How to choose a TARGET MARKET

When planning a business project, you'll hear many people say - FIRST pick your target market!

But WHO should you pick as your target market?

Rule ONE: They should have money they can spend!

While a business CAN help people and improve society, to survive you gotta have sales, and to make sales you need a target market with "disposable" cash.

It's simple mathematics - they can't pay you if they don't have the money to do it with. So without a doubt, rule number ONE is choose a target market with disposable cash.

Unless you get PAID, your business project has no hope of survival. (That's the difference between a "hobby" and a "business".)

It's good to help the "down and out" if you want, but you have to be sure that you are targeting those with money to pay for it somehow.

To take an example, let's say you want to help the homeless through your business. You're not going to succeed by trying to sell the homeless expensive "biz-opps" - they can't afford it.

A better way might be to help organize those in need to provide a service (such as a gardening or lawn-mowing service), so that all of you get a cut of the profits. That way, you are still helping the needy, but it is those with disposable cash (who buy your services) who are paying for it.

It is a REAL business, one where you still help others and which could also have a real chance of success. That's just an example of how you can apply this principle to help others, THROUGH a business.

Sandy wrote a post here a few months ago about a furniture moving business that employed ex-convicts - to help them "find their feet" again in society. That's another business like this....

You have to remember that, whatever the business, your target market MUST have some disposable cash. It doesn't mean you can't still help those who are "down and out" - but just that to do so you'll have to be a little more creative....

A SECOND rule is.... It usually helps to pick a market you understand.

Either you have dealt with that the kind of people who form that market extensively before, or....

YOU are just like the kind of customers you are targeting.

What that means is, if you are a woman who loves gardening, what product or service could you offer to people just like you, who also love gardening? These kinds of products are easy to think up, since you just have to think what kind of product or service YOU would like to have yourself.

We all have thoughts like, "There should be a ___________" or "Someone ought to make a ___________".

STOP

and write it down! Those are possible business ideas!

If you really understand your market, it makes your work much easier and you are more likely to succeed, since you are more likely then to provide a product or service that people really want or need.

Why make things more difficult for yourself than things need to be?

And anyhow, dealing with people who are just like YOU are can be fun. :)

THIRD - is your market big enough to sustain you? It doesn't have to be very big, but you want to be sure it is big ENOUGH.

Now, because of the global reach of the internet, markets which were "too small" before are big enough NOW to create a successful niche business.

The internet is like "manna from heaven" if you want to create a niche business!

Well, there's a few thoughts on choosing a TARGET MARKET.... Any more?

- Dien Rice