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Defining Your Market in 7 Steps

Defining Your Market in 7 Steps

Engaging your target audience requires you to create quality content that provides enough value  that your readers will respond to a call to action, whether it is sharing content, clicking to buy an item, signing up for a newsletter, or simply returning to your website.

No business — particularly a small one — can be all things to all people. The more narrowly you can define your target market, the better. This process is known as creating a niche and is key to success for even the biggest companies. Walmart and Tiffany are both retailers, but they have very different niches: Walmart caters to bargain-minded shoppers, while Tiffany appeals to upscale jewelry consumers.

Rather than creating a niche, many entrepreneurs make the mistake of falling into the “all over the map” trap, claiming they can do many things and be good at all of them.

Creating a good niche, involves following a seven-step process:

1. Make a wish list.
With whom do you want to do business? Be as specific as you can: Identify the geographic range and the types of businesses or customers you want your business to target. If you don’t know whom you want to do business with, you can’t make contact.

These days, the trend is toward smaller niches. Targeting teenagers isn’t specific enough; targeting male, African American teenagers with family incomes of $40,000 and up is. Aiming at companies that sell software is too broad; aiming at Northern California-based companies that provide internet software sales and training and have sales of $15 million or more is a better goal.

2. Focus.
Clarify what you want to sell, remembering: a) You can’t be all things to all people and b) “smaller is bigger.” Your niche is not the same as the field in which you work. For example, a retail clothing business is not a niche but a field. A more specific niche may be “maternity clothes for executive women.”
• Make a list of things you do best and the skills implicit in each of them.
• List your achievements.
• Identify the most important lessons you have learned in life.
• Look for patterns that reveal your style or approach to resolving problems.
Your niche should arise naturally from your interests and experience. For example, if you spent 10 years working in a consulting firm, but also spent 10 years working for a small, family-owned business, you may decide to start a consulting business that specializes in small, family-owned companies.

3. Describe the customer’s worldview.
A successful business the Platinum Rule: “Do unto others as they would do unto themselves.” When you look at the world from your prospective customers’ perspective, you can identify their needs or wants. The best way to do this is to talk to prospective customers and identify their main concerns.

4. Synthesize.
At this stage, your niche should begin to take shape as your ideas and the client’s needs and wants coalesce to create something new. A good niche has five qualities:
• It takes you where you want to go
• Somebody else wants it
• It’s carefully planned.
• It’s one-of-a-kind, the “only game in town.”
• It evolves, allowing you to develop different profit centers

5. Evaluate.
Now it’s time to evaluate your proposed product or service against the five criteria in Step 4. Perhaps you’ll find that the niche you had in mind requires more business travel than you’re ready for. That means it doesn’t fulfill one of the above criteria — it won’t take you where you want to go. So scrap it, and move on to the next idea.

6. Test.
Once you have a match between niche and product, test-market it. This can be done by offering samples, such as a free mini-seminar or a sample copy of your newsletter. The test shouldn’t cost you a lot of money, so If you spend a lot on the initial test, you are probably doing it wrong.

7. Go for it.
It’s time to implement your idea. For many entrepreneurs, this is the most difficult stage. But fear not: If you did your homework, entering the market will be a calculated risk, not just a gamble.

Engaging your target audience requires you to create quality content that provides enough value that your readers will respond to a call to action, whether it is sharing content, clicking to buy an item, signing up for a newsletter, or simply returning to your website.