Who wouldn’t want to buy a laser pen that zaps away all calories from even the most decadent deserts? You could sell it to anyone who eats. While anyone might be interested in this product, few companies have the resources to market to everyone. Instead, they target people who are likely customers. That’s where they get the biggest return on their marketing dollars. Here are some tips to narrow down your primary target market to those most likely to buy from your small business.
Check Your Inventory First
Start with an inventory of your current client base. Look for patterns. For example, do they cluster around certain age groups, neighborhoods or income levels? Listen to them describe their day. Social media sources like Facebook can also give you clues to their buying motives and behavior. Pay special attention to your A-list customers.
The point is to develop a profile of your typical buyer. It’s a snapshot of your success so far. Perhaps there are others in this group that will buy from you as well.
Know Your Neighborhood
Knowing more about the people in your market area can help you identify other potential buyers. Look for groups of people whose characteristics match up with what you offer. For example, people who own homes might be a target for house painters. You could divide it even further between single or double-story homes.
A great source of this information is the U. S. Census Bureau’s American FactFinder. It helps you find free demographic information about your area. For example, a search of Rio Rancho, New Mexico indicates that 16 percent of residents are veterans. Knowing that, you might target the segment with special discounts when they show their military IDs.
Evaluate the Segments
Defining narrow market segments is a good start. But it’s also important to assess whether it’s worth devoting resources to them. Here are several areas to look at:
- Size – Is the segment large enough to be sustainable? Is it growing? For instance, an average of 10,000 people will turn 65 each day for the next 20 years. If you offer services to seniors, that’s a good sign.
- Competition – Who else is serving this market? Can you profitably offer them something better than your competitors? Remember, it doesn’t have to be a better price. Many small businesses compete based on personalized service instead.
- Access – Are you able to reach them? You need to be able get in front of them to tell your story. Say you want to target promising customers in a neighboring state. If you don’t have the appropriate licenses to operate there, you won’t be able to reach them.
Maximize your marketing resources by targeting markets that are likely to produce the best results. Start with these tips to help you narrow you audience to those most likely to buy from you.