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How Do Organizations Select a Target Market?


A target market is a term used to describe a specific group of individuals, companies, households, or organizations with shared characteristics towards which a company markets its products and services. The target market can, in turn, be further broken down into subdivisions known as niches or segments.

Businesses and organizations use target marketing to clearly understand potential customers interested in purchasing their merchandise. This helps companies craft compelling marketing campaigns and strategies that get through to their customer base. This way, they can focus on consumers who are more likely to associate with them instead of wasting time, effort, and resources by directing their marketing efforts toward anyone and everyone.

Determining the target market is integral for all sorts of businesses, big or small. It is key to attracting and acquiring new clients, expanding into new markets, and increasing sales and revenue, and it can lead to successful market growth. 

Systems/processes used to identify a target market 

Identifying a target audience can take time and effort. With Kettering University’s online Master of Business Administration program, you will gain a thorough understanding of different markets, sharpen your business acumen, and open doors to a wide range of management opportunities across numerous industries.

Here are some strategies most organizations use to select their target market:

Analyzing product/services

Most companies analyze the features of their offering to determine the benefits their clients can seek from their products and how their products cater to the needs and demands of those customers. For instance, a landscaping business usually targets adults with higher incomes and children or demanding jobs as these individuals typically have no time to spare on yardwork but have the means to pay someone to do it for them.

Assessing the competition

Keeping an eye on their competitors also helps businesses select a target market. By observing rivals’ social media, marketing materials, and websites, they can learn about who their competitors are targeting, what strategies they are implementing, and what customer base they serve. This can significantly benefit them and help them identify the markets that their competition has overlooked. In this way, instead of targeting the same market as their competitors, businesses tend to go after markets that aren’t working for their rivals or ones they’ve failed to identify. Furthermore, they can get an idea of how they can make improvements to increase revenue and the market share of their brand.

Leveraging the current customer base

Companies typically analyze the data from their existing customers to determine their target market and learn more about what type of consumers they are marketing to – their profession, age, gender, lifestyle, previous purchases, interests, etc. The more data they are able to acquire, the easier it is for them to select their target market and hone their campaigns and strategies accordingly.

Conducting research on the industry’s target markets

Organizations also tend to look within their industry or sector for insights into their target market. This is typically accomplished by going through reports, statistics, publications, market reports, and other data that help them narrow down potential customers. 

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