What do you think, which channel would give you the best results when marketing designer furniture: a lifestyle magazine/portal, a webpage for interior design enthusiasts or a club of amateur auto sports athletes? Most likely, offers of nuts and bolts are more interesting for the latter one – generally speaking, motorsports guys are not really the target group for designer furniture. However, advertising aimed at a wrong audience is like water off a duck’s back.
In this article, we will talk about the importance of knowing your target audience and the steps to define it. We will also look at what are the recent concerns in finding the target market and how to deal with them.
What Is Target Audience?
First and foremost, let’s define target audience, aka target group or target market. It refers to a specific and well-defined group of people to whom the company targets its marketing activities. To belong to a target group, its members must have certain common characteristics, based on which a company can assume that the person might be interested in its products or services. For example, a target group can be defined based on demographics (age, gender, income, education level, etc.) or also on the basis of geographic location. It can also derive from psychographic data (lifestyle, interests, values) or past behaviour (shopping habits, brand loyalty).
Why Is It Important to Know the Target Group?
Identifying the target audience is of key importance for a business, because it creates the basis for all marketing activities – not just advertising, but also product development and pricing. By knowing your target audience, you can:
- adjust your products and services based on the needs and preferences of your potential customers;
- finetune prices and discount policy;
- choose the right channels where your messages will be best delivered;
- create more effective marketing messages that appeal to potential customers and inspire them;
- engage your customers more and communicate with them more actively, creating long-term relationships;
- adapt to changes in the market by changing strategies and offers based on new customer preferences, thus, remaining relevant and attractive to customers.
As a result, you’ll have more effective campaigns, stronger customer relationships and increased sales.
How to Define Your Target Group?
Determining the right target audience for your products and services is a systematic process that, in fact, must be pursued consistently because the market and customer preferences are constantly changing. Get started by doing the following:
- Conduct thorough market research. Collect data about your industry, competitors and potential customer segments using, for example, surveys, interviews or online tools (Google Trends, Social Mention, Facebook Insights, etc.).
- Create a demographic profile of your target customers, defining, for example, what age, gender, education level, marital status, income and occupation you are preferably looking for.
- Consider various psychographic features: interests, hobbies, values, lifestyle, attitudes. It helps to understand the preferences of your potential customers.
- Define behavioural patterns by analysing the target group’s shopping habits, brand loyalty, web and social media usage. This way you can find out which channels people prefer, and how they mostly communicate with companies.
- Consider geographic location. Are you targeting local, regional, national or international clients?
- Determine the needs of your potential customers. By knowing them, you can better position the product or service, offering solutions to specific problems.
- If the company has been operating for longer, analyse the existing customer base, and identify their common features.
- Consolidate all the data, and create detailed customer profiles. These are your ideal customers, and it’s easier to plan marketing activities when you have a specific customer in mind.
If you’ve already created a marketing strategy based on a previously defined target group, and you start implementing it, make sure you monitor the results, gather feedback, and analyse sales data. Based on regular analysis, you can further specify the target group in order to keep yourself up to date with the market and customer preferences.
The Big Brother Glory Days Are Over
Not long ago, companies could monitor people’s activities online quite freely, enjoying a kind of heyday of a Big Brother (it’s a separate question how ethical such data collection is or was). However, the situation has now changed considerably. Especially in Europe, data protection is an important issue, the laws are becoming stricter, and people themselves start understanding better what does privacy or the lack of it mean. Therefore, data collection has become much more difficult.
In the past, using third-party cookies on the web was very common, now, they are gradually disappearing. This year’s State of Marketing Trends 2023 report by HubSpot, a developer and seller of software products for marketing, reveals that 85% of marketers say their marketing activities are slightly to completely reliant on third-party cookies. In order to adapt to the changed circumstances, strategies must be changed radically.
The most popular solution is exploring using social media for targeted ads, the second is collecting first-party data from customers (data handed from customers directly to a company), the third is exploring Google Topics API (part of Google’s Privacy Sandbox). A little less attention is paid to exploring universal identifiers and contextual advertising.
The situation is even more complicated, taking into consideration the continuous environment of crises in recent years, that has radically changed and still is changing people’s interests and purchasing behaviour. It is therefore clear that new approaches must be applied to define and reach the target group. It’s important to analyse the clientele consistently, taking the most out of data collected inhouse: website traffic, surveys, CRM systems, etc. We at Hundred can help you use online tools and grab social media opportunities, in order for you to reach the largest possible share of the company’s potential customer base, and to help you grow your brand now and in the future.