Seven Steps to Targeting Your Company’s Niche Market
Looking at the business scape, and the market scape, you could probably figure out pretty quickly that not everyone out there is your market. If you aren’t a market leader, such as Wal-Mart or Target, you probably don’t have much control over who that market is. The reality is that despite our best efforts, most of the time, our markets will choose us – including what we provide, how we offer it, the price they will pay for it and how they get it.
If you compare your business to a vehicle, you’ll note that there are vehicles that are meant for speed, others that are meant for touring, others, still, that are meant for off-road experiences. The models are created to meet the purchaser’s expectations at a price, level of service and expectation that meets the expectations of the desired consumers.
This makes it vital, as business owners, to learn about the companies and individuals who are purchasing from us. As business leaders, we cannot afford to simply take the crowd sourced perspective on how to identify and reach our target markets. It is a combination of information that you, as the business leader, are probably in the best position to pursue, just like the business leader, in young companies, is the best person to cast the vision for where the company is going. While companies like my own might help to clarify and organize the information, if it is not the business leaders’ vision, it is typically not as successful as it could be.
While there are a number of ways to identify and connect with your target audience, here are a number of tools that you can use that will help:
- What you are selling?: Unless you are going into the commodity business – selling the same thing everyone else is selling, you need to make sure that whatever you are selling has some glaring point of differentiation or GPOD. While this may not be the product itself (think gasoline), it could be the complimentary service or services (think convenience stores that sell gasoline) that set it apart. If you are in the service business, the personal interaction is part of the offering – what is it that makes it unique.
- Make it profitable: There is no glory in operating at a loss. If you are manufacturing your own goods or providing your own service to your clients, you still need to think in terms of what the opportunity cost of your time is, i.e., what else you could be doing at the same time (business development, for example!). So, if your company is operating at full capacity and you have to operate a machine or provide services as the business owner, you are probably not operating profitably.
- Who you are serving: The concept of a customer is a person or company who can and will purchase goods and services from you at an established price. Not everyone who darkens your door will be your customer. Being clear on who they are, how they purchase and what they want (and what you are willing to provide) help to clarify this. Are there exceptions to the rule? Absolutely! Do you compromise your company to serve customers that are clearly outside of your target? Never!
- Narrow it down: As company founders, many times, the business takes on our personalities. If we are very aggressive, the company tends to be that way. If you pay attention to this, and the types of people you gravitate to, you will find that there are companies that embody the complimentary personality that you are drawn to.
- Listen to your customers: Your customers are going to be the best beat of who your target audience is. As younger companies, we tend to take (and keep!) customers that aren’t the very best for us. At the same time, we have customers that we love. Learn from both of these: what kinds of products, services and support can you offer (or stay away from!) to enhance your offerings while remaining profitable. At the same time, know what your boundaries are so that you do not end up serving more of the types of customer that you are having difficulty with.
- Holistic Marketing: Do not make your offering come down to just pricing. Even Wal-Mart doesn’t focus solely on pricing. They look at location, product selection and customer buying habits as part of their strategy. Know that you cannot serve everyone. Create a clear value set (4P’s of marketing)– pricing, product, promotion & placement – for your ideal customer.
- Be known: Your target market is probably a relatively small subset of the entire group of people or companies you could serve. This group should be manageable for your size of business. If you know your group, you should know the best way to reach them. Stay in front of them – top of mind – breed familiarity with them. If the group is still to large for your to manage, find ways to break them down even more into manageable subgroups and pursue them.
If you evaluate your offerings and make your way through this process and make the necessary adjustments in your offering to identify with your audience, you will find that your business development activities are much more successful. You will find that you are “appropriately dressed for the right party,” versus trying to be everything to every one. As Bill Cosby once said, “I don’t know the key to success, but the key to failure is trying to please everybody.” Rather, focus on being extraordinary to those in your target audience.
Aepiphanni Business Consulting: The Business Strategy People is an Atlanta, Georgia based Operations Management and Business Strategy Consulting Firm dedicated to serving the needs of small to medium sized business leaders. We help business leaders DESIGN| CREATE | BUILD extraordinary businesses. We support our clients with financial management, product and service production and delivery, outsourced services management, sales & marketing and business growth. We provide them with a number of flexible solutions to help them reach their goals.
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