How to Use Market Segmentation in Reaching Your Target Audience?
Whether you're a print on demand entrepreneur or a service supplier, a targeted approach to this market is essential. Companies must implement segmentation by dividing potential customers into similar interest groups to engage their target audience successfully. By focusing on specific segments, you’ll better understand your customers and regulate the differences between products and their value. Ensure your solutions meet or exceed unique needs so then your conversions will go up.
You may be the best print on demand manufacturer of chintz dresses, but you'll most likely have problems selling it in Antarctica. That comparison applies to any product whose life cycle is essential to find the right target market. That's what market segmentation is for. Such a marketing strategy will determine how to reach a specific client with the right product or message.
Let's take a closer look at what segmentation is, and its connection with the target audience is.
Table of contents
What is market segmentation?
Market segmentation is the process of breaking down potential customers into different groups (segments) for relevant requests to provide targeted marketing efforts.
Let's assume you're selling a hoodie. The demographic segments of your audience are men, women, and children. You can also define their geography using the Google Trends tool. As you can see, the most significant number of requests is concentrated in New York, Philadelphia, and Detroit.
In Tampa and Jacksonville, it’s clear that such a product holds little interest. Nevertheless, given that the hoodie has become an everyday wardrobe item that everybody has, segmentation enters into force according to other signs.
To understand what different members of your target audience have in common, let's look at the most prevailing types of breakdowns.
Typically, changes in demand, desires, and needs are closely related to demographic variables. Let's take an age indicator. To master different age segments, some brands develop various products and marketing strategies. E.g., one of the most successful shops on Shopify is Classic Dad, whose name speaks of specialization in products for men who became fathers. Accordingly, the target audience age can range from 18 to 60 years old. Occupation is also essential: in this case, it's a promotion of the fatherhood culture.
Interestingly, the brand has also built its marketing strategy around demographics. It created the Lawn Whisperers web series, Super Bill Halftime Show, Duck Tape, launched the Kingsford Charcoal Super Bowl Promo, is heavily involved in social media, etc. All of these activities generate over 40 million monthly views across multiple platforms.
- Market spread range: global, national, regional, local
- The region, a significance of settlements (e.g., cultural capital or resort town)
- Cities urbanization
- Population size
- Climatic conditions
- The likelihood of natural disasters
Circle square diamond was born back in 2013 when Reddit became the first place to sell trail maps as a work of art. Soon sales grew, an owner created a Shopify store, and now the distribution range of its products has reached the global level.
- Place and frequency of purchase
- Purchase benefit (savings, speed)
- Attitude to the product (loyalty, indifference, denial)
- Purchase drivers (price, quality, service level, delivery)
- Reason for making a purchase (everyday event or holiday)
- Expected result
- Buyer status
- Involvement degree
When We Rate Dogs monetized through a Shopify store, it became viral. Behavioral factors played here a key role, namely, users' love for dogs (purchase driver), gratitude to people who donated money (expected result), the ability to selflessly help animals (customer status), etc.
As you can see, segmentation helps develop a suitable strategy for a specific group of people and satisfy their needs for a particular product.
What is the connection with a target market?
In an ideal business, you could sell your products to absolutely everyone. But since this is unrealistic, it turns out to be more enjoyable. In most cases, only an ideal target market segmentation is triggered. So a couple of retirees won't be interested in sustainable organic diapers, but they'll need comfortable shoes, light clothes, hats (if they live in sunny Florida), etc. Thus, brands must identify a specific group of people, called a target market, who are more likely to buy their products.
Target markets resemble a large lake, where each fish reacts individually to the bait and has different preferences. Therefore, in the POD business, it's vital to correctly and effectively convey your marketing messages.
Thus, there is an STP marketing model that includes segmentation, targeting, and positioning. It’s a fairly standard approach in modern marketing, which is inferior to the SWOT/TOW analysis matrix. It's audience-oriented, not a product. The last one is merely a means of delivering a relevant message to a commercially attractive audience. STP has a direct bearing on digital marketing. So, according to “Smart Insight” by Dave Chaffey, each stage of targeting in marketing has its source and carries a specific message.
Source: market analysis and user data
Actions: define customer needs and implement essential characteristics for each segment.
Source: demand analysis
Actions: assess the potential and commercial attractiveness of each segment.
Source: competitor research and internal analysis
Actions: develop careful product positioning for each of the groups and the marketing strategy selection.
We have already analyzed the market segmentation earlier, so we'll focus on targeting. To do this, the company must have a budget. E.g.:
- The search query intent includes the ability to compare products that are attractive to the user.
- Targeting based on social media interests
- Consumed content personalization (email newsletters)
The last element of STP is creating positioning maps, that is, assessing a market opportunity.
This graph illustrates the possibility of analyzing the current market position based on the distribution of competitors in the matrix and factors influencing the purchase.
Why concentrating on a target audience?
By focusing on each market segment, you’re getting even closer to perfecting and implementing the company's growth strategies. The segmentation benefits for the target audience are apparent:
- You'll learn more and take better care of your clients. This way, providing the most adaptive, unique, and personalized solutions will benefit and solve their problems. Utilizing a customer portrait, implement effective targeting marketing, optimize your store, assortment, and even staff work.
- Understanding the market improves workflow productivity for the business owner, which will impact SLA compliance and mailing optimization.
- Applying industry knowledge to integrate unique solutions into your workflow increases conversion efficiency and gives you a competitive edge. E.g., discovering demographics or markets that entrepreneurs or their competitors haven’t previously served allows them to become pioneers. That's the key to any business success.
Segmentation of the target audience avoids stereotypes and mediocrity. It makes your marketing efforts more targeted or personalized.
By understanding the different segments of your target audience, you can create a customer profile and focus all your efforts on product development, launching ad campaigns to hit your target. If you make your content applying segmentation, you’ll attract more prospects to convert into customers. That bodes well for your brand loyalty in the long run. Conversely, if you don’t use target audience grouping, most likely, your customers will be like a faceless mass. That will lead to brand rejection. So take the time to segment and create only personalized messages that will please your audience.