Can Social Media Really Help In Customer Acquisition?

SOCIAL MEDIA MARKETING

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As almost everyone knows, use of social media in marketing has been growing. Billions are using social media.

Content is key

Social media practitioners all know that content is important.  In fact, it is crucial.

Some may argue that search engine optimization (SEO) is more important. Maybe.

But content with the most relevant keywords is among the good SEO practices.  I know this from actual experience.

Understanding marketing fundamentals

Good content, however, flows out of a thorough understanding of your target market and your market environment.  Knowing these marketing fundamentals is a prerequisite to generating useful information that make for good content:

  • Your target market – their needs, preferences, behavior
  • Your market size, potential, trend, risks and opportunities
  • Your competition
  • Your competitive advantage
  • Your marketing objectives
  • Your marketing strategy and implementation plan

Who is your target market? What is their profile? What are their preferences insofar as the product or service you are offering is concerned and why? How and where are they buying these?  Studies have shown that brands with social media presence are perceived to be more credible and are patronized more.

How about your competition – where and how do they promote their brand? Do they rank higher in search results? If so, what are they doing correctly that you are not aware of?

How do you highlight your competitive advantage. Your target audience should be aware of this so they have a reason to patronize your brand.

What are your marketing objectives?  How do you intend to attain these?  What are the action steps that you have to take?

A thorough understanding of these marketing fundamentals will put you into proper perspective when crafting your social media marketing strategy and campaign.

A solid combination of marketing fundamentals and good content will result in an effective social media campaign.  You facilitate more meaningful audience engagements.  You convert more visitors into high potential leads.  You develop more buying customers.

I say social media remains one of the effective tools in online customer acquisition.

Check out our business services for more options.

Can A Small Business Succeed Without A Marketing Plan?

MARKETING PLAN

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Some entrepreneurs have said that if you have a good product or a fantastic service, you don’t need a marketing plan as the product or service will sell for itself.  Fine. Eventually, they would find out that this is not the case.  All businesses need a marketing plan to ensure that they have studied well their target market and that their product or service will get to be known, used, and patronized by their customers. This is the reason why small business owners should at the onset prepare a good marketing plan.

How does a marketing plan differ from a marketing strategy?

A marketing plan can be simply defined as the tactics and activities a business will implement usually within a period of one year in support of its marketing strategy.

A marketing strategy defines what a business would do to achieve its marketing objectives.  It is the result of a careful analysis and study of its market, customers, competition, internal and external environment, and the business value proposition.

Simply put,  the marketing strategy is what a business wants to do to attain its marketing objectives while the marketing plan outlines how to do it.

A good marketing plan and its correct execution contribute largely to business survival and success. As others may say, a good marketing plan that has been poorly implemented is still a bad one.

Why is the marketing mix important?

Aside from the other essential components, a marketing plan also shows the tactical combination of the different elements of the marketing mix. The marketing mix traditionally includes the product, pricing, promotions, and distribution functions of a business.

The marketing plan tells what product (or service) a company should offer that will satisfy the needs of its target market as determined in its market research including adaptations and variations to suit various customers’ preferences and buying behavior.

The pricing policy directly affects how the business can penetrate its target market and if it will make a profit or not.  Too high a price makes market entry more difficult while too low a price results in possible losses.

Promotions enable a business to create market awareness and stimulate interest in its product/service.  It includes offline and online advertising like paid ads online and on traditional print and broadcast media.  It also covers promotional activities via non-traditional media like OOH ads as well as  point-of-sales promotions, exhibits, events, and ground activation initiatives.

Bringing the product/service to where the customers are involves efficient distribution including logistics management particularly for physical products.  For consumer goods, it may be delivered direct to the customers like purchases via online stores or it may be distributed through trade channels like retail outlets.  Services are rendered directly to customers, or in the case of software or apps are downloaded via the internet.

The elements of the marketing mix are functional areas that a small business should really work at to improve chances of survival and success.

Can a good marketing plan guarantee business success?

Even a good marketing plan cannot guarantee 100% the success of a business.  A marketing plan that clearly shows the following creates a higher success rate:

  1. A thorough analysis and study of the market;
  2. A good product adaptation to the actual needs of the market;
  3. A good knowledge of competition;
  4. A productive and repeatable customer acquisition process;
  5. A skilled and passionate management team.

Of course there are other success factors that you can add.  Timing, connections, luck – maybe.  But lack of a marketing plan, more often than not, will lead to business difficulties or failure.

Some small business owners would need the help of  external marketing practitioner/consultant to craft a good marketing plan.  We can be of help.

What Investors Are Looking For In A Startup

STARTUP INVESTING

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I often come across some would-be entrepreneurs who request that a business plan be prepared with accompanying pitch deck for prospective investors.  Preparing a business plan with this intended purpose can be extraordinarily challenging when a client-proponent had only an idea and a few research notes about the startup.  It will be difficult for them to find investors (outside of family members or close friends) who would be genuinely interested in this startup even though how comprehensive and aesthetically pleasing the business plan is.

Most investors (angels or VCs) have almost common strategies and criteria that they follow when considering a startup for investment.  Some remarkable ones are the following:

1)  Product-Market fit

Essentially the product or service should solve existing problems or relieve pain points for a large number of people or businesses.  The needs to be filled should be real.

Investors would like to see some customers who had tried the solution being developed or offered by the startup.  It is important to have unattached and unbiased prospective clients who had used the product or service and subsequently gave an objective, honest, and impartial feedback whether it has effectively addressed their needs or problems.

The startup should take into serious consideration the various feedback and factor these in redesigning, reformulating, revising, or changing significantly the product or service being offered.  This process should be iterated until such time the startup shall have established a good fit between the product/service and its target market.

2)  Customer acquisition

Once a good fit has been established, the startup can focus its resources on acquiring customers.  Getting the first few satisfied customers (20 to 30) is crucial.  These initial customers can give the startup continuing feedback about the product/service.  Did it actually fill the needs, did it solve their problems, did it deliver the promised benefits? Most important, are the early users willing to continue using the product/service or recommend it to others?

With a favorable feedback from these early users, the startup can firm up its go-to-market strategy and marketing plan.  The marketing initiatives should capitalize on testimonials by the early users and allot the bulk of resources to marketing.  Investors look favorably at a startup which can develop a customer acquisition process that effectively brings in within a reasonable time frame (within one to two years) the number of customers that can generate a recurring revenue at a level that will sustain a profitable operation.

3)  Scalability

There should exist a real possibility for huge growth.  The startup should generate market traction and scale up rapidly without necessarily increasing expenses.  Some investors would like to see sales increasing at least ten times more over the next three years.

4)  Management team

The startup should have a strong and passionate management team.  Members are expected to have experience in business management.  Investors would even welcome a team member or the founder who had been with a failed startup before. Experience is a good teacher and would hold back an entrepreneur from committing the same costly mistakes in business.

5)  Knowledge of competition

The startup should have something different and unique that can protect it from strong competition, or something that cannot be duplicated by competitors.  This something should convince investors that the startup is way above competition.

 

There are other investor-specific criteria but those mentioned above are not only used by many but I also find these more crucial to the success of the startup and in alignment with investors’ interest.  We can prepare the appropriate business plan for presentation to your prospective investors.

 

Social Media Marketing: How Small Businesses Profit From It

SOCIAL MEDIA MARKETING

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Social media marketing uses social media platforms such as Facebook, Twitter, LinkedIn, Google+, Instagram, Pinterest, and others to attract attention, create interest, or develop a community of followers for individuals and organizations.  For small businesses, social media marketing has become a cost-effective marketing tool that significantly boost sales and improve profits.

Some benefits from social media marketing

  • Promote products and services
  • Create/Sustain brand awareness and reputation
  • Build organic reach
  • Generate leads
  • Nurture a community of loyal followers
  • Engage potential customers
  • Promote thought leadership

How to use social media marketing effectively

To reap the benefits cited above and more, small businessmen should learn and diligently work on proven practices that render social media marketing an effective marketing tool.

Know your target market well

At the core of social media marketing are the basic elements of marketing – knowing your target market segment, their needs, their demographic profile, their preferences, their buying behavior.

Determine what contents would be valuable to them

Based on what you know about your target clients, think of contents – articles, images, or videos – that would likely get their attention and interest.  These contents must be deemed valuable and useful to your target market so they will read and follow regularly your social media posts.  Do not post pushy sales pitch.

Draw up a content strategy

You have to come up not only with useful and engaging contents but you also have to organize publishing these contents in such a way as to present a logical series of topics that are posted in a regular manner and time in appropriate social media platforms.

Interact with your audience

Readers may like, comment, or share your posts.  You also have to respond to them accordingly and in a timely manner.  Thank them for liking your posts. You also thank them for their comments and answer their questions or clarify some points they raise.

Your social media posts serve also as listening posts where you can monitor, listen, and engage with your readers and followers. You can feel the pulse of your existing and potential clients – get feedback, suggestions, and act on complaints.

Connect with influencers

Some people are considered or reputed to be authorities in your particular industry.  Find out who they are and try connecting with them. Like, share, or comment on their posts.  You can also follow their followers. Getting to know these influencers can eventually lead to establishing links and relationship that will be good for your business.

Use social media together with other online initiatives

For synergistic online presence, use social media together with blogs and website contents.  Social media is commonly and effectively used to drive traffic to your blogs and landing pages.  While you use SEO to improve ranking in organic search, social media posts can direct your readers directly to specific blog contents or web contents about your product or service.

On the other hand, compelling and engaging blog and web page contents can build a wider and more loyal social media following.

Monitor result of social media campaigns

Social media platforms have analytics or data compiled to show you how your posts are doing.  These include views, impressions, likes, reach, followers, and others.  From these data, you can gauge how well your posts are doing especially in terms of audience engagement and response.  You may need to implement some changes in targeting, posting tactics, or content strategy.

Social media is an effective marketing tool

A well planned and clear social media marketing strategy that is properly implemented is a potent tool that will help small businessmen achieve their marketing objectives.

Social media marketing is a long term investment.  It takes time – weeks, months, or even years – before you reap its full benefits.  But persistence and the longer time you spend engaging and developing relationship with your potential clients, the more conversion or sales you generate.

Our company helps businessmen use social media as an effective marketing tool.

 

 

 

Why Write A Business Plan

BUSINESS PLAN

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Entrepreneurs who wrote business plans performed a lot better than many of those who did not. Why?  Putting your business ideas on paper and being able to review and improve it subsequently, a more structured and organized way of starting your business, inviting investors, and securing funding are just a few of the compelling reasons why you have to write one. Well, some successful entrepreneurs did not write business plans but you have a better chance of success if you have one written.

Business feasibility assessment

When you put your business ideas in writing you can go back to it to review your concept and business model, evaluate your options, or assess whether your proposed business will really be feasible.  Doing these from mental notes would be difficult as you will tend to forget important facts or ideas.  Sometimes it will be downright hazy.

A written business plan can be comprehensive, containing all relevant and critical details about your enterprise.  It is your road map to a successful business three to five years from your starting point.  In the market analysis part of it, you have to list down important data gathered from your research about your industry, market, and competition.  You also have to list down your marketing strategies and tactics as well as details of your implementation plan.  You have to show some projections of your sales, expenses, and expected profit under different business scenarios.

Related article:  WHAT YOU HAVE TO KNOW ABOUT BUSINESS PLANS

Inviting investors

One of the more important reasons why you have to write a business plan is the need to present one to potential investors or sometimes strategic partners.  More than the projected sales and profit, prospective investors would be keen on knowing how well you have studied your target market, how potential customers would accept your product or service, and what sort of management team you will organize.  Some investors or partners would like to see also a statement of your business philosophy and corporate mission.

Securing funding

You may have secured commitment already from investors but you may need additional funding through banks and financing institutions.  You need to prove to them in writing that your business is feasible and it can actually generate revenues and cash flow that can assure them that you can pay back your loans.

Future reviews

After you shall have started and operated your business, you will periodically review its performance.  Have you successfully followed and implemented the business model you had conceived earlier?  Have you explored fully the potential of the market you had studied?  Are your customers buying your product or service?  Are sales and expenses as per your financial projections?  If not, you can always go back to your business plan, which is your blueprint in building your business, and see what adjustments are needed.  For one, the marketing strategy and sales plan will require periodic review and re-alignment with the current realities of the market.

Who should write your business plan

You should write your business plan – ideally.  But if you cannot do so for some reasons like not knowing how to prepare it, or not having time to do it, or simply not having the  knack for putting down things in writing, then have a professional with a demonstrable experience in writing a business plan and, more importantly, a significant experience and starting and running a business do it for you.  These professionals may cost a little bit more than ordinary business plan writers or a software but it is your business’ roll-out success which is at stake here.

Whoever writes your business plan, you should be the one providing the essential facts and figures, offering unique insights, and doing all the actions behind the business plan.

A business plan cannot guarantee success of your business.  But it can lessen your chances of failure.

Our company has the experience and expertise in writing business plans.  We certainly welcome your inquiries on how we can help you.

Marketing Plan: Key To Success For Small Businesses

MARKETING PLAN

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You depend on your small business for a living.  So you want it to make a profit.  To earn profit, you should sell your product or service.  This means you should have a customer, a market.  You must convince your target market that you are the better choice than your competitors.  This entails crafting appropriate strategies aimed at generating sales and/or getting a respectable market share.  You have to execute these strategies through tactics or action plans.  You need a marketing plan.

What is a marketing plan?

A marketing plan is a written outline of your marketing activities that span a period of at least one year.  It essentially shows what your marketing objectives are, what strategies you will employ to attain those objectives, how you will use the elements of the marketing mix – product, price, distribution, promotions – to implement your strategies through action-laden tactics. Your marketing plan includes also the detailed implementation plan, a contingency plan, and the conclusion.

Why is it important?

The marketing plan embodies in writing what you have thought about, brainstormed, planned, and agreed to do regarding your marketing activities. It is the blueprint you constantly refer to while building your business through systematic marketing efforts. If you have people working for you, it serves as their central reference as you generate sales and gain market share. As the business owner, it encapsulates your idea on how you will successfully tap your market amidst tough competition and external threats using whatever inherent strengths you have and taking advantage of existing opportunities.

How do you prepare a marketing plan?

Marketing plans come in different lengths and contents.  Basically, it should have the following:

  • Executive summary – an overview of the whole marketing plan; briefly highlighting key elements, findings, and recommendations; usually prepared last
  • Introduction – brief summary of market research findings and analyses regarding the target market, consumer profiles, competition, internal and external environment
  • Marketing objectives – SMART objectives you want to attain such as total sales revenue, unit sales, market coverage, market share
  • Marketing strategy – this is the foundation of your marketing plan as it outlines the details as to how you will attain your objectives using strategies and tactics for each of the marketing mix element
  • Implementation plan – timeline showing the sequence of specific activities, tasks, responsibilities, and deliverable based on the various strategies and tactics
  • Contingency plan – the “what if’s” portion, what you intend to do in case of potential threats from competitors or uncontrollable external events
  • Conclusion – strengthen your stand about the plan implementation
  • Appendix – various data and numerical presentations used in the plan

You can always customize your marketing plan depending on your product or service, the type of business you are in, your marketing objectives and strategies, and your purpose.

For the success of your small business, create a written marketing plan, execute the planned activities, and measure and review results.  Revise some portions if necessary and keep it attuned to your market and business.

Personality: Its Significance In Personnel Recruitment and Training

EMPLOYEE PERSONALITY

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Personality impacts on recruitment and training

Personality is an important consideration when you recruit and select the right candidate from among numerous job applicants.  There are divergent views, however, when it comes to its significance in the conduct of training of both newly hired and old employees including managers and small business owners.

Personnel recruitment

In the previous blog, I discussed the recruitment and selection process.  I mentioned that the hiring decision is based on several factors.   I selected the key factors, namely:  attitude, values, motivation, and skills.

I mentioned that some companies would give personality tests for a more scientific evaluation of an applicant’s attitude and inter-personal skills.  You have to assess test results on the basis of specific job requirements.

Usually, when you try to understand an applicant’s personality, you are actually trying to get a clear profile of his/her unique strengths, weaknesses, and values.  Your underlying reason for this is to determine the probable behavior that will be exhibited by the employee-to-be under the working environment  and culture of your company.

There is obviously a wrong hire should the probable or expected behavior seems to clearly run counter to your corporate culture.

On-the-job training

To properly prepare the new-hire for the correct performance of his/her job, you and/or the concerned department will give orientation and training.

You normally follow a manual on “how-to’s” when you conduct the training.  The systems, procedures, and process are all there.

You may say that if the new-hire correctly follows the manual and instructions given, he/she CAN perform the job well.

But what cannot be predicted at the onset is WILL he/she perform the job well.  The new-hire can perform the job technically alright but the question that may pop up later is will he/she perform it in a manner as expected by people in his/her organization. The issue then will revolve around attitude, behavior, and motivation.

While others may say that personality does not directly affect an employee’s job performance, I believe, based on personal experience, that it significantly affects an employee’s effectiveness in the organization.

If a new-hire’s interests, talents, character strengths, and potential can be determined upfront, the one in-charge of training can predict the attitude, behavior, and motivation of the new-hire.

How the new-hire will relate to others or respond to stress are important to be known beforehand. What personal beliefs or values the new-hire will lean on during challenging situations or what latent talents he/she can use have profound effect on job performance.

Personality assessment

It is therefore compelling for the recruitment staff and the workplace superior to have a clear assessment of the new-hire’s personality.  A correct personality assessment can preclude recruiting the wrong candidate and make training more effective – technically and psychologically.

HR practitioners can avail online appropriate personality tests, many of them free or offered at affordable rates.  Comprehensive and scientifically validated personality assessments for employee training and development will result in better quality of employees.

Personnel Recruitment: A Challenge For Philippine Small Businesses

PERSONNEL RECRUITMENT SELECTION

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Personnel recruitment scenario

I have seen it frequently happening in small businesses in the Philippines. The company would put out recruitment ads online and offline; applicants would respond; the selected applicants would come, or occasionally would not come; those who would come and get interviewed would either pass or fail the interview; those who passed would in several cases stay only for a month or even less.  Whew! It was a costly exercise in futility.

You as the business owner or as the human resources manager surely finds this personnel recruitment and selection situation very disappointing.

You can avoid a similar situation by first being clear about your objectives in recruiting and selecting personnel and, secondly, by following a pretty common but sensible process.

Recruitment and selection objectives

You can easily determine your objectives from the definition of personnel recruitment and selection.  It is the identification, evaluation, and hiring of qualified job applicants through a systematic process.  Thus, your objectives can be as follows:

  • To attract and identify a good number of applicants;
  • To evaluate applicants’ suitability to the needs and values of your company;
  • To hire the most qualified applicants

Recruitment and selection process

To achieve these objectives, you go through a process which can vary from one company to another.  Your process may be something like this:

  1. Obtain an approved personnel requisition together with an updated job description;
  2. Place job postings and ads based on the job description;
  3. Form and brief a search committee or an interview panel;
  4. Make an initial evaluation and selection based on responses to job postings and ads;
  5. Interview priority applicants;
  6. Draw up a shortlist of applicants;
  7. Give written exams to the shortlisted applicants;
  8. Conduct reference and/or background check;
  9. Make a hiring decision;
  10. Make an offer to the selected candidate;
  11. Prepare employment documents;
  12. Conduct new employee orientation;
  13. Introduce new employee to the organization.

Crucial part:  the interview

Based on experience, I consider the interview as the most crucial part of the process. Here, face to face, you can find out more about a prospective employee.

To make the most out of the interview and to establish a uniform basis of response evaluation and to provide more reliable results, you can prepare a standard structure of questions generally focused on the applicant’s critical skills, attitude, and behavior.  Remember that how you phrase questions affects the applicant’s response. Special questions may be included to get critical info from the applicant, or simply to add fun or lightness to the interview session.

However, I believe that a rigid approach to an interview session may in some cases result in a failure to get the best out of an applicant, or even turn away a highly qualified applicant.

During the interview, I would normally sell the company first as this is a good way to make the applicant really aspire to work for the company – the vision, mission, corporate values, culture, and what make the employees happy and contented in their jobs.

The only major question I have for the applicant is “how he/she would fit into this ideal corporate microcosm”;  from there, I follow it through with questions seeking clarification or some mind-stimulating, not interrogating, questions and/or remarks.

You correlate the response with the needs and culture of your company. Assess the applicant’s potential of success and predict his/her job performance if hired.

You may find it also helpful if applicants are treated with sincere courtesy and accorded due importance from the time they arrive at your office until they leave.  As probable future employees of the company, accommodating them well and being prompt in attending to them will surely strike a positive note.  They will not hesitate to be part of this kind of corporate environment.

Making a hiring decision

What should be the considerations in making your hiring decision?  I have always believed in the following factors – in order of priority:

  1. Attitude
  2. Values
  3. Motivation
  4. Skills

Some companies would give personality tests for a more scientific evaluation of an applicant’s attitude and inter-personal skills.  Others would also give ability tests and ask for work samples to determine if applicant’s specific skills fit the job requirements.

Companies may follow a more simple or a more rigorous process but the objectives would always be almost similar.

Your personnel recruitment and selection exercise should provide your company with the most qualified personnel – in terms of attitude and competence – at the right time and within your other recruitment constraints.  Failure to do so would result in loss of productivity, higher operating costs, and high personnel turn-over.

Welcome to your new employees!

 


RECOMMENDED LINK:  http://www.linkedin.com/pulse/want-hire-great-people-stop-asking-stupid-interview-questions-ryan

 

 

 

 

Training and Services for Small Business Owners

Recent business management consultancy engagements with my clients have made me focus on providing specific training programs and business services for micro, small, and medium enterprises (MSME’s) starting in July 2015.

PERSONNEL TRAINING

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These training programs are designed to empower you – the small business owner –  and your people to deliver the performance and results that you want  for an organized, efficient, productive,  and profitable business.

The business services are intended to help you (or potential entrepreneurs) to plan and to operate your business at a level that is more proficient, contemporary, and forward-looking.

For a FREE business management advice and guidance, please submit the form at the end of this post.

Training programs

The training programs currently include the following:

  • Leadership
  • Problem solving
  • Work process
  • Sales pipeline management
  • Customer relationship management (CRM)
BUSINESS SKILLS

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You may be operating your business already but sometimes think you still need a clear direction or you would like to re-define your short- and long-term goals, the workable action plans to achieve those goals, and the appropriate resources needed to implement those plans.

You need a strategic plan.

Maybe you are having difficulty competing in your market place simply because as you have eventually realized that you have been tapping a loosely defined market, you do not know your inherent competitive advantage, nor you know enough about your competitors.  You may have been competing  on the basis of price alone which is not good in the long-run.

You need  a marketing strategy.

Or, you may have simply hired salespeople, gave them the sales literature and price list, and told them to sell the products/services expecting that sales revenues would start coming in.

But without good marketing and sales plans as well as organized monitoring, sales would not come in as you have expected and your operations would be costly and unproductive.

 Business services

The business services currently provided are as follows:

  • Business plans
  • Marketing strategies
  • Marketing plans
  • Market studies
  • Market research
  • Strategic plans
  • Competitor analysis
business services

Image credit: Pixabay

As an aspiring entrepreneur or business owner you may be equipped alright with excellent business concept.  But before jumping in and committing your hard earned money into that business venture, you need to have a clear idea how to go about it, your target market, the strategy you will implement, your management team or how you will manage it, the technical and production feasibility of your product (if you are marketing a product), how and where to get additional financing for your business, and most importantly whether or not  you will make money in this business.

You need, therefore, a professionally done business plan especially if you are to convince or pitch to prospective partners, investors, and/or financiers.

As a new or existing business owner, you  would like to enter into new markets.

It might be very costly or it is bound to fail if you do not have a market study that can give you critical information and insights on the characteristics, size, potential, and trend on the new market, the competition, and the environment prevailing in the new market.

Many entrepreneurs are now using or intending to use online or internet marketing for their business.

I am sure you would also like to go into online marketing.

The reach, cost-effectiveness, and success of online marketing have amazed many small business owners.  While this perception is generally correct,  there are always exceptions. Some have failed or have been disappointed with results of their online marketing initiatives.

To succeed in online marketing, you have to learn and apply the correct concepts and techniques.

Like the many online marketers who have succeeded, you have to spend time and resources in doing it properly and with some help from people who know online marketing.

The small business owners like you will go a long way learning from these training programs and availing of these professional business services.

For a FREE business management advice and direction, please submit the information below.

 

 

 

How a Small Business Should Define Its Target Market

I welcome all small business owners (and would-be entrepreneurs) to my new series of posts under the category SMALL BUSINESS BOARD.  I am publishing here interesting business tips, contents, materials, and links you may find useful in planning, managing, and expanding your business.


 

What is a target market?

A target market is a specific group of end-users or consumers,  whom you believe will need your product/service, and to whom you will direct all your marketing activities.

 

Flickr.com/Darts by Bogdan Suditu/Creative Commons/CC-BY-2.0

Flickr.com/Darts by Bogdan Suditu/Creative Commons/CC-BY-2.0

 

How do you define your target market?

1)  Analyze your product/service.  What are its features?  What benefits are derived from its features or from using your product/service?  Identify the people who will likely need those benefits.  

2)  Group together these people according to the following criteria:

  • Gender, age, household size, location, occupation,  income, education
  • Personality, attitudes, values, lifestyle, interests, hobbies
  • Or some other criteria like behavior or common needs

Now you have a target market.  But look again.

What is the estimated number of potential buyers in your target market?  Is it big enough to make your business viable?

Will your prospective buyers really need your product/service?  What will motivate them to use your product/service?

How much are they willing to pay for your product/service?

How do you reach your target market?

You can only answer the above questions if you do a market research.  Make a survey of your potential users/consumers.  Try doing some face-to-face interviews.

If the responses you get are favorable and point toward a viable business, then you have clearly defined a solid target market.

 

How important is it to have a clearly defined target market?

A clear target market will enable you to focus.

You can concentrate your limited resources and marketing efforts at a well-defined target market.  This makes your small business more cost-effective as you avoid wasting time, money, and effort.

You can then create and develop your own niche market which is not served or underserved by your competitors.  Eventually, you can adapt your product features to more specific needs and wants of your target market.   You can successfully compete with bigger businesses by targeting a niche market.

 

 


You may contact me for any problem or concern about starting or improving your business.  I will respond to you (free-of-charge, of course) the best way I can as a management consultant dedicated to helping small businesses.


 

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