Discovering Your Target Market

When I begin working with a new business, one of the first things I ask the owner is, “Who is your target market?” Unsurprisingly, the answer I usually get is, “Everyone”.

I can promise you that your product or service won’t appeal to everyone, so let’s start with the basics. Who is most likely to go for what you’re trying to sell? Is it…

  • Men or women or both?
  • Younger people, older people or both?
  • People in a certain area of the world, country, state, city or neighborhood?
  • People that earn a certain income?
  • People who are single or married? Have kids or don’t?
  • People who’ve completed a certain level of education?

Let me give you an example. Let’s say I am launching a make-up company that only uses ethically sourced, organic materials and contains no chemicals. My cheapest product is a lipstick, which retails for $18. Everything is American made.

From that basic information, I can segment my audience down using a few assumptions:

  • I sell makeup, so my target market will mainly be women
  • My price point is higher than average, so I can assume my target market will probably be women who are at least 30 years old and have a higher than average disposable income.
  • I believe that as women get older, they typically become quite loyal to the beauty products that they use. So I am going to assume that my target market probably tops out at about 45 years old.
  • My products are American-made so obviously, I am targeting the American market. But because one of my points of difference is organic and ethical, I will most likely find women who are interested in those kinds of products in larger cities with greater affluence and wider exposure to environmental and health issues.
  • My product is not specific to marital or family status, so I’m going to skip this one for now.
  • Again, because of my price point and my point of difference, I can assume my target market will be college educated.

So now we’ve gone from “Everyone”, to:

  • Women
  • Aged 30-45
  • From affluent neighborhoods in major cities
  • Who earn an above average income
  • Who are college educated
  • Who actively care about the environment and their own wellbeing

Now you give it a try.  If you get stuck on one question, ask yourself what type of customer you’d want to attract. For instance, in my example, I got stuck on marital and family status. But when I think about it, I know that moms are super busy, and buying organic lipstick is probably not right on the top of their to-do list. This is a wicked generalization, but for the sake of an example, I’m going to ask you to go with me on this one. So from here, I might then determine that I’m better suited to target people who don’t have children. I can make other determinations as well. For instance:

If I know my target customer cares about the environment and her own wellbeing, I can probably assume that she eats healthy, shops in upscale groceries stores, and exercises a few times a week. Also, since she likely lives in a big city and earns an above average income with a college degree, I might be able to deduce that she has a professional job, possibly in a management role, or that she owns her own business.

So now we’ve gone from “Everyone” to:

  • Women
  • Aged 30-45
  • From affluent neighborhoods in major cities
  • Who earn an above average income
  • Who are college educated
  •  Who actively care about the environment and their own wellbeing
  • Who don’t currently have children
  • Who eat healthy, shop in upscale groceries stores, and exercise a few times a week
  • Who have a professional job or own a successful business

Now we’re getting somewhere! Now that we know a bit more about our target market’s personal demographics, we can begin to think about how we might be able to find and attract her with our marketing efforts. So, as an example, I might think about:

  • Creating an ad on Instagram showcasing a woman with beautiful, natural makeup that specifically targets women who fit into my categories
  • Writing some articles about the long term effects of chemical-based makeup on LinkedIn, where I know I can find educated, professional women aged 30-45 who are following tags about beauty
  • Researching events in my target geographic locations where I might find my customers, such as farmers markets, yoga workshops or fitness events
  • Looking to partner with a bigger, more well known retail brand and offer mini makeovers in their store

You get the idea.

When you start a business, no matter what kind of business it is, you have to begin by defining who your customer is, how they live their lives and why your product or service suits them to a tee. Once you define that customer, you can begin creating a marketing plan to match. But we’ll leave that one for next time!

Stuck on where to start? We can help! Get in touch.  

What Defines an Entrepreneur?

Entrepreneur. People like to throw the word around; it sounds fanciful and laden with opportunity. It can transform any Tom, Dick or Harry into an impresario. But entrepreneurism is so much more than how it’s perceived. It’s not a category as much as it is a characteristic, an unremitting drive to build, develop, learn and grow. It’s a way of life.

I grew up in a middle-class suburb in Connecticut, surrounded by a family of small business owners who had to make major sacrifices to give us kids a good upbringing and a proper education. My parents made it look easy of course, with dad working from six to six and then mom running off when he got home to get to a catering gig. To me then, they were just mom and dad. To me now, they are heroes. But that’s what it’s all about. Being an entrepreneur is a bit like fighting a war, and some people are built for the battle.

Every day I make decisions that are terrifying, risky and have consequences that can make or break me. But with all the fears and uncertainty comes the rewards, which are much more satisfying when you look back at the road you took to achieve them. 

Anyone who has experienced success knows that it only takes one time to learn from a mistake, and anyone who has built a business knows how valuable those mistakes can be.  The longer you’ve been in the game, the better you know how to assess risk, which is one of the most valuable assets any business builder can have.

There is a certain romanticism about creating something that improves people’s lives. The right opportunity is one that gives you that Indiana Jones factor, the thrill of taking risks and seeing the possibilities. That’s the definition of an entrepreneur. Success waits for no one, so you have to be able to spin on a dime, move with the market, change, adapt and respond. In order to build a business, you have to know how to move around the ring. Sometimes you’ll throw few good punches, and sometimes you’ll get knocked down. The hits are the only way you’ll know which way to move in the next round.

In entrepreneurism, there is no blueprint, no floor plan, no prescription for success. If you want to make a difference, you have to be different. You have to create your own rules, break the mould, and be ready to be disruptive. Ultimate success has never been achieved by a disciple of the system.

 

Human Capital

If you’re an entrepreneur or small business owner, you’ve probably seen Shark Tank once or twice recently. If you’ve been living in a hole, or just live off Netflix, the concept is relatively simple. A contestant presents his or her idea to a panel of judges from varying successful backgrounds and the panel decides if the contestant’s business plan is worthy of an investment. It’s not particularly groundbreaking, but there’s a reason shows like this are so popular. It’s because people around the world share the same dream of success.

There are very few original ideas out there, and even less that make sense as a long-term investment.  The media puts success stories on a pedestal so people like you and me see the Uber phenomenon or Snuggie sensation and think, “Hey! I can do that!” But for every great Cinderella story, there are thousands of hard working entrepreneurs that don’t make the grade. For most people, ideas don’t pay the bills.

Every successful business owner shares similar qualities: determination, patience, endurance, courage and adaptability - among others. With every idea comes a level of innovation, but a owning a business isn’t about being the first, it’s about being the best.

People who do well are the ones who stick with their dream, no matter what hurdles they come up against. Starting a business usually involves copping a lot of criticism, not only from outsiders but from close family and friends. People won’t understand your message, they won’t believe you can achieve, and they’ll make you doubt yourself. The key is to keep selling it. You have to transfer your self-belief to the people around you. And quitting is not an option. An entrepreneur can’t be afraid to have a go, no matter what the critics say. There has never been a successful businessperson who hasn’t made a mistake; I myself have made plenty of them! It’s the preparedness to make those mistakes, and the readiness to learn from them that builds success.

Transforming an idea into a business isn’t just about the right attitude and having the dedication to make it work. Businesses, both start-ups and otherwise, need capital to operate. The importance of money is both indispensable and non-negotiable, no matter what your business goals are. But there is another resource that’s irreplaceable when it comes to transforming an idea into a business.  It’s what I like to call human capital, or people investment.

A good business can’t operate with one person alone. Different people have different strengths and weaknesses, and it is the dynamic of a well constructed team that makes all the difference. As with any idea, the original light bulb is important, but the incubation process is what defines its viability. In my company, I find that the interaction, experience, beliefs and attitude of my extended are what transform an “ah-ha” moment into something that’s actually conceivable. 

People investment isn’t just about cultivating a great environment; it’s about finding people who have been there and done that to mentor the process. Any entrepreneur who wants to transform an idea into a lucrative reality has to have an advisor who will ask the tough questions. Too many people think they can do it all on their own, and this is where most inexperienced entrepreneurs make their first mistake. Think about the people you know who spend $200,000 to buy a business and end up earning $50,000 doing a job. That’s the difference advice can make. It’s an investment to find out what your idea is worth. What’s $1,000 in comparison to years of potential waste? We all know that nothing is for free, so make your first investment one that will not only count today but every day on the road ahead.

In business, execution is everything. An idea might be one that can change the world, improve the way we live, or give us a whole new outlook on how we see our future. But it is the way in which an idea is brought to fruition that gives people the real opportunity to see its potential. Dreams are often bigger than reality, but it’s reality that shapes the way we build our success.