“Always make it a point to know who you’re baking for.” This is what Paul Kyomukama of Cake and Cakey had to say among other things when asked for advice to novice bakers in an interview we had with him early this month. Your target market in simple terms being who you’d be baking for in this instance. A set of individuals sharing similar needs or characteristics that your company hopes to serve. These individuals are usually the end users most likely to purchase your product. The ability to identify one’s target market is a defining factor in growing a successful brand in the future. Once you know who you’re targeting, it is much easier to make important decisions on product, price, place (location) and promotion (marketing) by focusing on the needs, wants and motivations of those most likely to purchase your product and crafting messages that appeal specifically to them. Coca Cola and Riham Cola probably don’t have the same ideas of who their target markets are and hence will have different marketing strategies in their effort to appeal to the differing tastes and preferences of their respective target audiences. It would therefore be in your best interest as a novice baker to tailor your product(s) in accordance to your target audience’s interests once you have identified them from the populous.
Determining your target market
Although it may be time consuming up front, determining a target market allows you to focus your marketing efforts in the most cost effective way possible. Begin by clearly defining your product or service and then defining the kind of person or business that will want to consume what you have to offer.
- Growing your target market
With the evolution of data science, big brands are using scientific methods, processes, algorithms and systems to extract information and insights from structural and unstructured data provided by their clients with or without their knowledge in order to narrow down their clients’ tastes and preferences to create highly personalized marketing campaigns with the aim of improving customer experience hence gaining a loyal trusting following.
This is how YouTube tends to always recommend videos pertaining to the subjects of your previous searches. Now, it is safe to say a novice baker like yourself doesn’t enjoy even close to the same luxury of data collection and market research brands like coca cola and YouTube enjoy, so how would one go about building onto the number of individuals most likely to be seduced by his/her product in today’s competitive market environment.
- Wallet Share/Share of wallet vs Market Share
Everyone has preferences. Some people like Coca Cola; others like Pepsi. There’s those that prefer Riham Cola instead. For consumers, there’s no shortage of choices, but there’s a limitation of money. People pick and choose brands they rely on, and will allocate portions of their budget to companies they trust. This metric is called “share of wallet,” and it helps brands determine how popular they are amongst their competitors. How much a specific customer spends on a brand relative to its competitors. Market Share on the other hand is the percentage of a market that a single company controls by revenue or number of customers; a metric that is usually enjoyed by already established brands and companies like the ones mentioned above. Acquiring new customers boosts market share while getting existing customers to spend more improves share of wallet. In light of that the novice baker will benefit more from focusing on improving his/her share of wallet i.e. turning already existing customers into loyal trusting supporters of your brand. Improving your company’s share of wallet can often be as simple as offering a broader range of high-quality products or borrowing from other companies. If a particular item is selling well for one of your competitors, you may consider selling your own version. That way, your target market will be less inclined to spend on a competing brand because they can get the same product from a provider they know and trust.
Increasing your share of wallet can be as reliable and profitable as trying to bring in new customers. That’s why businesses often focus on increasing their share of wallet for repeat customers as much or more than winning new ones. Try finding the common interest the majority of your clients possess & use that to steer the ship, thank me later!