One of the most fulfilling things about entrepreneurship is being able to start a business and grow it profitably. However, starting and building a profitable brand does not come on a platter of gold. It requires the mastery of being able to define your target audience and then working hard to properly position your business, so you can attract them.
Several small businesses struggle with defining their target audience. Many don’t even have a strategy, yet they wonder why their business is not gaining traction.
Growing a business is not just about having a great idea. It’s about having people who are willing to buy for the price you are willing to sell. That’s why it’s important that you take the time to define who your target audience are and how you can position your business to attract them.[Great Read: 10 Proven Ways of Attracting Customers and Reaching Your Revenue Goals]
A product for everyone is NOT a product for anyone
As an entrepreneur, one of the biggest mistakes you can make is trying to sell to everyone in the marketplace. This is especially true if you are a new business owner and are still trying to gain your footing.
However, one way to understand the importance of market segmentation is that a product that’s designed for everyone is not a product for anyone.
Think of it this way: If there was just one type of toothbrush in the world, how effective will this toothbrush be and more importantly, how many people will be left out? That’s why you need to segment the market before you attempt to sell to them.
If you remember segments from Geometry class, then you have a basic understanding of what segmentation means. To help you gain a better understanding, think of the people in the marketplace as a whole piece of the pie that is cut into a million pieces.
Your goal is to get that piece or pieces of pie for which you are most suited. Do not be tempted to sell to everyone because your marketing messages will be lost in the crowd.[Great Read: How to Attract Quality Customers When You Are New to the Marketplace]
Let’s define segmentation formally
Segmentation is the grouping of potential customers that share similar traits, have similar needs or have similar buying characteristics. The world is made up of billions of people who have similar and diverse needs. The goal of segmentation is grouping. When you group people with similar characteristics together, it’s easier to market to them and gain their attention.
Examples of these characteristics include age, income, personality type, buying patterns, location, marital status, ethnicity to name a few.
Once you are done segmenting, you need to ask critical questions. Examples of such questions include:
- Is the segment profitable?
- How accessible is the segment?
- What type of existing data is available?
Your answers to these questions are designed to help you know if you’ll be successful or not. Another point of consideration is your competitors. Who are the existing competitors and what percentage of the market share do they control? How can you attract a part of that market share or how can you attract all the market share?
A proper segmentation will give you insights and help you with better planning.[Great Read: The Only 7-Step Guide You Need to Build a Top-Notch Personal Brand]
Once you are done segmenting, the next stage is targeting the segment. You target the segment where you believe you’ll make the most impact.
For example, if you are a caterer, you can target your audience on speed, convenience, price levels, etc. Choose the aspect where you know you can serve your customers the best. The aspect should be where you are most skilled to meet your customers’ needs.
Your products might be the best thing in the world but if people barely know about them, then there is no point. At Onpoint Success, we’ve worked with many clients who shared that they did not understand the concept of segmentation, targeting and positioning. That’s why we work hard to help our audience understand and implement these concepts in their businesses.
If your business is not properly positioned, then there is no way you’ll make sales. One way to understand how important positioning is when you market to customers on Facebook while your customers are on LinkedIn. If you do not get to the nitty-gritty of segmenting, targeting and positioning, it becomes an uphill task to build a profitable brand.
To position your brand, ask and answer the following questions:
- What position would you like to own?
- Who currently owns that position?
- What message do you have?
- Do you have the patience to persist until you breakthrough?
- Are your efforts in the right direction.
Now, that you’ve learned the importance of segmenting, targeting and positioning, it’s time to get to work. The best approach is to develop your business model. Your business model is like the GPS of your business. If you need to learn about how to develop a business model, click HERE.
If you’d like Onpoint Success to develop a customized business model for you, click HERE.
Thank you for reading. How do you properly position your business? Share with us in the comment box and remember to share this post with a friend.
P.S. Need a business success strategy for your brand? We are the business success headquarters and we are here to help you to develop a customized business success strategy that will help you grow your business profitably. Click HERE to get started today!