businesses to spend fewer resources to attract more profitable customers, target marketing is easier and more cost effective than broader, more traditional marketing methods.

Sometimes known as niche marketing, it starts with the notion that your web site or product cannot be all things to all people. The most successful businesses understand that only a limited number of people will buy their product or service. The key to good strategic marketing is identifying who these people are and what drives their purchase decisions.

Methods of accomplishing this range from complex segmentation models to simple profiling, depending on the outcome you’re trying to achieve. The most common types of market segmentation are:

  • Geographic
  • Demographic/socio-economic (gender, age, income, education, household size, etc.)
  • Psychographic (attitudes, values, lifestyles)
  • Behavioral (purchase habits, degree of loyalty)

You can start by looking at your current customers. Where do they live? Use this information to research region-specific demographic and socio-economic data. U.S. census data is a good start. A tool like Claritas’ Prizm can also provide lifestyle information, identifying groups within specific zip codes such as Urban Achievers or Young Digerati, for example. Talk to your customers or survey them. Find out as much as you can and use this information to create a picture of your 'ideal' customer or who you want him/her to be. Focus on collecting information that is actionable and useful in finding your target audience and creating messaging that appeals to them specifically.

For example, Company X conducts a short survey of their customers to uncover that they’re primarily young men, ages 18 to 29, college-educated and incredibly web-savvy. By asking questions about their internet browsing habits, Company X discovers that this group generally spends only the minimum amount of time necessary to get the information they want from the web sites they browse. They also lead busy lives and are generally pressed for time. Company X uses this information to create a digital strategy that addresses their web preferences as well as time constraints. They also tailor their messaging to appeal to young men with busy lives. By doing so, they spend fewer resources to target a small group with a much higher likelihood to purchase.

The process of identifying and studying potential customers for your business doesn’t need to be complex or expensive. It just requires that you find out everything you can about the customers you intend to pursue. Understanding your current and prospective customers will mean creating a digital strategy that’s relevant to their needs and that demonstrates that you “get” them. This, in turn, will allow you to attract and retain the kind of high value customers that are critical to your business’ success.

Once you’ve honed in on your target audience, how will you differentiate yourself from the competition? To answer this question, in our next piece, we’ll take a look at relationship marketing as a proven tool for creating lasting consumer relationships beyond the transaction.



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