For any business or a company worldwide, a target market is a group of consumers or organizations most likely to buy its products or services. Since these people would be the most interested in what the company has to offer, so it makes the most sense for the company to focus its marketing efforts on reaching them. However, it is not an easy task. Identifying the target market alone is a big task in itself.
What Is Target Market?
Target Market is defined as a set of customers that a firm or company has decided to aim at for marketing and selling its merchandise with full efforts. The target market can be the initial element of any marketing strategy if it is well-defined. The elements of the marketing mix that are Product, Place, Price and lastly Promotion are the four variables that decide upon a product's success within the market place. In this marketing mix, one of the Ps that is product needs to be addressed to the target market for making it successful.
What Are The Target Market Strategies?
The selection of the target market requires
Mass marketing, also known as undifferentiated marketing, is an attempt to appeal to an entire market with one basic marketing strategy utilizing mass distribution and mass media. This type of marketing strategy is not aimed at anyone in particular. It is open to everyone who is interested and willing to listen to what the marketers have got to say. The most common mass-marketing channels include:
- national television
- social media
One of the best examples of mass marketing is FMCG products like soap and detergents as they are used by a huge market segment.
Unlike mass marketing, a differentiated marketing strategy takes into account at least two segments of the target market. In this strategy, a company creates campaigns that appeal to at least two market segments or target groups. To understand this concept better, let us have a look at an example:
- For instance, a company that manufactures running shoes, when practising differentiated marketing, may offer two versions of their products. Customers with a concern about the impact may opt for running shoes with less cushioning, and the others who are only worried about the speed may opt for shoes with less cushioning. Here two segments are targeted in a particular way or on the basis of customer needs, to be precise.
- Another example can be that of an apparel store that targets women in at least two age groups.
The sole aim of differentiated marketing or multisegment marketing is to boost the sales and market share of business across each segment it targets.
Whenever a company takes up the responsibility of listening to such consumer issues that have long been left unattended by other firms and decides to resolve them, it creates a niche. The company concentrates all its marketing efforts on this well-defined segment of the population. This strategy can help you become an expert and attract more profitable customers to your business. For instance, the manufacturer of Rolex watches has chosen to concentrate only on the luxury segment of the watch market rather than catering to every segment.
An extended version of niche marketing can be called as micromarketing. In this strategy, a business caters to the needs of individuals or tiny segments in a targeted geography. It can be said that micromarketing follows the concept of customer-centricity so that every customer can get exactly what he/she needs and whenever it is required. The best example of this marketing strategy is Proctor and Gamble. The company underwent a marketing campaign. This campaign targeted African-American women for the launching of Pantene Relaxed & Natural shampoo and conditioner product line and was a huge success.
These were the top marketing strategies that businesses around the globe employ to boost their sales and customer satisfaction rates.
What Factors Are Important In Selecting A Target Market?
Selection of the target market is a crucial process. That's because a business is required to consider a lot of factors in order to decide what segments of the market it should focus on making maximum profit. Here's a list of the top factors that are considered:
The very first factor that affects the selection of the target market is "segment size" in terms of unit and revenue sales.
Every business gets its share of competition. Even if you start a business that's one of its kind, if it's a hit, you risk a competitor entering the same marketplace to try to make the most from the lucrative market.
Next comes the data regarding the age, gender, location, preferences and other such elements related to your target audience. Figuring out who requires your product or service and who would be interested in buying them is crucial when deciding your target market.
Knowing what products your target customers would use in the absence of your product. These products or substitutes could threaten the profitability of your business, especially if they are sold at a lower price.
Lastly, figure out how easy it would be to gain access to the appropriate distribution channels.
So, these are the factors that affect the selection of the target market.
Examples of Target Markets
Example 1: Target Market Of McDonald's
Highly loved fast food chain, McDonald's targets students, employees, and professionals in the age group of 8 to 45 years. Their target audience mostly belongs to low & middle-income groups.
Example 2: Food And Apparel Stores
Health food stores selling gluten-free products often target people with food allergies. Similarly, boat and swimwear retailers focus on potential customers who tend to enjoy spending their leisure time in the water.
What Is Target Audience Analysis And Why Do We Need It?
As a matter of fact, the marketing budget for every business has a limit. Moreover, the target audience for any business may consist of a lot of groups that may or may not visit the same websites, have the same issues, use the same social network channels and so on. That's where target audience analysis steps in and helps make the most out of the marketing efforts. Here's a list of benefits that target audience analysis brings:
- Helps filter your target audience and find customers who are most likely to convert.
- Enables you to know the real issues of your customers, solve them efficiently and develop stronger relationships.
- Helps target a specific niche and establish you as an expert.
- Enables you to improve your content marketing strategy.
All of these benefits eventually result in boosted conversions and profits.
What Is The Difference Between Target Market And Target Audience?
The term "target market" refers to a well-defined segment of consumers that a business plans to target with its products, services and marketing activities. The target market can be the initial element of any marketing strategy if it is well-defined. On the other hand, the term "target audience" refers specifically to the group of consumers targeted by advertisements (through television shows, movies, and music products).
Let us understand the difference between the two terms with the help of an example. For instance, a company's target market might be "rollerskating lovers age 15 to 30," whereas the target audience for one of its ads may be "roller skaters age 15 to 30 living in Denver, Colorado."
So, that's all you need to know about the target market to get an idea of this concept. However, that's not enough in the case of marketing students pursuing a higher degree in this discipline. Acquiring top grades in exams and assignment tasks require students to have a fair of knowledge of marketing concepts like these. But are they always able to manage time for all their academic and personal commitments?
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