A market target strategy helps you focus your resources and grow quicker.

The market target strategy decision is a choice of the people or company in a product market that a company will target with its positioning strategy.

Selecting a target market strategy is one of marketing management’s most demanding challenges.

Should a company attempt to serve all people who are willing and able to buy a particular product or service? Or should you have selectively focused on one or more segments?  

You must study, through market research, the product market segment, it’s buyers, and the structure of competition in order to make the right market targeting decision.

 target marketing strategy

Targeting Strategies

Target marketing calls for three major steps. The first is market segmentation, the act of dividing a market into distinct groups of buyers who might require separate products and or marketing mixes.

The company identifies different ways to segment the market and develops profiles of the resulting market segments.

Should a company attempt to serve all people who are willing and able to buy a particular product or service? Click To Tweet

The second step is market targeting, the act of developing measures of segment attractiveness and selecting one or more market segments to enter. The third step is product positioning, the act of establishing a viable competitive positioning of the company and its offer in each target market.

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Companies are increasingly embracing target marketing. Target marketing helps sellers identify marketing opportunities better. The sellers can develop the right offer for each target market.

They can adjust the prices, distribution channels, and advertising to reach the target market efficiently. Instead of scattering their marketing efforts (like a “shotgun” approach), they can focus it on the buyers whom they have the greatest chance of satisfying (like a “rifle” approach).

market targets

Targeting Practices.  

Companies typically appeal to only a portion of the people or organizations in a product market, regardless of the market target strategy used. Marketing management may identify one or more specific segments to serve.

Alternatively, although no specific segment strategy is formulated, the marketing program selected by the company positions is so that the company appeals to a particular subgroup within the market. The former situation is obviously preferred.

Finding it by chance does not give management the chance to evaluate the revenue, cost, and profit implications of different segments.  At the other extreme, the task of selecting the very best target market is often impossible. It’s because of the product market complexity, research and analysis cost, and the difficulty of estimating the market segment response to a marketing effort.

When a segmentation strategy is employed. It should be by design and the underlying analysis should lead to the selection of a promising target opportunity.

It is possible to carry segmentation to an extreme which results in segments too small to be economically feasible. The most extreme form of segmentation occurs when each buyer is a segment.

In industrial markets, targeting of individual organizations may be appropriate because of their high buying potential. Management must evaluate the value and cost of different degrees of segmentation in choosing an optimal targeting strategy.

In industrial markets, targeting of individual organizations may be appropriate because of their high buying potential. Click To Tweet

Most companies adopt some form of market segmentation. During the last decade, buyers and markets have become increasingly differentiated as to their needs and wants. It is assumed that the product market can be segmented on some basis.

Emerging markets may require rather broad macro segmentation, into a few segments, or as more mature markets can be divided into several microsegments.  

It may be necessary for the emerging product market to advance to the growth stage before meaningful segmentation can occur. Market definition and analysis are essential to finding segments.

Targeting Alternatives.  

The targeting decision determines whether to go after most of the segments, only a few, or a single segment. A major company may decide to serve more than a single segment.

Management may select a few segments or instead seek intensive coverage of the product market by targeting all or most of the segments. The objective is to aim a specific marketing effort at each segment that management chooses to serve.

For example, Anheuser-Busch, the leading U.S. brewer with its multiple offering beer brands, target several major population groups within the total product market.

Some targeted groups are large, and they’re undoubtedly people who buy more than one of the Anheuser-Busch brands.

Acknowledging some overlap and population groups, the firm’s market target strategy is a segmentation approach, since different brands, prices, distribution, and promotional programs are involved.

Anheuser Busch Products

In large product markets, companies sometimes select market target strategies that offer buyers a variety of products.

On the surface, this appears to be a segmentation strategy, with each product offering a different appeal.  Yet these ‘variety strategies’ are designed to give buyers brand alternatives.

When a buyer desires a brand change, a switch can be made to another brand or product version offered by the same firm.

It may be difficult to distinguish whether a firm is using a segment some element of both strategies may be present. For example, the company may offer variety to buyers in a particular market segment.

Offering customers different flavors or varieties of food products are illustrations of ‘variety strategy.’ Mars, the company that sells candy bars, offers a wide variety of candy bars and illustrates the strategy. The variety strategy is popular in the food and beverage product markets.

Marketing a single segment.

This targeting strategy enables a company to focus its efforts on one group of buyers with similar needs. This is also called niche marketing. Single-segment targeting is appropriate for small firms with limited resources. The company can dedicate its total effort towards buyers in that target segment.  

Single-segment targeting may help a firm gain a competitive advantage more easily than if the firm tries to simultaneously target two or more segments. The disadvantage of a single target is the dependency on one customer group.

Often market attractiveness and competition may vary across market segments.  Single-segment targeting should focus on a segment with promise and an opportunity for the company to sustain a competitive advantage. The objective should be to dominate the segment.

Selective Targeting.  

This targeting strategy extends beyond a single segment to include a few markets.  Multiple targets expand beyond market opportunities and eliminate dependency on a single market target. Selective targeting is an attractive strategy when some of the positioning elements can be used for more than a single target segment.

For example, Mont Blanc pens, in writing instruments, uses a similar line of products to target upscale buyers and business purchase the pen for employee recognition perks.

Extensive targeting.  

This is also called mass marketing. The objective of the extensive targeting is to gain a dominant market position by appealing to all or most of the buyers in a product market. The variable needs and preferences of buyers in many product markets require the multiple targeting of market segments.

Unless specific marketing mix appeals are developed for each segment, buyers’ needs will not be met and the company’s sales are likely to suffer. For example, it would choose extensive targeting to include GM in automobiles, United Airlines in air travel, and Molson Brewery in beer.

target marketing plan

How to Use Target Marketing to Improve Your Strategy

Now let’s look at how you can execute strategies based on this information. Here are a few marketing targeting examples you and your brand can improve.

  • Marketing Communication: You can improve your marketing messages by using the language your audience uses. When you know and understand your target audience, you know the right ways to write content for a website, create copy for social media posts, and use words that connect and motivate your audience.
  • Content Marketing: Produce more valuable, targeted content by focusing on your audience’s unique interests and needs. Instead of creating generic blog posts, infographics, white papers, and ebooks that your audience won’t read, improve your content marketing activities by developing content that targets their specific desires, goals, fears, and wants.
  • SEO: Improve the likelihood your ideal audience will find your brand via search by optimizing your content for the best keywords your audience searches for. This includes voice search too. Targeting helps your marketing efforts by identifying the phrases and words your audience uses so you can target those terms and drive traffic back to your website.
  • Paid Ad Search: Paid ads can drive more traffic to your website by targeting the right keywords through paid ad search. Focus on the buyer keywords you have identified through your research to catch your target audience at the time they are ready to purchase.
  • Email: Use market targeting in your marketing to send emails to the right people, at the right time, with the right content for their stage of the buying cycle. Using what you know about your customer, outline their buying decision process, and identify the places where you can use email to guide them through their journey.
  • Display Ads: Use your knowledge of your audience to identify sites where you should place display ads. You can make sure your ads are only in places where your audience will see them by choosing to advertise on the sites you know they visit.
  • Guest Blogging:  Guest blog posting on other relevant websites you know your ideal audience visits. Use what you know about your audience to find strategic guest blogging opportunities that will put your brand in front of your target customers.

Wrapping Up Market Target Strategy

Selecting the product markets to be served by a company Is a critical business strategy decision.

Deciding how to compete in each product market of interest to the company is the focus of a marketing strategy. Key strategic marketing decisions include and how to position the firm’s products and services for each target market.

In analyzing the company and marketing strategies of successful companies, one feature stands out. Each has a market target and positioning strategy that is a major factor in gaining a strong market position for the company.

This is the case even though the strategies used by companies are often different. Examples of effective targeting and positioning strategies can be found in all kinds of sizes of businesses, including those marketing Industrial and consumer products.

When was the last time you reviewed your market target strategy?

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