Before starting a business, as with anything, it is imperative to first identify your why—the pillar of strength upon which everything else is built. After discovering the core of your organization, the next step should be to define who you do it for—the fuel that keeps you running and the very people that keep you in business for the long haul.
As you work towards becoming part of the 10% of successful businesses, you have to strategically aim for the right target market, i.e., by identifying key market assumptions so that your business can provide maximum value, and build a unique brand that occupies a special place in your target market’s hearts and minds.
Who is my target market?
At the onset, you should already know the people who will really, really want to buy into what you’re selling. Focus on one target market alone, and focus hard. As a business owner, the barest minimum expected of you is to find a way to address one of your target market’s problems by either (1) removing pain points, or (2) highlighting positive feelings. To do so, you must be able to enumerate major assumptions about this specific group of customers.The key to staying relevant is creating a brand and business plan that addresses a need, want, or demand, preferably in a way that hasn’t been done before.This doesn’t necessarily mean solving a social issue or a major problem; it could be something as simple as introducing efficiency into daily tasks or making everyday living just a bit easier.
Take Uber, for example. Studying cab riders in key metropolitan cities, the company’s founders, Travis Kalanick and Garrett Camp, identified a glaring problem with the way cabs were being hailed. And while no one in particular was complaining, they thought, “there must be a better way to catch a ride,” one that removes the trouble of having to flag down cabs on the curb, just to get turned down. It was a simple solution, but one that was impactful nonetheless. As we all know, the rest is history.Strike gold by finding similar problems that need solving.
To quote the wise words of Professor Theodore Levitt of Harvard’s Business School: “People don’t want to buy a quarter-inch drill. They want a quarter inch hole.”
Why is a target market important?
Although sticking a specific target market might sound limiting at first, it actually allows you to focus on who really matters. Targeting a specific set of people doesn’t mean closing your brand off to the others who don’t belong to that group. Rather, it means strengthening your brand and designing effective marketing strategies around an ideal customer.Knowing who you’re particularly selling to brings you closer to your audience, allowing you to empathize with their needs and concerns. As a result, you may even discover new ways and design better solutions around them.Form intimate relationships by forging strong connections with a specific target market. At all costs, avoid trying cater to all, because you will end up catering to none.
How do I define my target market and make key market assumptions?
To understand how you can provide solutions for your target market, begin by identifying key market assumptions about the them.First, identify your target audience using a demographic profile. That is, by using factors like age group, gender, socioeconomic status, educational background, occupation, and the like. These will give you a basic idea who your target market is and what they like.Second, elevate the depth of your assumptions using a psychographic profile. Doing this validates any assumptions you may have already made through a demographic study. A well-made psychographic profile should contain salient details like purchasing decisions and thought processes, underlying motivations, and, most importantly, values and opinions. These will tell you a lot about your target market, including who they are, how they behave, and why they behave the way they do.Third and last, tie it all up and come up with a comprehensive list of common purchasing patterns and spending habits of your target market. Understand the different ways your customers interact with your product—i.e., why they use it, when they use it, and how they use it. Keep all of these in mind and you’ll be off to a great start.
In this brutal environment we call business, only the best 10% make it to the top. This calls to mind Darwin’s age-old adage, “survival of the fittest.”
As we attempt to survive, grow, and eventually thrive, we must learn to formulate valid key market assumptions about the people we cater to. Learn who you’re selling to and learn to communicate with them. Empathize with your customers, wow them with innovative solutions to their most pressing needs, and seal your special place in their hearts and minds. Now that you’ve defined your target market and identified important key market assumptions about them, the next step is to validate these assumptions through proper market research to see if they hold up to scrutiny.