Section 3A - Target Market and Branding
- Section 3A focuses on the target marketing and the branding of the business.
- In this section, you will be required to research the target market and the target market competition. You will also be required to create the branding for your business, as well as your logo for the business. (Amy’s Fashion Boutique)
Market Segmentation
Market segmentation is a process of classifying and categorising different customer groups into different segments. A segment therefore is a group of customers who share one or more similar characteristics, and therefore have similar product/service needs.
Segmenting a market will identify a target market for your business (Amy’s Fashion Boutique). This specific market will there be what the business's products and marketing activities will be designed for. The design of the product and marketing activities is important, as it will allow product differentiation, specific to the needs of the target market. Furthermore, the positioning of the products can be identified, as it will further create a brand image for the business.
Target Market
A target market is a group of consumers or organizations most likely to buy a company’s products or services. Because those buyers are likely to want or need a company’s offerings, it makes the most sense for the company to focus its marketing efforts on reaching them. Marketing to these buyers is the most effective and efficient approach. The alternative - marketing to everyone - is inefficient and expensive. Targeted marketing identifies an audience likely to buy services or products and promotes those services or products to that audience. Once these key groups are recognized, companies develop marketing campaigns and specific products for those preferred market segments.
Target market can be segmented into various components. The four ways of segmenting markets are:
- Geographic
- Demographic
- Psychographic
- Behavioural
Geographic segmentation
The target market can be segmented by a means of location of your potential customer. Your target market may be segmented in terms of:
- Region
- Urban, suburban, rural
- City size
- County size
- State size
- Market density
- Climate
- Terrain
Depending on your type of business, choosing a certain location may be beneficial.
For example: a cafe would be suitable for a urban location due to the large amount of pedestrians.
Demographic Segmentation
Demographic segmentation is an important component in identifying your target market. This will identify the potential customer you will focus on in regards to your marketing and designing your product.
Demographic variables include:
- Age
- Gender
- Race
- Ethnicity
- Income
- Education
- Occupation
- Family size
- Family life cycle
- Religion
- Social class
Depending on your strategy you wish to use for your business (Amy’s Fashion Boutique) , will shape what demographic you will reach out to.
Behavioural Segmentation
Behavioural segmentation consists of dividing potential customers into groups on the basis of the knowledge, attitude as well as the use of the products, as well as their response to certain attributes of the products.
Behavioural segmentation also looks at the frequency of use.
Frequency of use
How often a customer uses a product is important, as different products have varying uses, from consumables to long lasting goods.
Psychographic Segmentation
Buyers are divided into different groups based on their social class, lifestyle, as well as personality attributes.
Futhermore, Social class may have an influence on a person's preferences for cars, clothes, home furnishings, leisure activities, reading habits, hobbies etc.
Customer lifestyle
customers have different lifestyles, in which may influence the type of target market you wish to aim for. Some customers may have an outgoing lifestyle, while some others may have an active lifestyle. Depending on the type of business and product you wish to sell, may have to be designed around this type of segment.