Finding Your Target Market
Business guru, Peter F. Drucker, often called the father of modern management, once said: “The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.”Although at the time he was working with multi-national corporations like Coca-Cola and General Electric, Mr. Drucker could easily have been speaking about small businesses. The importance of understanding your target market is as relevant to IBM’s marketing strategy as it is for the coffee shop on the corner.
Unfortunately, in my time working with small business owners, I have met very few who truly understand their customers. Most entrepreneurs fall for what I like to call the everyone fallacy.
Business owners are understandably passionate about their product and will often respond to questions about their target market with optimistic expectations that everyone is a potential customer and, therefore, everyone is in their target market. This assertion is missing the point. Just because my 87-year-old Grandmother, who has never seen a football game, might buy a Frank Gore jersey, doesn’t mean you should be spending your time and money convincing her to buy it. You would be better served targeting her 49ers-obssesed grandson.
What separates great marketing from useless spending is a clear image of who your best customer is.
What does your best customer listen to? Read? Enjoy doing on the weekends? Where does your s/he shop, eat, and relax? What are some of his/her fears and aspirations? Understanding your customer at this level allows you to see through his/her eyes and walk in his/her shoes. The best marketing strategies will practically create themselves when you can think like your customer.
I recently met with a baker who specializes in vegan cupcakes. “Everyone loves cupcakes,” Shannon told me. “There is no one else doing what I do, so everyone is a potential customer.” Few products have as narrow a niche market as a $5 vegan cupcake, but the everyone fallacy had struck again. Rather than focusing her efforts on building brand recognition with those most likely to frequent her bakery, Shannon was wasting much of her time trying to sell to individuals who would likely never see the value of her product.
After taking a closer look at her existing customers and doing some research at the Brooklyn Business Library, Shannon had a much better picture of her typical customer: a college educated woman between 25 and 35 years old, who frequents organic grocery stores and farmer’s markets, attends yoga classes, shops at Etsy, and subscribes to Brooklyn Based and other local blogs.
Sure, this is a made up individual, almost a caricature, but this exercise was hugely helpful in planning out a strategy. Think of how differently you would market to this individual than, say, a 45-year-old male who is into muscle cars and baseball. Maybe you could invest in advertising in Brooklyn Based or distribute flyers at the local farmer’s market.
Shannon decided to partner with a yoga studio to host a free tasting and is opening an online store on Etsy. Most importantly, she is putting her product in front of those who will truly appreciate it.
Peter F. Drucker’s advice on understanding your customer is as relevant today as when he originally gave it, more than 60 years ago. Companies he worked with then have remained leaders in their industries thanks to a commitment to exploring every tiny detail about the customers they serve and a dedication to providing a product that “sells itself.”
Manuel Dominguez is the Director of the NYC Business Solutions Centers in Brooklyn. If you have a question or comment for Manny, drop him a note below. And, please share this blog entry with your colleagues on Facebook and Twitter.