Strategic Planning Kit For Dummies®, 2nd Edition

Focusing on the Most Attractive Markets

Choosing which target markets to pursue can be challenging because you may want to target all segments, especially those that are growing and appear very profitable, but resist the temptation. Most businesses can't possibly serve all identified target markets (or at least not well). Try to choose between one and three new markets to target at any given time.

Additionally, you want to make sure that your company doesn't enter into segments that you can't support or don't have the resources to provide excellent customer service. You want to focus your energies on the most attractive segments. I show you how to identify attractive markets and then evaluate them in the following sections.

Defining an attractive segment

If you identified only two or three new markets total, verify that you've identified the most attractive target markets. Use the following checklist to evaluate the attractiveness of each potential segment:

• Competitors: Look at your competitor analysis (Chapter 10 covers this topic in detail). Are you better than the competition? Is the competition getting better or worse at meeting the needs of customers in this segment?
• Company resources: Do you have the right strengths to compete in this segment? Do you have weaknesses that need to be improved and are they fixable? In Chapter 7, you can review your company's strengths and weaknesses. Look at the culture of your organization. Is it consistent with serving this segment?
• Segment ...