Small Business: Defining your target market

Every business has that sweet-spot customer, the ideal buyer who needs exactly what they're selling and is likely to buy on a regular basis.

Knowing who that customer is and defining your target market is critical if you want to optimize limited resources and marketing dollars and reach the right audience.

"If you're not clear who your target market is, it's just a guessing game," says Susan Gilbert, a digital marketing strategist in Issaquah, Washington, and author of "Psycho-What?: How to Use Psychographics to Understand and Improve Your Marketing (e-book; $9.95)."

Companies often take a broad-stroke approach and end up wasting a lot of time and resources on the wrong audience.

"Having a target really focuses your effort," to use your time, energy and resources most effectively, explains Siobhan Murphy, executive coach at The Quest Connection, a Bay Shore-based leadership development firm.

THREE KEY SEGMENTS. Look at three key segments to help you identify your target audience, says Gilbert: demographic (ie., age, gender, income, etc.); geographic (where your audience is buying) and psychographic (why your audience is buying, such factors as lifestyle or values, for example).

Psychographics is important because prospects could be the right age and gender, but if the desire or need isn't there, they're not going to buy, says Gilbert, noting "buying is an emotional process."

RESOURCES. You can gather this information in a variety of ways, including through social media, surveys or questionnaires, focus groups and personal interviews, she says.

If you don't have a large budget to do this, consider low- cost tools like SurveyMonkey, says Linda Schenk, owner of Virtuallinda Media LLC, a Baltimore-based brand-design and marketing firm. She has an infographic on understanding your target market at her website, virtuallinda.com.

DIRECT CONTACT. You can also just talk to people to get feedback, she notes.

CURRENT CUSTOMERS. Focus on current customers: Take a look at some of the buyers you have now, the qualities they have that made them say yes, she notes. Once you get that ideal client or customer in your mind, visualize the person so you don't forget him or her, she suggests. Draw a picture with all that person's characteristics and post it where you can see it all the time.

"That way your marketing becomes more specific," says Schenk.

And being more focused and targeted can be a competitive advantage, notes Rich Isaac, president of Sandler Training in Hauppauge, a sales training and consulting firm.

FOUR KEYS. Some businesses go after what they think is their ideal target market to find out later it's really not. They don't take into account what Isaac defines as four key elements: awareness (how aware is your target audience of your types of services); need/size of market (is there a large enough audience); findability (is your target audience easy to find and do you have access to it) and propensity to buy (do they have a tendency to invest in your type of product or service, take a risk or try something new).

Taking into account all these factors is important, says Isaac, noting "when you don't really choose your target markets carefully, then you're not going to be focused."

To be sure, there's a research phase you need to go through, but as part of that you should also consider what you're passionate about to see if perhaps it's an area that's sustainable.

"Following your curiosity is another way at getting at what your target market could be," says Murphy. Ask yourself who would you love to serve.

REVIEW. Then re-evaluate and periodically reassess your target market's needs and passion for what you offer, she says. "Re-evaluation," she adds, "is important."