This week we address the concept of Target Market:

  • Is there a large enough use case that can be created? Eg- UBER. People take rides all the time. Can they shift from owned vehicles to hired ones? We have seen over time this trend rising on the back of promotions/ driver incentives etc. Its expensive, Uber is not profitable, but there were investors who put in billions of dollars to create a new consumer habit. These are category building innovations.
  • Or, there is a large enough user base that uses a variation of your product and sees the value of your innovation over competition. In which case, they switch from competition rapidly. Example- Consumers who moved from Colgate to Pepsodent. Or from ordinary shaving systems to Gilette.

So how does one define the target market?

Target Market and Target Audience:

So now, how do you define your target market in a useful manner?

  1. Meet buyers of your product ( if its an existing category); else potential buyers of your product.
  2. Ensure you have a large enough sample , and if you can take the help of a “research agency”, you would be sure you’re getting the right information, without any biases.
  3. Use your existing buyer data and break it down into as much detail as possible. For example, you may actually realise yours is a purchase that happens on weekdays at 6 pm and at specific metro stations close to offices- typically as people leave from work. That’s a very specific and powerful starting place for your understanding of your market.

To conclude, we would add one more aspect of your target market definition:

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Venkatesh Rangachari

Venkatesh Rangachari

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