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One of the keys to success in business and, for that matter, in life is the ability to recognize your mistakes and fix them.
When it comes to choosing and focusing on a target market, I often see business owners fall into two extremes.
On one end they are all over the place and going after whatever and whoever in the hopes that something sticks. They aren’t focused on a market, industry or segment. And they are spending money and not gaining traction.
The other extreme is that their target market isn’t broad enough to support and sustain their business. They are too narrow in their efforts. They aren’t diversified. They are too dependent on any one industry or customer. If something changes and a specific company no longer needs their services, for example, they are scrambling. Being too myopic in your target market can have broad consequences. Take oil and gas. Many businesses focused on that industry have suffered because of recent unforeseen market fluctuations. To avoid getting caught with your pants down, you have to be diversified appropriately.
The goal is to leverage your expertise, but not spread yourself too thin. Balance = harmony folks!
As business owners, you have to be honest with yourself about your vulnerabilities and where your strengths are and how you can get better.
Here are some tools, tricks of the trade and partners you might need:
1. One of the tools to do this – and to discover if your market isn’t defined or broad enough – is a SWOT (Strengths, weaknesses, opportunities and threats) analysis. A SWOT analysis will help you self-assess and see around corners.
As I mentioned in a post earlier this month, your CPA can help you run your business more effectively if they take a broader role. In this broader role, they will be more integrated into your management team and spend some of their time analyzing the money. This, in turn, will mean that they will have helpful stats that will help you understand your revenue. This understanding will help you determine if you’re focusing your attention and your investments in the right direction for the maximum bang for your buck.
2. Sometimes to get into a new market you need to hire someone with expertise and connections in that space. For example, you may need to hire a marketing expert to redo some of your marketing materials to get into that space. Check out a recent guest blog post on marketing by Valerie Hausladen of Magnetika.
3. Finally, analyze the characteristics of your customers so you understand exactly who buys from you.
All of this is critically important: having a clear target market enables you to be much more effective and efficient in both your product development and marketing efforts.
By Blair Koch
