Market Targeting in Business: – Marketers will tell you that once you have identified your potential segments, you must target in your selection the ones you are going to “attack”. These decisions are important and will make your business a long-term business. Strategic decisions, an opportunity for small businesses and Marketing targeting are essential steps.
Why Market Targeting
The reasons flow from themselves:
- Appear as a Specialist
To be recognized as an expert on the issue by customers and prospects. You can then introduce yourself as the “expert” of the question. An expert who can provide solutions to their specific issues
- Differentiate and Increase your Margin
This is the induced effect of a specialization strategy. If you manage to build a specialist image, you can more easily value it from your customers. It will then be possible for you to move your trade negotiations to other areas than just the price. And in these times of crisis, this advantage can be worth gold!
- Focus on your Resources for Greater Efficiency
It is obvious that by concentrating its resources, it is easier to obtain results than actions scattered over many territories. By way of illustration: instead of simply using a generalist brochure as a communication medium for your entire potential market, it will be easier to invest more for more impact on a smaller target.
How to do Market Targeting?
- Identify and Analyze Targets
This phase requires an excellent knowledge of its market. It can intervene after a market study. As for any strategic analysis, the reflection will focus on two axes: attractiveness and assets.
For the attractiveness, we will look at the potential of the segments, their growth rates, competitive intensity … Regarding the assets, we will focus on comparing its strengths to the requirements of the segments. In particular, its ability to compete with the competition in place or future, the image of the perceived company, the relevance of its product offer and future developments … It must also be verified that the investments to access this segment are consistent with its means.
- Choose your Segments
The choice will be on the formula for which the company can present real competitive advantages. You do not have to look for the most important segment in terms of potential. Holding a strong position in a smaller segment is often more profitable.
But also risks
To serve exclusively a given market perimeter is to increase its dependence. In the event of a drop in demand or the rise of vigorous competitors, it will be difficult to backtrack. These signals and risks are to be taken into account in segment analysis.
Large companies have multi-specialization strategies, that is, appear as specialists for each segment. With the means in their possession, they can be formidable competitors.
Some markets, especially industrial ones, tend to demand suppliers offering global solutions. Choices dictated for various reasons: a single interlocutor, a rationalization of suppliers, and stronger accountability of partners. The specialist will then have more difficulties to win.
Conclusion
Marketing targeting generates many opportunities. But like any decision, we must analyze the opportunities and constraints of today, but also those of tomorrow.
Hello everyone! This is Richard Daniels, a full-time passionate researcher & blogger. He holds a Ph.D. degree in Economics. He loves to write about economics, e-commerce, and business-related topics for students to assist them in their studies. That's the sole purpose of Business Study Notes.
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