Your target market includes anyone who buys your products. While most of us have a sense of the broad groups (women, ages 20-60, who like our products), market segmentation (what I’m really talking about here) can help us narrow the field into manageable groups for whom we can:
- Develop Products
- Develop Promotional Campaigns
- Drive Social Media Campaigns
- Focus Your Brand
- Differentiate From The Competition
Understanding your target market helps you narrow the field for what wants your product(s), when, and why. Instead of creating products your current market doesn’t want, you can focus your efforts on their needs and desires. Instead of crafting marketing messages to young women, you’ll know it’s really middle aged women who want your products most. Instead of believing your market is society’s elite, you may learn they’re struggling single mothers who live paycheck to paycheck.
If you’re a B2B service company, focus your efforts on the buying decision maker – not just the end group with whom you’ll be working.
If you’re an Etsy shop, recognize that the broader Etsy market is predominantly women (87% in 2016), so if you don’t have a product line specifically for women, you may run into some challenges. However, if you have a high-demand niche product specifically for the kind of men who use Etsy (creative, young, etc.), you might be a big fish in a small pond – a desirable position when it comes to business.
It’s Not About Adding People But Subtracting Them
Targeted marketing is about removing the fluff and narrowing your market so you don’t waste energy on unlikely prospects. I see too many Etsy sellers (in particular) targeting “women between 20 and 75”. The trouble with targeting so broad is that nothing defines your business as different from all the other sellers on similar items or gifts. Better you should narrow your niche and hone your message than be all inclusive – even if you do it by choice (self-defined or avoidance-defined below) or metrics. Otherwise, you may fail to differentiate and capture your little corner of the market.
Why It Matters
Think about this. If you want to craft products and messages for the following groups, how would you do it? Company A is targeting women between 20 and 60 who use Etsy. The market is huge and their desires, values, and income levels are all dramatically different. Unless there is some uniting factor (they’re all into Cosplay, for instance), any given crafter, jewelry maker, or seamstress will have trouble honing both products and the message.
Company B on the other hand has some goods. Because it’s targeting educated young women, it also focuses on educated women who are thinking about having babies. These women are different from the 50-something grandmas in what they find important. If Company B produces baby stuff, marriage stuff, and wedding stuff, it’s going to have a far easier time attracting loyal followers.
If you consider a third Company C (the cosplay one), ages and incomes are not as relevant as the fact that this company makes cosplay accessories and party invitations. Company C narrowed its niche by lifestyle and hobbies more than demographics. Plus, the messages that will appeal to this group are even more clear than those for Company A and B.
What Should You Learn?
The more you can narrow each group, the better. Focus on narrowing to a target market small enough to penetrate but large enough to have strong demand for your particular products.
1. Buying Decision Maker
For B2B companies, focus on the person who hires you. For Etsy companies, the buyer. For instance, for baby clothes your market isn’t babies, but whoever buys clothes for babies.
B2B service sellers probably focus on a given region. But Etsy sellers can ship product all over the world. While it might make sense to focus on your home country, you may want to avoid alienating others due to language barriers.
3. Gender Distribution
The ramifications are probably obvious. Bear in mind, Etsy sellers, that as of 2016, 87% of Etsy users were women. If you’re selling to men, you may want to spread your wings.
4. 10-Year Age Ranges
Use an age range that narrows your niche rather than one that expands it. I often recommend focusing on ten year ranges to focus products and messaging. Sometimes age will naturally be narrowed by the product line itself (think baby items for women between 25 and 35).
5. Spending Power
Rather than traditional income level, consider assessing disposable income levels. Especially for Etsy sellers, most of the products are more “want” oriented than “need” oriented, so disposable income is more valuable. Divide into ranges of “low” “mid” and “high”. Some income assumptions can be made by education level and profession categories.
For Etsy sellers, education level may not be important for sellers of gifts and other unnecessary objects. For B2B entrepreneurs, it will factor greatly in messaging and product development.
The root of B2B solopreneurs market, but less obvious for Etsy sellers. However, if your research indicates a lot of buyers in a given career, it might mean help you develop new products for similar types.
8. Marital and Family Status
It may make sense to focus on either families or singles. Their spending habits are different, but be careful not to narrow the market too much – i.e. singles over 50 – because the market might be small to serve.
9. Ethnic Background
May be a consideration if the product line is ethnically leaning. For instance, if you make hair accessories for black women sporting natural hair, new products and marketing can focus unaddressed natural hair needs.
10. Media Preferences
Television shows, music, and movie preferences can tell you a lot about who is your customer. List 10 things in each category you believe your customer would enjoy.
11. Lifestyle Behavior
Hobbies, and pets may all factor into what makes your ideal customer. Be sure to ask yourself what types of things your market cares about. Try to list 15 activities in which they actively participate.
Defining values is like a big game of would they rather. Go as deep as you can to determine what customers care about morally, spiritually, and politically. List at least 15 things they find important.
How Can You Find Target Market Data?
Before you sell anything, it can help to define what you want your market niches to be. Recognize you might get it wrong and it may change over time. But define the data from above, narrowing the ranges as specified.
Alternately, you can define all the people you want to avoid. I knew religious people and little kids were never going to be part of the market. This helped me realize that atheists and child-free people might be an interesting niche. You can also define people you just don’t want to deal with day-to-day. Don’t want to deal with men or business suits or rough-and-tumble ranchers? Make a note. Their opposites might be part of your greater target.
3. Related Assumptions
You can also define assumptions based on whatever you discover from the first two challenges. For instance, if you narrowed your target age group to women 25-35 with a college degree, you may also be able to assume most of them are thinking about marriage and babies because most women in this age group are. That is, unless you’ve Avoidance-Defined that you don’t want customers with kid. In which case babies may not be on the agenda but career probably is. See how that works?
Take what you’ve already defined and narrow the niche further into assumptions that can be made on what you’ve already decided. Below are some other assumptions that may help. If your market is mostly men on Etsy, you may be able to assume they are either associated with a woman who uses Etsy or are creative themselves. Or, if you know you’re targeting middle aged women, you can assume they have grown children (most do), have been married (most have), and may own a home (depending). See the resources at the bottom of this article for more ideas.
4. Product Needs Fulfillment
Whatever needs your product serves can help you understand the customer as well. Obvious people having babies are typically between 20 and 35. Men needing fancy razors of all ages probably value the shaving experience, beautiful things, and may have groomed beards or bald heads (and may not be seniors since at that point many men either have less hair or are less concerned about their appearance). Tapping into whatever unique need your product serves can help you identify some of the components above.
5. Creepy Stalking
Sometimes before you have customers (and even after), you can glean information by sampling your followers on social media and elsewhere to learn a few things about them. It’s a great way to assess whether your initial assumptions are on point or not. You can discover gender, age, and maybe some general lifestyle information. Depending on where you look, you might be able to assess profession, income ranges, and more. It’s a bit creepy, so be careful not to store data by name. Just store whatever you find out and look for patterns in your data.
6. Social Media Activity
Expanding on the creepy stalking, pay attention to the most liked and commented social media posts. Those people also represent a core niche – your cheerleaders. So discover what you can about them as well. And use the knowledge from your favorited posts to develop more promos, ads, and products with similar themes. Also, Facebook and other platforms offer some collective data to begin with. Just go to your page then click Insights > People for age, gender, and location data. You can browse around to see the distribution for different actions as well.
7. Google Analytics
Google Analytics offers viewer demographics right in the software. Under Audience > Demographics you should have an option to see the data. You may need to turn it on and the information may be limited, but it’s another quick and dirty way to get a feel for who your customers actually are.
8. Customer Survey
I love this method and have used it myself. Craft a survey (this can be an art, so research methodology first) and offer it to customers post-sale. Sometimes customers are quick to help and give their opinions. Other times you may need to incent them with a freebie or coupon. If you go this route, be sure to include some “How am I doing?” questions for the service end of your business.
9. Complementaries Stalking
Companies selling products that match yours can be an interesting area to discover data and needs. For instance, if you sell baby bibs those new mothers are also seeking cribs and strollers. Follow some of those organizations you admire and “match” to glean data about your own market.
10. Competitive Stalking
Especially when larger companies are capturing some of your market (I’m looking at you, KnockKnock), it can I help you understand who they are and what’s missing in the market.
11. Buy Data
Helpful Resources below has some affordable data analyst groups and ideas. We aren’t all trained or built to see patterns, so getting data and even analysis from the pros can help us cater to our audience with more precision.Helpful Resources