Title: Target Market Identification | Small Business - Chron.com
Headings: Target Market Identification
Target Market Identification
Characteristics
Importance
Process
Considerations
References

Content: In contrast, a company that does not define its target market narrowly could end up with promotions and products that do not fully meet most customers needs. Further, when a company fails to establish a target audience, it does not give itself the opportunity to compete directly with its competitors, such as the laptop company that comes on the market offering a super low cost laptop. In this case, because it did not try to address any specific needs other than cost, cost becomes its only basis for competition and likely its eventual undoing. Process
Companies determine who to target by looking at segments of the population and comparing them based on their size and relative growth. A good example of this is examining age groups, although segments maybe identified through a combination of factors, such as single professional female. Next, companies look at each segment’s attractiveness. To use the example of the coffee shop, a neighborhood may have a large concentration of high school and college students, but if that population is not likely to stick around, targeting students could be a mistake. Older people may start to classify that place as a place students hang out and choose a different coffee shop to frequent as a result; when the students move away, the coffee shop would have to try to win back its older clientele; clientele that may have already developed a strong preference for another coffee shop.