Hello Marketers
Today I want to talk about targeting specifically target market, one of the most important things in marketing, because without it, you’re just throwing money into the abyss. What you’re aiming for is a specific person—probably a person that’s already thinking about the problem that your product or service solves and making that person your customer. Brands have spent decades learning how to target the right people. We’re here to help you learn what a target market is and some examples from your favourite brands.
What is a Target Market & its importance?
Digital marketing is a lot to take in. There are so many different facets to marketing and advertising that it would be easy to get lost in the weeds.
To put it simply marketers and advertisers use the concept of a target market to make their product or service messaging more appealing to a certain segment that will buy the most of their product. It’s a simple concept, but it’s also very powerful when understood.
Almost every product and service has a target market, so knowing who this market is for your business is crucial. And it’s not only important if you want to make sales, but also for the sake of understanding the needs of your audience and making sure you’re serving their interests.
When starting a business, it’s best to think of your own target market to find out who will most likely want your product or service. In order for your business to grow, you must create a strategy to attract customers, and it is important to understand who they are.
How is a target audience different from a buyer persona?
A target audience is quite different from a buyer’s persona. The target audience is a group of people the company decides to target and the buyer’s persona looks at the person the brand is trying to reach.
A buyer’s persona is used as a way to help get in the mind of certain buyer’s in your target market.
How psychographic and demographic data informs Target Market helping to improve marketing campaigns?
For many brands, marketing is more than just media buying. In order to truly engage users and guide them through the purchasing process, marketers need to start thinking more like researchers and psychologists.
Marketers must keep an eye on the psychographic and demographic data about the user in order to make educated decisions about what to create or promote.
The goal of a successful marketing campaign is threefold: to acquire, to retain, and to convert.
Here are some examples of different types of market segmentation
Examples of Demographic Segmentation:
Demographic grouping is based on measurable statistics, such as:
- Gender
- Age
- Income level
- Marital status
- Education
- Race
- Religion
- Family size
- Family status
Examples of Psychographic Segmentation:
Socioeconomic class or lifestyle preferences are used to determine psychographic segments.
Values, beliefs, interests and the like are included in the lifestyle preferences classification, while the socioeconomic scale ranges from the wealthy and highly educated are at the top of the pyramid to the uneducated and unskilled are at the bottom.
Examples of Socioeconomic classes include:
The social class is divided into six categories according to the UK National Readership Survey.
- A Upper class Higher managerial, administrative, or professional
- B Middle class Intermediate managerial, administrative, or professional
- C1 Lower middle class Supervisory, clerical, junior managerial, administrative, or professional
- C2 Skilled working class Skilled manual labor
- D Working class Semi- and unskilled manual labor
- E Subsistence class Unemployed, seasonal, or casual
Examples of lifestyle preferences include:
- People who prefer an urban lifestyle as opposed to a rural or suburban lifestyle
- People who are pet lovers
- People with a keen interest in environmental issues.
Psychographic segments are based on the idea that people’s choices when buying goods and services reflect their lifestyle preferences.
Both of the above are then used to build your target market and buyer personas
Tip: A target market inside a business plan:
A business plan is a useful document that enables you to think through the problems involved in running a business. So preparation of the business plan will therefore help you look at your business from a businessperson’s perspective, rather than as a mere product.
The target market for your business plan is the customer base you intend to sell your product or service to. Planning with your target market in mind will also help you to answer all the questions that you may have at the beginning of the business process.
When you are planning to start a business, it’s helpful to know the target market inside and out so your business will know who It’s catering to. In other words, you want to know who would be buying your product or service. By knowing the target market, you can better gauge other parts of the business like how to structure, sell and deliver your product or service.
Here our some target market analysis examples from the brands you love.
1. What is the target market of Facebook?
The best way to understand Facebook is to think of it as a network of people. People join Facebook to connect with their friends and family, share their thoughts and interests with others, and engage with businesses and brands. Yes, it’s also a business, which means it’s a place where businesses can advertise, promote, and interact with their current and potential customers.
The question of what is the target market of Facebook remains open, especially with the recent changes to the News Feed and the introduction of Stories. But we can talk about the original target market of Facebook.
The company and target market of Facebook have evolved. The college students of the U.S. were the focus of the initial years of the company. In order to widen its target market, Facebook has positioned itself as a social media platform used mostly by middle-aged (25-34 years old) mobile users.
To recap, here is an example of Facebook’s target market is
25-34 year-olds, adults looking for news and to connect with family and friends.
2. What is the target market of Nike?
The market for merchandise is large and diverse and Nike has a lot of fun with it. In the late 1980s, the company launched the “Just Do It” campaign, in which retired sports greats such as Bo Jackson, David Robinson and Jerry Rice urged children to chase their dreams.
The next step in Nike’s growth strategy was to develop apparel that would appeal to a wider consumer base. In the early 1990s, Nike introduced the Air Jordan basketball shoes; they were so popular that the company was able to pay Michael Jordan to endorse it, and he soon became one of the world’s highest paid athletes.
Nike began to expand its sports apparel line with special collaborations with other celebrities, such as Kevin Garnett and Kobe Bryant.
Nike is a great example of a B2C company. Their products are targeted towards athletes and people who want to exercise. They have a wide range of apparel, equipment, and shoes.
A target market definition can’t be that broad, even though they work with athletes and a fitness-minded audience, It’s just too broad and if we where to cover all of Nikes targets it would be a blog post in its own right.
For today let’s start with two of their targets:
Young athletes:
A huge, growing category for Nike is kids who get frequent exercise and play sports growing up. Through sports leagues and associations, Nike engages with this market and has endorsements from popular sports stars.
Runners:
Nike shows that they target not just based on demographic information but also based on lifestyle with a focus on new types of shoes. for example designing shoes and apparel to help runners stay on the road longer.
3. What is the target market of Starbucks?
Starbucks is a Seattle-based coffee roaster that was founded by the Godfather of Coffee and named after the founder’s first great-grandfather. With over 24,000 coffee shops, it is one of the largest coffee chains in the United States, and is the world’s largest retailer of ready-to-drink coffee.
The company’s roots go back to 1971, when 23-year-old Melitta Bentz established a coffee stand in Seattle, Washington. She was soon joined by Jerry Baldwin, and the pair merged their business interests to create Starbucks Corporation
Next time you’re drinking a brew, at your local Starbucks. If you spend more than five minutes sitting and drinking your coffee, you’ll probably hear the barista’s shout out “Mobile Order.”
Did you know that up to 30% of Starbucks’ revenue comes from the mobile transactions process? Why because they’re targeting a tech-savvy crowd.
The next clue we have on their target market is the location of their shops. Starbucks has locations in heavy urban areas to lure on-the-go professionals.
50% of their customers are between the ages of 25 and 40 with such a big demographic base. Many Starbucks locations have been renovated/updated to offer a modern look to suit customers in these demographics.
To recap, here is an example of Starbucks’ target markets
25-40 year-olds, Tech-savvy adults who are working professionals.
4. What is the target market for Aesop cosmetics?
Aesop is a brand that was launched in 2016, in the UK and it’s been on my radar for a while now, for a reason. Their products are affordable, but not low quality, and they do have a wide range of products, from skincare to makeup, lip balm to hand cream.
They’re quite versatile in terms of what they do; in addition to the usual skincare products, they also include some hair care products, such as shampoo and conditioner.
They target people between the ages of 25 and 44 years old. It is more of a lifestyle choice than an entry level brand because of their price point.
it’s a brand that people in their mid 20s start getting serious about because they begin to have skincare concerns.
It’s not solely woman focused. It is not the same as some other beauty brands. The brand works well for both men and women and can be seen in the choice of partnerships like Mr Porter having a kit co-developed with Aesop.
The genius of this is that it is easier for a brand to target only females than it is for a brand to target both genders.
The lifestyle is an organic one. Plants and herb based products are often the focus of the company. It makes sense to people who want to be chemical free but still want effective products because they are concerned about what they put in and on their bodies.
To recap, here is an example of Aesop’s target market is
25-44 year-olds, adults looking for health organic skincare.
Famous Market Research Fails, Examples, and Stories
Businesses need market research to find and reach their target audiences. This type of research can help companies figure out marketing essentials like tag lines, value proposition, pricing, promotions, metrics and much more. There have been a number of fails in market research history. These can be easy to recover from for a big brand. However, small businesses could be doomed by this type of market research failure. Here is a few market research failures and how important they are.
Kodak Ignoring Market Trends
When only a simple design change is required, adjusting to consumer confusion is essential. We all know Kodak, but they have had problems recognizing the advent of digital photography. The necessary research was done by Kodak, but they chose to save money instead of listening to what the camera market research was showing. Digital photography costs and flexibility were looked at in the 1980s by the company.
Kodak decided against developing a digital camera because it would not help sales of film. Kodak’s heavy investment in paper and chemicals made it impractical to pursue the results of market research. The lesson? Companies need to be aware of the things you may not like in their market research. Their job is to satisfy consumers while consumer tastes and technology change. Otherwise, why bother with market research in the first place?
New Coke: A Market Research Failure and Recovery
What is the reason consumers buy Coke? Some clever marketing by Coca-Cola may have made them equate Coke with happiness. There are many reasons, but when sales of Coke dropped in the 1970s and the first part of the 1980s, the company thought taste was the cause of the decline. New Coke, a sweeter version of Coke, was introduced.
Many flaws were found in this introduction. Market researchers didn’t factor in the huge emotional impact Coke has on people, and they didn’t explain to taste test subjects that they would have to choose between drinking original Coke or New Coke.
Prior to the disaster, taste tests indicated that success was on the horizon. According to research, more people preferred the taste of New Coke over original Coke. The next thing to do was to stop selling the original Coke. This move proved to be a flop as consumers missed their favourite beverage and were put off by a different design of Coke.
Crystal Pepsi and Tab Clear: Same Taste, Higher Cost
Many consumers see water as pure and healthy, which is why Pepsi decided in 1992 to give consumers a clear picture of their product. The first year of sales was $500 million for the soda called Crystal Pepsi. Pepsi did not anticipate consumer confusion after market research indicated potential. There was a question about whether or not Crystal Pepsi was a lemon-lime soda. Was it more healthy? What was the point of having a clear drink that tasted similar to Pepsi, but cost more? This turned into a market research failure.
Crystal Pepsi plummeted after the first year of sales from curious consumers. Coca-Cola’s Tab Clear had launched in 1992, which may have caused consumer confusion. It was a sugar-free diet cola (that also did not work). Consumers were confused as to why they would have to pay more for a product that was transparent and old. Many were confused from the way they looked and tasted. These flaws may have been brought to light by better market research.
The Conclusion:
So now you know what a target market is, how important it is and some examples of the good bad and the ugly. Everybody can be effected by bad market research or targeting, weather your Coke, Kodak or Pepsi.
In your marketing plans your marketing efforts must focus on the ideal customer. This will improve your marketing messages because you understand the target customers and their geographic segmentation and behavioral segmentation.
So I challenge you to nail down your target market to help improve your overall marketing strategy.
That’s all for today until next time this has been Jack Thomson’s
