Starting an Online Business All-in-One For Dummies®, 3rd Edition

Identifying Your Market and Target Customer

The terms target market and target customer are defined as the entities that buy your product or service. Although these phrases are sometimes used interchangeably, market is often used to describe a collection of individual target customers.

The target represents the people who are most likely to buy or use your product or service.

Classifying your customer

Knowing your target customer is an important advantage when you begin marketing. As we explain in earlier sections in this chapter, recognizing your primary customers lends credibility to your business concept. The more you know about your target customers, the more easily and cost-efficiently you can build your business and market to these folks.

How do you decide who this person is or who the groups of people are? You can describe or segment your customers. The two most common classifications are

• Demographics: Age, income, gender, and occupation are examples of common factors used to describe your customers.
• Psychographics: Music choices, hobbies, and other preferences make up this category. Usually, psychographics reflect lifestyle choices.

You can also describe your customers in other terms, such as these categories:

• Benefits: Describe why customers use your product or service. For example, customers might need it for medical purposes, or they might receive a luxury benefit, ...