Strategic Planning Kit For Dummies®, 2nd Edition

Creating Your Target Markets

Think about your market as though you're someone who's interested in buying your product or service. You may have some luck reaching some of your customers with a widespread approach, but a targeted approach is more effective. In order to use a targeted approach, you have to aim at a clear target — your ideal market. To create a target, you need to take a sea of customers and group, or segment, them. You then create groups of customers based on similarities; each group becomes a target market.

The goal of creating target markets is to target specific customers who have similar needs and wants with the same message, products, and pricing and through the same distribution channels. When done correctly, your target market responds similarly to your marketing efforts.

Look at the following two 24-Hour Fitness customers as an example:

Tim is a health nut. Working out is his life. He typically uses the facilities five times a week. He's on a program established by his personal trainer and has referred two people to the gym this year already.

Sheila, on the other hand, hasn't set foot in the gym since she joined six months ago.

Membership renewal fees for both Tim and Sheila are due next month. If 24-Hour Fitness uses the same strategy to encourage Tim and Sheila to renew, their tactics may fail. Tim already understands the value and is a satisfied customer. However, Sheila needs substantially more communication to see the benefit. The company may likely ...