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Why is Your Target Market So Important?

There are multiple reasons why your target market is important. Watch this video to find out more.
Why is your target market so important to you? First of all, it’s the foundation of your entire go-to-market strategy Esentially is a combination of your product strategy, your pricing strategy, your positioning strategy, your messaging strategy, your marketing strategy, your selling strategy and your branding strategy, all rolled into one, that’s called a go-to-market strategy, and target market blinks to each and every one of those. The other reason why I think it’s important for entrepreneurs is it focuses you.
You generally as entrepreneurs want to kind of be a little bit all scattered around because I know I’m an entrepreneur I know about it for me and this is going to actually focus you down into really getting specific about who you’re going to talk to. So, why do investors care about your target market? Well, first of all, they’re going to ask you about it. So you want to make sure you know it. Second thing is that they’re little bit confused about what your product or service is, or what the value of your product or service?
They’re going to go to your target market and say, okay, they’re going to compare that target market and do they see that as being valuable. They’re also going to take a look at your problem statement as it relates to your target market,. So are you solving a problem for your target market that’s very important to them. and their overall analysis of what they’re doing for you and then finally, feasibility. Feasibility of your business is your business feasible? Do you have a target market that will do certain things? So for instance, is your target market big enough? Is your target market too broad? Is it already saturated? Is your target market attractive to them?
is your target market aligned with your product strategy? and is your target market consistent with all of your other strategies that you have? All of your other go-to-market strategies. That’s what they’re going to be looking for. So you want to make sure you’ve got pinpoint accuracy on this target market. So before we get into our exercise, I want to give you a couple of tips to make it a little bit easier to get through this. First of all, I always recommend start with one target market. That’s kind of important. Yes, you might have two or three different target markets that you’re going after but really focus your business plan on the key target market that you want to address.
Now, don’t get too worried because if you feel that you’re getting too narrow in your target market or it’s not exactly right. You can always brought on it after you go to market you can always extend it, so don’t worry about that. Next tip is that I suggest that you start with your product or service and how that product or service is defined, and from that you start to define your target market you look at your product or service and say who is this going to be most ideal for most valuable to and that will help define your target market from there.
The next thing is I want to make sure, once we defined our target market that every other strategy that you have in your business is linked up to your target market. That means that it’s checked, that we have internal consistency amongst your positioning strategy to your target market, your distribution strategy, to your target market, your acquisition strategy to your target market. It’s all very important. Make sure it’s internally consistent. Now, let me tell you a story because I know that entrepreneurs I know that the first thing you thinking of is “I don’t want to narrow my target market. That’s not what I want to do.
Well, I got to tell you a little story that when I was graduating from USC business school, the commencement speaker is a guy that I don’t even remember his name, but I remember when he talked about, and the entire speech was about if you want to be successful in business you develop a niche within a niche. Pitch that was key to him. And I remember that I remember sitting in that seat right now listening to him saying the more focused your target market is, the more successful you will be. That was his pitch and I got to tell you for the last 25 years, I’ve been doing that. I’ve been living that and it’s been working pretty good for me.
So I just parked pass that on to you that being more focused and more narrow in your target market generally speaking is better. As I’ve said before your target market is critical to your overall business strategy. In fact, it’s the center of your entire marketing strategy because it will inform how you build your product or service, it will inform your key messages. Who are you competing with? Your relevancy of your problem statement? How you price your product? How you distribute your product? How you sell your product? What marketing channels are you going to use? and what discounting and promotional strategies are best for your target market? All of this together will help define your overall marketing strategy.
So what are the core strategies that your target marketing forms? your positioning strategy, your value proposition, your product strategy, your pricing and discounting strategy, your problem statement, your acquisition strategy, and your distribution strategy. All of those are being formed by your target market and at the center is your target market Now, a couple of things that I want to make sure that you keep in mind which is this idea of internal consistency or internal inconsistency. Right? What we want to make sure is that each one of these strategies connects up to your target market, right?
So let’s say we’re looking at your pricing strategy perhaps and we want to see whether or not it’s internally consistent or internally inconsistent with your strategy. So you’re selling to a lower income demographic. Yet you have a product that’s actually priced higher or priced as a premium product at a higher price point, so there’s some internal inconsistency there that we need to reconcile. So another example might be you’re selling to an upper-class market. Yet you’re applying heavy discounting and promotional strategy to that and that really won’t resonate with the upper market or a richer more affluent customer. So you can see again that you’re discounting strategies there would be internally inconsistent with your overall strategy or your overall target market.
That’s what we want to resolve. So keeping all this in mind. What I want to do is I want to walk you step-by-step through the process so that you nail it right in the bullseye.
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