Successful business depends on the ability to meet customer needs. All buyers have different tastes and preferences, so it is almost impossible to work with all the potential audience of the market. Of course, it is possible to make a certain universal product that will have average characteristics. That's just it will not like any consumer. Therefore, firms are trying to find "their" customers, that is, the target audience that the company's product will fully satisfy.
Company segment
In marketing, such a concept as the target market is considered key. This concept means an attractive market area where the company operates in order to fully realize all marketing opportunities and attract more buyers.
Marketing approaches help identify target markets. They are massive and concentrated, but in each of them it is necessary to determine specificsegments and understand how to position your product. According to statistics, representatives of the target market are more interested in buying and using the product of a certain company than other buyers. This kind of increased interest greatly simplifies the work, but most importantly, it helps to understand the basic needs of buyers in this market share.
Purpose
If a firm understands to whom it sells a product and who will most often buy it, then it doesn't cost anything to create the right advertising that will have a high response. Also, understanding such details contributes to the creation of the right packaging, endows the product with the qualities it needs and determines its place in the sales department.
For a deeper understanding of the essence of this phenomenon, it is worth giving a small example. Let's say a company manufactures and sells toothpaste. If its target audience is young office workers (25-35 years old), then it is important to focus on whitening and refreshing effect. Also, this audience will pay attention to the design of the package and statements about the effectiveness of the product (it is better if they are written in “smart” words). But if pensioners are the target audience, then their priority will not be the whitening properties of the paste, but “gum protection” and “delicate care”. Also, older people pay attention to value for money, and in the composition they will look for the names of natural ingredients, and not furious “fashionable” terminology.
Choosing your seat: the first method
When choosing a target market, time-tested and experienced methods will help. For example, you can release a product that can be attractive to each group of buyers. In this case, a mass marketing strategy is applied, or, as it is also called, a big sales strategy. The main goal of this method is to organize maximum sales. This strategy is costly and is usually used by large corporations that can afford it.
Second way
The second method says that you need to focus on a specific market segment. Here, a concentrated marketing strategy is applied, which is aimed at a specific group of consumers. This sales method is attractive when resources are limited.
Enterprises concentrate their efforts and resources where they have obvious advantages over competitors. This allows you to create a stable market position due to the uniqueness of the product and its individuality in meeting user needs. This strategy helps to maximize profit per unit and compete with other businesses.
Third solution
The third method is to select not one, but several segments of target markets for further work. For each segment, the company can produce a separate product, or it can simply supply a variety of it (for example, yogurt for children and adults). This is called a differentiated marketing strategy. Here, for each individual segment, separatemarketing moves. To cover all the selected segments, you need to invest a lot of money and effort, but on the other hand, the release of several products helps to maximize sales.
Having established itself in any one segment, an enterprise can expand its field of activity. After all, it is much easier to do this when the manufacturer is already known to the buyer.
Features of segmentation
It is worth noting that in the process of segmenting the target market, marketers neglect some parts of it. For example, now many products are focused on families or young people, and niches such as "teenagers" and "retirees" have been without new products for a long time. This situation is called a "market window". If the manufacturer wants to close such a window, then it is likely that he will be successful.
After identifying the target market, the company must first study the competitors and their products. Only after concrete conclusions based on statistical information are made, the company can decide on the positioning of its products. That is, to talk about the competitiveness of the product in the market.
Varieties of trading platforms
A study of target markets showed that there are 2 main types of them: primary and secondary. These markets differ in purchase motives and approaches to product selection. In addition, they have their own size, behavioral and psychographic characteristics.
Primary is the main market of the company, which makes a profit. HisRepresentatives are all buyers who have an expressed need to purchase the company's product.
All buyers who:
- May spontaneously buy a product.
- May influence primary marketers' choice of product.
- Will be potential buyers in the future.
Simply put, the secondary market is buyers who have the potential to purchase a firm's product and are more likely to do so.
How to describe the market?
Before planning to capture a segment, it must be described in detail. Only through a detailed analysis of the target market can one understand exactly what the buyer wants and how to please him.
In general, there are four main criteria that help assess whether the target segment is correctly described.
- Target market parameters should be common for this market and different for other buyers.
- There must be a parameter describing the decision to purchase the product.
- The market needs to be combined according to the parameters set by the company.
- The parameters underlying the description of the company's target market should allow for high-quality targeting and planning advertising campaigns.
7 characteristics of the target segment
In general, description characteristics are divided into seven main groups:
- Socio-demographic. Marketers must specify the characteristics of the market in terms of gender, age,income, marital status, occupation, nationality, etc. All these characteristics have a decisive influence on the choice of a communication channel and further planning of advertising campaigns.
- Geographic. Give a clear description of the area that the company plans to serve. This includes items such as country, city, region, population, climate, and target market location.
- Psychographic. These characteristics will help determine the nature of the buyer and his lifestyle. Understanding this process will allow you to choose the right advertising message and the main images for the image of the product. These parameters include the idea of the buyer about himself and how he wants to see himself. For example, here you can describe the person's marital status, their favorite TV shows, leisure preferences, political affiliation, etc.
- Behavioral. They make it possible to understand what methods buyers are guided by when choosing a specific product. This may include information about the reason for the first purchase, the number of purchases in a specific period of time, the speed of decision making, how the product is used, etc.
- Main buying drivers. To assess this characteristic, parameters such as product quality, price, brand, packaging, service, guarantees and the possibility of returning goods are most often used.
- Market size. This information will make sure that the number of potential buyers is really large, and the company will make a profit,releasing a specific product.
- Trends. No target market is a stable substance, it is prone to change, and when choosing marketing methods for promoting products, one must take into account the key trends that affect the development of the market. Here, experts consider such parameters as the level of stability, growth prospects and buying opportunities. These trends must be considered in the spectrum of influence of the economy, politics, market growth rates.
Change positions
Once the marketers have identified the target market and the company has begun to work according to the developed strategy, there may be some difficulties in selling the product. Then the company takes active measures to reposition the product.
Repositioning is a strategic action aimed at changing the existing position of the product in the perception of the buyer. Usually this path consists of several stages:
- Improve price, quality and other consumer characteristics.
- Introducing new criteria for product perception into the minds of potential buyers. A manufacturer that has launched a product in the target market, for example, may begin to focus buyers on naturalness, comfortable use, environmental friendliness, etc.
- The firm can draw attention to features of the product that were previously ignored, such as highlighting a new benefit.
- The company often provides the buyer with a comparativeadvertising, thereby forming an attitude towards competitors.
Reposition Tool
In the process of repositioning a product in the target market, the policy of differentiation plays an important role. These are actions that form the distinctive features of a product relative to similar products of competing firms. At the heart of this process is the search for unique distinctive characteristics of the product. The company can expand the existing characteristics of the product, pay attention to the service life, improve the service, providing services for consultation, repair or replacement of the product.
To put it simply, differentiation in the process of repositioning is about improving the product and all related features.
It's easy to sell a product. It is difficult to form a stable group of buyers who can solve their problems with the help of the product and thereby bring profit to the company. Only in this way can a business turn into a successful enterprise, and not be just another company that barely keeps afloat.
