One of the answers that marketers hate is “everyone.” I am sure you know as a small business “If you're selling to everyone, you're selling to no one.” But, why? Because everyone has a different taste or preference. Therefore, if you do not narrow down your audience, you cannot fully fulfill your customers’ needs. Not convinced yet? Let’s say I am buying a laptop and I am a graphic designer. The first thing I would look for would be the screen quality. If it has a decent sound quality, that is a plus, but not necessary. However, if there were another laptop with average sound quality but a processor just designed for graphic designers, then I would buy that one.
Whatever you do, marketing always starts with identifying your target market. There are three ways to identify your target market. First, you could do market research with your prototype or minimum viable product especially, if you have a unique product (same for service businesses). Then analyze the feedback from different groups and see which group has a more positive attitude (do not forget the collect their information such as age, job, income, education level, etc.). Second, look at your competitors and see who buys their products/services. Third, use readily available market research that research companies provide such as IBISWorld, Frist Research, Forrester, etc. Some of them might be free through your university, institution, company or library.
If you already have a small business and customers. Then you can skip the research part, mine your data, and look at the analytics tools that you use (Google Analytics, Social Media Analytics, etc.).
After you have some idea about your target market then you can start working on your buyer personas. This is the fun part!
There is no limit on the number of buyer personas that you need. However, remember marketing is all about limits! That said, 3 or 4 personas would be enough to start. Criteria (lifestyle, demographics, pain points, etc.) depend on your business and your target audience. But make sure you capture the most important factors influencing buying behavior in your industry.
Title: Vice Persident in Corporate Banking
Job: Decision-maker, has a team
Lifestyle: Reads Wall Street Journal, heavy Twitter user
Motivations: Growth, satisfying shareholders, recognition
Pain Points/Challenges: Too much process, no efficiency, difficulty in getting accurate data
Buyer personas are pretty useful because you know who you are selling, you know where they go, what they watch, when and why they buy. That said you could significantly cut your marketing costs because you do not need to do everything you just need to follow your target market. If you are selling to baby boomers, you may not need to spend money on TikTok or Snapchat, because your return on ad spend would be very low.
For example, let’s say you are developing B2B Data Analytics Tools for Banking. By using the persona above you can prioritize accuracy and user interface (for efficiency) of your product. Furthermore, you post more frequently on Twitter and spend some money on Twitter ads. If you want your sales team to close more deals, you know that they need to talk to the Vice Presidents.
One of the main reasons Amazon bought Whole Foods is that they realized their target market; the Urban Millennials love to shop at Whole Foods. So, Amazon thought they can get more Amazon Prime members from Whole Foods shoppers and they can grow their penetration in the Urban Millennials segment.
Knowing your target market comes with a reward, loyalty. If you know your customers well enough, solve their problems, and make life easier for them there is no reason for them to leave you. But if you get too greedy, that means you would need to spend your energy and resources to other areas and you may not serve your core customers well enough.
The Duquesne University SBDC provides free business consulting for entrepreneurs in the Greater Pittsburgh area. Click here to request free consulting, or contact the SBDC for additional help and information.
Tunca Cali is the Marketing & Training Coordinator of the Duquesne University Small Business Development Center (DUSBDC). He earned his MBA degree from Duquesne University. He has worked with several clients over the past years and helped them to develop marketing strategies as well as marketing and coordinating the training events offered by the DUSBDC.