Not quite clear on who your target customers are?
In this video Joel Gerschman walks you through the 4-Step Niche Matrix worksheet which will help you clearly define your most profitable target markets.
To help you make strategic choices about your target market, I’m going to get you to fill out what we call your niche matrix, which you can find on the second tab of your strategic planning template. And it looks a bit like this.
Let’s explore it in a bit of detail together.
You’ll see that to complete your niche matrix, you’ll have to work through four key steps.
Step number one is your products and services. Down the left side of the page, you list all of your products or services including the ones you don’t currently offer, but may want to offer in the future.
Number two, you list your customer groups. Along the top of the page list the various customer groups you currently serve, as well as those you could or may want to serve in the future.
To help you identify different customer groups, remember to keep in mind two broad customer characteristics.
First of all, there are demographic similarities. For example, if it’s a business, if it’s B2B, then it’s industry, specialty, number of staff, revenue location. Or if it’s B2C then we’re talking about things like gender, occupation, education, income levels, social class, marital or family status, ethnic background, and so on.
The second key characteristic is what we call psychological similarities. These are things like values, aversion to risk, behaviour, personality, attitude, lifestyle, interests, and so on.
Number three is to consider your geographic scope. As you list your various customer groups along the top of the page, remember to specify their locations whether by suburbs, city, state, or country.
Finally step four, is to evaluate and ultimately decide on your niche. The key is to determine which customer product geographic combination will form your niche.
Now, how do you make that assessment? How do you decide on your niche?
Here are some questions to help you assess your choices:
Then your task is in light of that evaluation, is to write a number one in the box that best fulfils those criteria. That is what we call your target market, your niche, then put a two and a three in the next two most lucrative markets. They’re your flanker markets. And you can continue, you can add a four and a five and a six, if you like, but at least identify the top three. They’re going to be your most critical markets.
Now, it’s really important to realise, that your target and flanker markets at this point, are simply an educated guess, unless you’ve done some market research to verify your assumptions. And that’s why your next step (ie. before you start running Google Ads), is to verify your thinking with some simple market research. As a starting point, I’d like you to verify who your best customers are right now. What are their demographic and psychological characteristics?
I’m often surprised by how often businesses don’t quite know who their best customers are. And to find this out, one simple and powerful ways to use a basic customer survey. And there are a range of platforms out there that you can use for this. And we’ve added an example in the notes that you can utilise. And the idea is, to send that out to your current customer group, to find out a bit about who they are.
Once you understand who they are, you can have a much better picture of who’s buying your products or services. And as a result who your best customers are. And to maximise take up, you can add a small incentive like for example, a voucher for your store in order to maximise the chance of them fulfilling the survey.
And there you have it, that’s your target market process. Quickly summarise your steps.
I really hope you enjoyed this training video. If you did, and you’d like to access the full eCommerce growth engine course click here.
If you need help finding your target market and building a cohesive marketing strategy, get a no strings attached 30 min digital marketing strategy session here.