Shop Talk: Practical answers for tough business questions
Question: I am applying for a small Business Administration loan to start my store, and they want me to submit a marketing plan that states my local demographics and who my target customer will be. I am finding this hard to do. We plan to appeal to all ages from young children to adults and men as well as women, so how do I narrow this down?
Answer: Rest assured your store can (and likely will) appeal to all ages and genders if you have a good mix of merchandise. Creating a target audience profile does not exclude young children or 80-year-old men, it just defines the characteristics of the majority of your anticipated customer base. Making purchasing decisions based on your primary customer demographic enables you to buy better and allows customers to feel more comfortable, because they can figure out what you are about and easily share that information with friends.
A restaurant where I live, one of my favorites in fact, serves healthy, mostly organic, delicious food, but it is not thriving. I think the main reason is they have an identity crisis. They attract health-conscious customers because the choices are fresh and locally grown, but their décor is more like that of a sports bar with three televisions mounted on the walls. Curiously though, they do not serve any alcohol. To top it off, they are open unusual hours for a restaurant. Can you see why customers have a hard time trying to figure out their brand? Attempting to be all things to all people can leave you without a definable focus and that makes customers uneasy.
For instance, if you decide your target customers are women ages 35 to 65 and purchase advertising and merchandise accordingly, those customers will not only purchase for themselves, but for their children, husbands, and employees, who will, in turn, come in and make purchases for others. So in the end, you are excluding no one, while at the same time creating a distinct niche that will serve you well as your business grows.
First published in Vol. 27 No. 5 of Retailing Insight. © 2013 Continuity Publishing Inc. All rights reserved.