Founders, take note: Just having a great product or service to offer is not enough to make a sales team successful. You need to know exactly who is willing to pay for that product or service and the best ways to reach them.
This is especially true for startups, where you may have a brand new product or service that is just getting established and lack the resources to waste on leads that go nowhere.
I’ve been the founder and president of the Growthink family of companies since 1999. In this article, I’ll explain how startup companies can identify their target market and sell to them effectively.
Table of contents
- Why you need to identify your target market
- 6 steps to identify your target market
- Selling to your target market
Why you need to identify your target market
To put it plainly, you need to know who wants to buy your products and services.
Understanding exactly who your customers are can save your company a lot of time and money. Gathering as much information on your target market as possible is a necessary part of setting your sales team up for success.
If your startup is considering investor funding, identifying your target market is also important. You will need to share who wants to purchase from your company and how you plan to reach them when writing your business plan from scratch or completing a business plan template.
6 steps to identify your target market
1. Know what you’re selling
This one may seem obvious, but really understanding your products and services is a major first step in identifying your target market.
Ask yourself these questions:
- What exactly am I selling?
- Which features make our products and services unique?
- Are there pain points that our products and services can address?
Once you have a good handle on what your business offers, you can start to identify the types of people who would be interested in purchasing it.
2. Make some general assumptions about your target customers
Now that you know what you’re selling, it’s time to make some assumptions about the types of people who would be interested in your products or services.
When you first begin identifying your target market, you may have to make some broad generalizations about who you think your customers will be.
Maybe you know that individuals who work in a specific industry or live in a particular geographic area are more likely to become customers.
Start with these high-level details and begin to work your way down into more-specific features as you gather data. The customer features that really matter will depend on your specific business and whether you are a B2B or B2C company.
If you are selling to other companies, you might consider:
- Job title
- Purchasing power
- Company size
If you are selling to consumers, you might consider:
- Income level
Over time, you will begin to notice which features are most common among your customers and can begin customizing your outreach to target those individuals.
3. Research your competition
Part of understanding your target market is understanding what other companies are doing to reach it.
Take advantage of your competition’s target market research: Take a look at their marketing materials and sales strategies.
Your competition may have already spent a lot of time and money identifying their target markets, so take advantage of that by doing some research on their marketing and sales strategies. Look at their website, social media channels, and any other marketing materials they produce.
Consider the following:
- Who is your competition targeting with their marketing?
- What messaging is your competition using?
- What channels are they using to reach their target market?
- What seem to be their most successful marketing tactics?
Figuring out what your competitors get right (and wrong) can help you make better decisions when selling to your target market.
4. Analyze your engagement
As your startup business grows, it is crucial to have tools such as Google Analytics set up to gather as much demographic information as possible.
This data will help you uncover who is clicking through your website and what content is getting the most traction. You can gather similar data from ad clicks, social media post engagement, and other sources.
Look at your engagement data to see which leads are interacting with your brand and where they are coming from. This will give you some clues as to who is interested in what you have to offer and how you should approach the sales process.
5. Create personas
Once you have gathered all of this information, it’s time to start putting it together into customer profiles, or personas.
These should be semi-fictional representations of your ideal customers, based on the data you have collected.
Creating customer personas can help you and your team understand your target market on a deeper level. You can use your personas to guide your marketing and sales strategies moving forward.
When you are creating personas, be sure to include:
- Customer characteristics
- Job titles and duties, if applicable
- Key demographics
- Interests, hobbies, or motivations
- Pain points they need solved
Remember that your personas will be unique to your company and what you are trying to sell.
6. Keep learning and changing
The process of identifying your target market is ongoing. As your business grows and changes, so too will your target market.
Be sure to keep track of the data you collect and use it to regularly update your customer personas. This way, you can be sure that your sales and marketing efforts are always aligned with the needs of your target market.
Selling to your target market
Identifying your target market is only part of the process, of course. You still need to sell to those potential customers.
There are a few strategies you can use to effectively make sales to your target customers, regardless of your team size or sales processes.
1. Adjust your messaging
As you create marketing and sales materials, always keep your target market in mind. Use the language that they use to describe their needs and problems. Speak to their specific pain points and show them how your product or service can provide a solution.
2. Build relationships
In order to make sales, you need to build relationships with potential customers from your target market. This starts with your initial outreach and continues through the entire sales process. Get to know them as people, not just as leads. Find out what motivates them and what their buying process looks like. The more you know about them, the easier it will be to sell to similar customers.
3. Consider strategic partnerships
If you are having trouble reaching your target market, consider partnering with another company that already has a relationship with them. This could be a company that sells complementary products or services, or one that is targeting the same market. This type of partnership works best with two companies who share a target market but offer different products or services to that market.
4. Choose the right channels
Not all marketing and sales channels will be equally effective in reaching your target market. Consider where your target market is spending their time online and offline, and focus your efforts on those channels. If you are selling to businesses, for example, LinkedIn may be a more effective platform than Facebook.
The process of identifying your target market may take some time, but it is crucial to the success of your startup business. By really understanding who you are selling to and what they need, you can create targeted marketing and sales strategies that will help your sales team reach its goals. Just remember to gather as much useful data as you can and apply what you learn to all of your sales efforts.
Edited by Kendra Fortmeyer @ Sales Hacker 2022