Having a well-defined target market is crucial to your business plan. By having a clear niche target, small businesses can compete with larger companies.

Keep in mind, a target market doesn't prohibit those outside of it from buying from you. Instead, it’s concentrating your marketing dollars and efforts toward one area.

Take some time and start researching to find the right people to include in your target audience. In doing so, here are two areas to focus on as you start developing your target market:

Examine Your Customer

Get to know your customers a little better. To start, research, collect information, analyze data and make decisions using these segment guidelines:


This is possibly the most important aspect of learning about your customer. The demographics you want to research are those similar to information the Census Bureau would collect. This includes information such as age, gender, ethnicity, income, occupation and more.

Also included in the demographic of your customer can be their geographical location. Take a look at the physical location of those interested in your products and/or services. In doing this research, you’ll begin to see who your customers are. You’ll have to take another few steps to learn about how they think and act.


Digging deeper into your target audience, you want to take a look into their psyche. How are your customers living? What are they interested in? Examine their hobbies and how they are spending their free time.

Another big part of this would be the customers’ behaviors. Study what brands they’re buying now. Concentrate on products they’re using, how often they’re shopping, what amount they’re spending on these purchases and more. You can even take a look at how well they know the product, this can help you adjust the messaging in your marketing.

Information such as music they like and other behaviors can help you take a look at what’s influencing buying habits.

Identify what your customer needs

Identify the pain points your customers have. From that, you’ll be able to provide them with a solution to their problem through your products and services. For instance, every parent is “busy,” but not every busy parent works away from home and has young children.

Since parents choose the day care, market to them instead of the children. This will help you develop a specific age group, let’s say ages 25 to 40 in this case. It also might be helpful to decide which gender to favor, either the mother or the father.

Understand Your Competitor’s Customer

The second area to focus on is the customer that your competitors are targeting. Be sure to understand them just as well, so you can tailor your product or service to an untapped market.

Create a competitive advantage

Create offers or products that help your company stand out in the crowd.  Specifically, create something that competing businesses are not providing. For example, a daycare could offer benefits and accommodations for parents with more than one child. Then you can look into the average number of children per family in the area near your business and cater to that number. This deal would separate you from other day cares that target families with any number of children.

Emphasize what sets you apart

In addition to focusing on specifics that your competitors are not offering, be sure to focus on aspects that they could never offer. An example would be a prime location on the busiest street in town. Highlight this advantage to the people that enjoy the area, or those that are geographically located near your business.

Never stop targeting

It is important to retain the customers that you have already won over. You need to grow with your customers and consistently provide them with more reasons to stay with your company. One way of doing this would be providing meaningful content on your website. This will show your customers that they can value and trust your business.

How much do you know about the customers you seek to do business with? How about the customers your competitors are targeting?