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Business Insights

How to Identify your Target Audience as a Small Business

Frank Dowie
6 Minutes to read
Marketing a small business comes with many challenges. How can you ensure you are targeting the right people with the right messages? Since defining a target audience is fundamental to marketing strategy success. Review our quick guide to learn more about what a target audience is, why defining it is important, and how to identify your target audience. 
Marketing a small business comes with many challenges. How can you ensure you are targeting the right people with the right messages?
 

Since defining a target audience is fundamental to marketing strategy success. Review our quick guide to learn more about what a target audience is, why defining it is important, and how to identify your target audience. 

What is a target audience? 

A target audience is the group you believe is most likely to want your business’ product or service and will become a paying customer. This group is comprised of individuals that you want to reach with your marketing efforts. 

Depending on your company, your target audience might be based on demographic factors like: 

  • Age 
  • Gender 
  • Income level 
  • Job title 
  • Geographic location 
  • Interests/hobbies 

 

It can also be based on psychographic information: 

  • Behaviors 
  • Attitudes 
  • Personality types 
  • Lifestyle or communication preferences 

Target Audience vs. Target Market

Sometimes people use the terms “target audience” and “target market” interchangeably, but there is an important distinction.  

  • Your target market refers to the whole group of people that may be interested in your business’ products and services. 
  • Your target audience is much narrower; it’s the specific group within the target market that is most likely to buy your product or service. 

Diving deeper into your target audience will enable you to create more targeted marketing. 

Knowing your target audience

Understanding your target audience can help you maximize your marketing efforts’ impact and minimize waste. For example, would a billboard ad in Times Square attract plenty of eyes to your new product launch? Yes, but it’s 1) expensive and 2) may not reach the people who actually have interest in buying from you. 

By knowing your target audience, you also know where to find them – the channels they use most often and what types of marketing work best to reach them. If you sell kitchen tools,  an ad in a cooking publication may make sense. If you operate a dog training school, a partnership with a pet supplies store or a sponsored social media post from a local animal shelter may be effective. Understanding your target audience and therefore locations where you can reach them is key to ensure every marketing dollar spent is maximized for your investment. 

Further, being familiar with the roles that exist within your target audience – e.g., decision makers, supporters, gatekeepers, etc. – can help you to build relationships and craft proper messages to the right people. Consumers feel most understood when they are contacted with messages that feel personalized specifically to them and their needs. Identifying your target audience helps ensure you are truly connecting with your customers.

Methods to identify your target audience 

1) Analyze your customer base  

If you are wondering who is the most likely to buy your product or service, take a deeper look into your current customers. By analyzing the characteristics of your existing customer base by sending out a survey, conducting client interviews, or identifying themes and patterns, you can begin to understand the target audience to focus on. 

2) Understand the market 

Conducting market research can be a useful way of understanding industry trends and where your product or service might fit. Are there needs or pain points that your offering can fix? Who is the audience that is looking to solve for those things? 

3) Conduct a competitor analysis  

Part of understanding the market also means looking at your competitors – who are they? What are they selling? How are you differentiated? How are they reaching their target market? All these questions can help you identify the right people to target. 

4) Consider your product’s benefits – not just features  

Features are facts about your product. Benefits are about what those features can do for your target audience to meet a need or improve their life. When you think about benefits, you are more likely to pinpoint the audience who might be most interested in buying from you. 

5) Define who your audience is and is not 

If you are having difficulty defining who your target audience is, defining who your audience is not may be a helpful exercise. Who would not be interested in your product? Being specific may be useful – for example, “Women between 20 and 40 without kids would not be a potential buyer so should not be in our target audience.” 

6) Pay attention to trends in customer feedback  

One of the best ways to understand who might like your product or service in the future is to look at who already does or does not like it now. Take a look at the feedback you receive online (e.g. reviews, comments, emails, etc.) or what people tell you directly.  

7) Revise and update  

Markets shift. Businesses grow. Your products and services could change over time. Being aware of changes in your market, your offerings, or your customer base can help you quickly pivot to appeal to your changing target audience. By consistently revisiting your personas and updating them to match what you’re seeing day to day, you’ll be prepared to meet your customers where they are. 

 

 

To qualify for an SBA 7(a) small business loan, your business must be:

  1. U.S.-based and operated
  2. Owner supported / owner funded
  3. Eligible per the SBA’s requirements

Your loan amount will determined by the business’ average annual revenue, FICO score, and years in business