Chapter 11 Target Market

What is a Market/Target Market A group of people who have a demand for a product. A group of people who have a demand for a product. The particular group that you are interested in reaching The particular group that you are interested in reaching Example Teens, year old males, and senior citizens Example Teens, year old males, and senior citizens

Why do Businesses choose a Target Market? Identifying potential customers for your business, product or service can be difficult as people are constantly changing, but if you know your target audience you can better learn how to market to them. Identifying potential customers for your business, product or service can be difficult as people are constantly changing, but if you know your target audience you can better learn how to market to them.

Example of A Target Market: Al’s clients are parents with young children, many from his daughter’s preschool. Al sends a quarterly newsletter to his clients. Because he focuses on a target market with common needs, he is able to select Al’s clients are parents with young children, many from his daughter’s preschool. Al sends a quarterly newsletter to his clients. Because he focuses on a target market with common needs, he is able to select articles that have almost universal appeal to that market. articles that have almost universal appeal to that market. His newsletter includes one article that discusses practical information relevant to his clients’ situation but has little to do with his products and services. For example, one month he included an article on toddler car seats, written by a local consumer advocate. Another article will discuss something relevant to the products and services Al provides as a financial advisor such as education planning. His clients appreciate both types of information. Al’s newsletters help cement his relationship with his clients. His newsletter includes one article that discusses practical information relevant to his clients’ situation but has little to do with his products and services. For example, one month he included an article on toddler car seats, written by a local consumer advocate. Another article will discuss something relevant to the products and services Al provides as a financial advisor such as education planning. His clients appreciate both types of information. Al’s newsletters help cement his relationship with his clients.

1. OLD SPICE DEODORANT 2. COVER GIRL MAKE-UP 3. TI MUSIC 4. NY GIANTS SWEATSHIRTS 5. LEXUS Who is the target market for these products?

What is Market Segmentation? Uses specific characteristics to analyze your market by breaking down a larger target market into smaller segments. Uses specific characteristics to analyze your market by breaking down a larger target market into smaller segments. –Demographics –Psychographics –Geographics –Buying Characteristics Draw Picture of Segmentation

What are Demographics Age Age Gender Gender Location Location Education Education Income Level Income Level Marital Status Marital Status Household type Household type

What are Psychographics Needs: Security, Love Needs: Security, Love Values: Status, Success Values: Status, Success Buying Styles: Fads, Price Buying Styles: Fads, Price Culture: Religion, politics Culture: Religion, politics Interests: Recreation, shopping Interests: Recreation, shopping

Psychographics (attitudes) examples Need for status Need for status Role of money (does it buy material Role of money (does it buy material things, self-esteem, etc?) things, self-esteem, etc?) Ethics/"moral compass" Ethics/"moral compass" Risk-taker vs. conservative Risk-taker vs. conservative Spendthrift vs. hoarder of money Spendthrift vs. hoarder of money And when the target audience is identified, you'll then have an idea of what your key message should be and how to convey it. And when the target audience is identified, you'll then have an idea of what your key message should be and how to convey it.

What is Market Research A process designed to identify solutions to a specific marketing problem. Example, identifying which products to sell. A process designed to identify solutions to a specific marketing problem. Example, identifying which products to sell. Two Types: Two Types: –Primary – Surveys, Focus Groups –Secondary – Internet, Government Sources

Types of marketing research Marketing research, as a sub-set aspect of marketing activities, can be divided into the following parts: Marketing research, as a sub-set aspect of marketing activities, can be divided into the following parts: Primary research (also known as field research), which involves the conduction and compilation of research for the purpose it was intended. Primary research (also known as field research), which involves the conduction and compilation of research for the purpose it was intended. Secondary research (also referred to as desk research), is initially conducted for one purpose, but often used to support another purpose or end goal. Secondary research (also referred to as desk research), is initially conducted for one purpose, but often used to support another purpose or end goal.

By these definitions, an example of primary research would be market research conducted into health foods, which is used solely to ascertain the needs/wants of the target market for health foods. Secondary research, again according to the above definition, would be research pertaining to health foods, but used by a firm wishing to develop an unrelated product.

The Research Process Identify a need or problem Identify a need or problem Obtain Primary and Secondary Data Obtain Primary and Secondary Data Organize Data Organize Data Analyze Data Analyze Data Recommend Solutions Recommend Solutions Implement a plan of action Implement a plan of action