How to Define and Analyze Your Target Market

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Commercial or business activities are like a double-edged sword. Because if it goes well, business can be a promising source of income and create jobs for people around. However, business is also like a lottery that cannot be predicted by market conditions and competition within it.

Therefore, in running a business, a mature strategy is needed starting from company branding, the type of digital marketing used, the intended target market, the products produced, to the Retargeting and Lead Generation strategies that are implemented.

Of all the important aspects of doing business, the Target Market holds a crucial key to ensure that every product produced is suitable and accepted by potential customers. The target market also plays a large role in ensuring that the way to build a digital marketing strategy is good and appropriate.

A business that already has a Target Market with good company goals and objectives, the promotion strategy can also be carried out more easily and with direction. So, the topic of discussion in this article will be exciting, Erzedka Friends. Because it will comprehensively discuss the Target Market of a business. Come on, see more.!!

What is Target Market?

How to Define and Analyze Your Target Market

The target market is a group of people who have the potential or who already have a tendency to buy a product or use the services offered by a business.

In understanding what a target market is, you must focus on segments of the population that have certain needs, preferences and characteristics that make them the right potential consumers. Then, only then can you determine whether your product fits the characteristics of that market segment.

By knowing who their true target consumers are, businesses can direct their product marketing resources and efforts efficiently, rather than trying to reach everyone without a clear direction.

As an illustration, an example of a target market is a McDonald's outlet that opened in a toll road rest area. Due to its location, McDonald's targets middle to upper income people who are on the go. So, the target market's need is to look for fast and filling food.

To attract the attention of its target consumers, McDonald's put up a cheap and cheerful menu banner. Apart from that, they also provide drive thru services to meet the needs of their consumers.

According to an economist named Kotler & Armstrong, the target market is a group of buyers or consumers who have the same needs or characteristics as the goal of company promotion. Literally, the target market is a group of people the company targets to market products according to the characteristics, specifications, and weight of the product itself.

So simply put, the target market can also be interpreted as potential customers who can be prospected and are suitable for using the product being marketed.

Why is defining the market important?

Determining the target market is basically important. Because by setting targets, business consumer targets will be clearer. With this, the business can be placed in the right position according to its targets.

Determining the target market means opening up greater opportunities for the product to be recognized optimally. So that sales can increase and the desired profit target can also be achieved.

Without a clear target market, the product may not be offered to appropriate consumers. This makes product marketing run slowly or even fail altogether. Therefore, it is very important to know the target market for the product you are aiming for when starting a business.

What is the benefits of target market?

What is the benefits of target market

To determine the target market that suits your company, you can consider several things including marketing psychology, vision and mission, goals and objectives, type of product or service, and the company's Unique Selling Point (USP).

As stated at the beginning of the discussion of this article, the target market has an influence that is related to marketing strategy. The marketing strategy can be executed optimally if the company has determined the potential target market in advance. Then, what are the other benefits of the Target Market? Come on, look at the next discussion below!

1. Target Market Benefits

The following will describe some of the main benefits of the Target Market as a strategy to identify the audience or potential consumers correctly.

2. Increase Sales Conversion

By having the right and appropriate Target Market, the level of product sales will increase. This is because the product is promoted and marketed to the right consumer groups and really need the product. In addition, by having a target market, it will be easier for companies to develop products that their customers really like. 

Not only that, the target market can also increase the number of loyal consumers so that the company's profits will significantly increase. This is reinforced by the fact that 65% of product sales profits come from consumer loyalty (groups of loyal customers who continue to subscribe to products on a regular basis).

3. Maximizing the Company's Cost Budget

If the product is marketed with the right target, then of course it can save the company's budget. In addition, marketing costs will not be wasted because the Target Market tends to buy products because they suit their needs.

Marketing activities carried out without a target market make the company target promotions to everyone. This can make the budget swell and wasted.

4. Creating Balanced Communication with Consumers

Companies that have a Target Market will not target communication to everyone. So that communication with potential customers can be established in a private and balanced manner.

You can establish communication through newsletters, feedback, testimonials, surveys, interviews, and other methods. Through the customer target market data that you have, the company can find out who are the potential customers who can be involved in this communication method.

5. Facilitate in Determining Marketing Strategy

The success rate of marketing activities depends on the target audience. By knowing the target market, the promotional content (content marketing) that is implemented can be measured and directed.

For example, if your target market is Gen Z with an age range of under 20 years, then a suitable marketing strategy is through content on social media Instagram and TikTok. It's different if your target market is housewives, then the marketing strategy can be implemented via Facebook and WhatsApp. This is in accordance with a survey result from The Asian Parent, where the majority of housewives in Indonesia access Instagram (95%) and WhatsApp (96%).

6. Can Compete with Competitors

Through Target Market, you can see specifically which competitors are offering similar products and targeting the same customers as you. So the next step is to try to find out and explore what competitors have to offer. Then, create a Unique Selling Point and the advantages of your product that competitors have not been able to provide.

In essence, through your Target Market it will be easier for you to look superior and find out the weaknesses of your competitors in the market.

7. Prevent Churn Rate

For Erzedka Friends who are new to the term Churn Rate, here's a brief explanation. Churn Rate is the percentage of consumers who stop subscribing to a product from a company during a certain period of time.

The higher the Churn Rate, the more detrimental the company will be. Therefore, through the Target Market, it is hoped that the number of loyal customers will increase so that the Churn Rate can be reduced significantly.

What are the type target markets?

So, after knowing what a target market is, now is the time for you to know the types so you can choose the right target. In general, the types of target markets are grouped into 3, namely:

  • Mass Market. Type of target market which means everyone. This means that business people do not need to apply special segmentation for their consumers. Because the products sold are general and intended for everyone. Examples are products for daily use such as toothbrushes, soap, and others.
  • Broad Market or Differentiated Market. A more specific type of target market. For example, soap products for men and women or shampoo for adults and children.
  • Niche Market. A narrower type of target market because it is related to special consumer characteristics. For example, sales of toothpaste products for sensitive teeth.

What is an example of target market segmentation?

What is an example of target market segmentation

So, we have come to an exciting discussion, Erzedka Friends. In this section, a case study will be presented on how to determine the right target market. Here's an example:

 Study Case


Products Offered

An Android-based application for home workouts or yoga with free (trial) and paid versions (starting from USD 3,5 – USD 15 per month).

Product Distribution

Marketed through Google Play with an ASO (App Search Optimization) strategy, Gateway Download on social media, as well as mobile billboard banners on popular sports websites.

User Behavior

1. Men and women of productive age who like to exercise.

2. Enjoys interacting with social media such as Facebook or Instagram (because later the application will also be marketed via the Download Gateway on social media).

3. Men and women with body weight above normal.

4. Men and women who are busy and don't have time to visit the gym or exercise outside the home.

Users' Purchasing Power

Upper middle class users with purchasing power starting at USD 3,5 – USD 15 per month.

Appropriate Target Market

1. Men and Women aged 17-40 years.

2. Men and Women weighing > 60kg.

3. Students, businessmen, men and women who are already working and have limited time to exercise outside the home.

4. Men and women who use high-end gadgets (4GB RAM and above) because the available applications have a fairly high size.

What are the ways to define a target market?

So, we have come to the main discussion, Erzedka Friends. In this section, we will discuss comprehensively about the right way to have a target market that is sharp on target. Come on, see!

1. Implement Marketing Funnels

The first way to determine the Target Market is through the Marketing Funnel. If you are still guessing what the Marketing Funnel is, here's a simple explanation. Marketing Funnel is a concept that describes each stage that customers go through before they finally buy a product. Through the Marketing Funnel, three important things in business can be resolved.

First, the Marketing Funnel can outline the customer journey in detail and descriptively. Second, the Marketing Funnel can identify the reasons why customers cancel product purchases. And third, the Marketing Funnel can simultaneously explain the number of Target Markets (aspects of quantity) in detail.

2. Implementing Aspects of the Marketing Mix

In the 4P Marketing Mix, there are four main components which include Product, Price, Place, and Promotion. Among the four components of the 4P Marketing Mix, there are two components that are suitable as a benchmark in determining the target market, namely "Place" and "Promotion".

3. Place

Place is a strategy for product placement or distribution in order to reach potential customers. By understanding the Place aspect of the Marketing Mix, Erzedka Friends can have an image of the Target Market that can be targeted precisely. The "Place" component itself is divided into four main parts, namely:

4. Intensive distribution

Intensive Distribution is a strategy that places products in as many stores (both small and large) as possible to make it easier to reach a wider market.

5. Exclusive distribution

Exclusive Distribution is a distribution strategy by selling products through official distributor services placed in each area or major cities.

6. Selective distributions

Selective Distribution is a distribution strategy by selling products only in certain agreed places.

7. Franchising

The last one is franchising. Franchising is a distribution strategy by selling products through a process of cooperation with other parties. The profit-sharing system is carried out by dividing profits according to the portion and the previous agreement.

8. Promotions

Another component of the 4P Marketing Mix that can help determine your target market is promotion. The promotion strategy consists of several key parts, namely sales organization, public relations, advertising, and sales promotion.

By understanding all the aspects that support a promotional strategy, you can more easily determine your target market. For example, if the product you are selling is more suitable for promotion through contemporary social media such as Instagram and TikTok, then you can use influencer endorsement services so that the product offered can reach a more targeted target market.

9. Using Analytics Tools

The growing development of digital technology has resulted in many sophisticated and qualified analytics tools to determine the target market. One of the most popular analytics tools today is Google Analytics.

Google Analytics has a variety of features and metrics that can identify the behavior and demographics of your customers. Through Google Analytics you can also find out the dominant gender and age so that the process of determining the target market is easier and more targeted.

10. Knowing User Behavior and User Persona

User Behavior is a strategy for obtaining and understanding consumer behavior data that is useful for product development. User Behavior can be analyzed through the Marketing Funnel which describes consumer habits when they purchase products.

While User Persona is related to User Demographics, namely describing potential customers based on age, gender, place of residence, occupation, lifestyle, and others. Data regarding User Persona can be found by Erzedka Friends through Google Analytics tools.

It is hoped that by pocketing data regarding User Behavior and User Persona, you can more easily identify your Target Market to increase business sales conversions.

11. Creating Brand Positioning

Brand Positioning is considered to play a major role in running a business because branding is a first impression that can create customer perceptions of the company's products.

In addition, a mature Brand Positioning can also help a company position its brand so that it is liked and glimpsed by potential customers. If a company is able to present a good Brand Positioning, then the Target Market will be easier to form.


The target market is potential customers who can be prospected and are suitable for using the product being marketed. The target market is needed in business because it can make marketing strategies run more optimally. In addition, the right target market can increase sales conversions, brand identity, loyal customers, and reduce the churn rate.

In order to have an appropriate Target Market, you need to deploy several strategies such as implementing a Marketing Funnel, Implementing Marketing Mix Aspects (Place and Promotion), utilizing metrics and features on Google Analytics, Knowing User Behavior and User Persona, and creating Brand Positioning.

Well, that's enough discussion this time about the Target Market. Hopefully this will be useful for Erzedka Friends, OK!

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