Is Your Target Market Viable?

February 3, 2009 at 5:24 pm 3 comments

 Cherry Pie Sliced

In small business marketing a lot of focus is spent on which marketing tactics to use and when and how to use them etc. We sometimes forget that using all the marketing tactics available to us will not grow a small business if the target market is not fully defined and viable.

Diane Helbig from Seize This Day Coaching wrote an interesting article on Small Business Trends showing how to use 4 steps to qualify sales prospects. She outlined a very simple process and showed how to define your target market.

Diane’s article made me think of one area that we sometimes forget to factor in and that is the impact of competitors. Too many competitors or too few competitors can determine whether your target market is actually viable for your business to enter and grow.

For example, I live near a beach, we have pretty good weather throughout the year and on any given morning you will see people exercising whether it is walking along the beach, going for surf, working out with their personal trainers. At face value if you were thinking of setting up a personal training business you could think this is a good market to enter.

Over the last few years this type of business has grown, with new personal training businesses starting up throughout the years. However if you really looked at the market you would realise it is now quite saturated with many competitors competing for an increasingly smaller market share. Perhaps that is one reason why over the last couple of years I have seen a number of small businesses start up and a few months later close.

If there are too many competitors, then your target market size for your ideal customers may be too small, especially if you do not have a relevant key point of difference. Also to attract your potential customers may mean you need to increase your marketing spend just to get a foothold.

If you find that there are very few competitors, it may mean that the target market demand for a product or service is just not there and again to create demand may mean considerable investment. The other side to this is that a market with only a few competitors can be difficult to enter or compete in due to the dominance of these businesses.

Finding out whether your target market is viable is not always easy; however it is essential to take into account your potential market’s competitors before you enter and spend your time and money.

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3 Comments Add your own

  • 1. mdepiere  |  February 3, 2009 at 7:14 pm

    I found this to be a very interesting post. You can have a great product and great price but if your market is not viable for you, then nothing will happen and you will fail.
    Good job!

    Reply
  • 2. John  |  February 4, 2009 at 5:56 am

    Very insightful post. Just because the desire for your product is there doesn’t mean the demand for your product will be.

    Reply
    • 3. Susan Oakes  |  February 4, 2009 at 7:13 am

      John and mdepiere, thanks for your comments and you both make good points. Too often we look at the total size of a potential market which is misleading. Another point is that your potential target market can change in size and viability over time so you need to keep a close watch.

      Susan

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