Specialists dependably say search for the pain areas and build up a business out of it. When you recognize one pain area and consider converting it into business. At this point you will consider those individuals to whom you are going to provide the resolution.
If not, then you are taking a very big risk for your business as it is very possible that it would down the path of your business and that it may not make survive in the market. Before you jump into the market, you must identify the market segment that your product is made for. Otherwise, you will end up with focusing on the unwanted individuals.
You can ask yourself, why am i building up this product or service? And for whom am i developing this product or service? You need to have a very clear response for both of these inquiries. Record everything that strikes a chord and try to visualize who will be those individuals I am making these products for, taking general categories of people and narrowing it down as much as could possible to be clearly identified to those niche people.
Here are few suggestions to find your Market Segment:
Segregate it by Geographical Locations i.e.
- What nation do they belong to?
- What city do they belong to?
- Are they Urban or Rural People?
Filter it by Demographics i.e.
- How old are they?
- What is their family size?
- What is their Gender?
- What is their income status?
- What is their Education Level?
- What Occupation are they in?
- What is their Religion?
Another factor you need to consider while doing this exercise i.e. Behavioral Activities
- What is their Interest Level?
- What is their Attitude?
These activities help for identifying the desire market segment that is required for your business, you will be stunned of the outcomes and by then you can clearly visualize those people. These outcomes will also help you to choose the amount of money should be invested to contact those people and how soon it will get the outcomes, which will also help you to choose if that market is big enough to contribute and maintain for long.
Now deep down little further and try to identify one person out of it, to whom you are going to sell your product. It’s sounds silly but it has very big impact on your business down the lane. If you able to satisfy that one customer with your product or services, it not only gives you moral boost but also creates lots of opportunities for those people, for which the product or services was built for. It’s a proven formal and followed by many startups.
Let’s discuss two examples here;
When Mercedes launched their products into the market, they brand themselves as a premium brand in making luxury cars and their target market segment was those people who have a very good social status and financially rich. That’s the target market segment they have identified and based on that, they built the products which satisfy those customers. For Mercedes, their Target Market Segment was Financial Rich People.
Airbnb launched their products focusing on those clients who are searching for modest rooms with reasonable costs and on the other side, people who are interested to share their rooms to strangers on rent premise. So basically their target market segment was people who are searching for cheap rooms and people who are interested to share their rooms on a rent premise. That gave them enough business opportunities to develop their products and bring it to the market.
I hope you understood why it’s very crucial to identify your target market segment. Proper brainstorming is required to find your target market segment. If you cannot do it, then find a consultant that can do it for you. Don’t proceed further unless you have this data with you.
Once you have identified those people, the next step is to identify the market size which will give you the tentative data and how much money you can make from that market segment and how maintainable that market is, with respect to your product or services
In my next article, I will be discussing the Market Sizing and Market Potential.
Hope this piece of information will enhance to your startups.