My first two columns dealt with Vision. This month, I’ll cover Target Market, a key element of Strategy, which is the set of choices you make to try to achieve your Vision.
A golden rule of strategy:
Imagine trying to build a car that pleases everyone. Some will want it to be as environmentally friendly as possible. Some think internal comfort and luxury are the most important things. Lots of people choose price as their top priority. Others will choose speed and power. There’s no way you can give everyone exactly what they want, and the harder you try, the more everyone will go “Meh.”
Philip Kotler, professor of marketing at Northwestern University in the US, states, “There is only one winning strategy. It is to carefully define the target market and direct a superior offering to that target market.” This is not to say that you will only ever sell to your target market. Apple’s target market for the iPhone has been mid-30s males – will they stop females from buying an iPhone? Of course not. The idea is to ‘delight the few to attract the many’. When your product really delights your target market, other customers are attracted too. (pull-quote)
Get very specific about the narrow segment of people you are targeting. Find out which type of customer is your most profitable, the best opportunity for growth, and the most influential. Then make a call on which is the most attractive segment overall. Analyse this segment across the following criteria:
Once you have identified your target market segment, delve deep to find out what their greatest needs are. This can be a very tricky business, as often your customers don’t know what their root cause needs are. As Henry Ford is quoted as saying, “If I had asked people what they wanted, they would have said faster horses.” But it is your job to uncover their real greatest need. When you have done that, your next job is to figure out how to meet those needs more effectively than anyone else – that superior offering referred to above by Philip Kotler. We will cover this in the new year.
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by Chris Bunce
Chris has 28 years’ experience as a management consultant and business coach. During this time he has worked with clients in many industries and of all shapes and sizes, including some in Australia, Asia and the US. Nowadays he is passionate about improving the lives of Aucklanders by helping business owners to master the very few management practices that actually make a difference to their success. Chris lives in Blockhouse Bay with his wife, Cathie, having lived in or around the area for most of his life.