A target market is a group of customers within a business’s serviceable available market that the business has decided to aim its marketing efforts towards. Target markets consist of consumers who exhibit similar characteristics and are considered most likely to buy a business’s product or service.
What is a ‘Target Market’
A target market is the market a company wants to sell its products and services to, and it includes a targeted set of customers for whom it directs its marketing efforts. Identifying the target market is an essential step in the development of a marketing plan. A target market can be separated from the market as a whole by geography, buying power, demographics and psychographics.
Explaining ‘Target Market’
A company invests significant amounts of time and capital to define and monitor its target market. Not all products and services are meant for all types of consumers, and consumers are often cautious with their spending power. For this reason, target markets are typically segregated by age, location, income and lifestyle. A company defines its target market by the consumers that are likely to have a need for its product. Defining a specific target market allows a company to hone in on specific market factors to reach and connect with customers through sales and marketing efforts.
Significant Factors About the Product
The target market is a central focus within a marketing plan that determines other essential factors for the product, such as distribution, price and promotion efforts. The target market also determines significant factors about the product itself. In fact, a company may tweak certain aspects of a product, such as the amount of sugar in a soft drink, so that it is more likely to be purchased by consumers with varying tastes.
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