Based on your competitor analysis, you should now narrow down the target group you’re aiming for. You need to decide whether you should (a) flank your competitors, targeting essentially the same markets as they are, or (b) target a narrower market than they are pursuing, or © go after a market that’s broader than theirs.
Being a part of your own target group is worth a lot
The ideal way to understand your target group is to be part of it yourself – or at least know that market intimately. You don’t achieve this, by the way, just through focus groups, surveys or questionnaires. They have their uses and can be helpful, but they aren’t a complete answer these days. If your target group’s needs and interests match your own, you’ll be more likely to survive, and hit the marketing bull’s eye far faster in terms of product features and price levels.
You’ll have a better idea of what your competitors are missing on – what they don’t provide, but should, as well as what they do provide that isn’t really needed and wanted. You’ll also know what the competition does or says that’s irritating.
If you’re not part of the target market yourself – or at least intimately familiar with it – there is a great risk that you will never come up with a product that’s even close to the market’s needs, and so you will fail. If you somehow make it anyway, it will only be after you’ve spent a lot of time and effort trying to understand the target market while attempting to serve it.
Naming a target group that’s too generalized is a dead end. Be specific and define it very clearly. By researching your target group, you’ll learn where to blog, what forums to join and participate in. Through active examination, interaction and interchange with your target group, you’ll gain a good under- standing of their interests, concerns, gripes, needs and wants. You’ll learn how they like to communicate among themselves, and how they like to communicate with companies serving them.
Yes, content is the new marketing machine, and is by far the most long-term and efficient one. You can always open up your offerings and broaden your marketing efforts to include a bigger market, as you go along. But a specific and narrow target market is the best way to begin. It will help you to stay focused, and true to your original concepts and purposes.
Even if your product development includes user involvement, you need to stay many steps ahead of the needs of your existing customers and potential customers.
A target group is rarely defined by age alone, as they often were in earlier times. Modern market targeting is much more specific, and oriented to other factors than age. This just makes good sense, since it’s obvious that you can find similarities between 22-year-old men (for example) and 50-year-olds. A member of either group might just have started their first business, let’s say. They both need the same sort of soft- ware to handle their business’s finances.
You should work on separating your general target market into its different segments. Think of it like buying an airline ticket – the plane gets everyone from A to B, but price charged and services received definitely differ between monkey class, business class and first class. Look at your product in the same way.
Some people just want the cheapest they can get, and still have their bare-bones basic needs covered. Some are more interested in having the most and best features and benefits, without much concern about price; still others are searching for something in between.
This is why you often see software companies offering several different packages, all centered around the same core product. By doing so, they can meet the needs and wants of different types of customers within the same more general target group. This is a way to optimize profits, and provides a built-in way to up-sell to different kinds of customers. We’ll cover price optimization in greater detail, in a later section.