How well do you know your audience?
If you’re running a business, understanding your target market demographics is one of the best ways to find success. Without your customers, your business wouldn’t get off the ground, so you need to know what makes them tick.
Demographics include information about your customer base, including their ages, location, spending habits, occupations, marital status, and hobbies or interests.
But why are demographics so important? And how can you identify who your customers are? To learn more about how your business can grow and thrive with the help of demographics, keep reading.
How to Identify Your Target Market Demographics
First, you need to know who your target demographic is. It may take some time to figure out, but it’s an essential step of your marketing plan, so don’t skip over it.
To identify your audience, you need to do research into who is buying your product. For face-to-face sales, this may be easy to figure out, but for online sales, it takes some more work to figure out who is buying.
If you have an established mailing list, you may want to poll them to learn more about their interests and backgrounds—consider offering a discount coupon as an incentive to participate.
Or, you may want to host market research sessions to learn more about your customers.
Businesses should also create a buyer persona—that is, a profile of what your ideal customer would look like. Does this persona match with the reality of who is buying your product?
Try to tap into all the data you have from previous and current customers to know exactly who is buying your product, and why they’re selecting you over a competitor. This is extremely valuable data that you can use to improve your business over time.
Why Knowing Your Target Market Is Important
Demographic information is key to the success of your business. It can save you money, increase profits, and can make or break a company. Otherwise, your marketing strategy is basically just a stab in the dark.
Here are some of the best reasons why demographics matter.
Spend Your Marketing Budget Effectively
When you spend your hard-earned profits on marketing and advertising, you want to make sure your ads are reaching the right audience.
Why pay for ads and media buying if the people who see it aren’t the people who will buy your product? With demographics, you know exactly who you’re targeting and you can be sure your ad money is going to the right place.
Demographics should be considered in all types of media spending, but especially when it comes to digital advertising.
Reach the Best Audience for Your Brand
You can use demographics to work out which type of client spends the most when they shop at your business, along with which clients are most likely to become regulars and stay loyal to your brand.
These people will bring in the highest returns on your advertising revenue, so they are the ones you want to target.
Or, you may want to tailor various advertising campaigns to appeal to a certain audience. For example, if your research has shown that one demographic responds well to a humorous ad, while another prefers a more serious ad, why not run both ad campaigns specifically for those groups?
Carve Out a Niche for Your Company
You can also use your target market to carve out a valuable niche for your company. Through previous market research, you should have analyzed your competitors or businesses elsewhere who have the same product or business model.
Who is buying their product, and what type of customer do they tend to attract? Through this information, it’s possible to find gaps in the market where your product can slide in.
If most of your competetitors are targeted millennials, for example, can you target Gen Z? There could be a whole untapped audience out there, just waiting to discover your product!
Savvy marketers know their industry inside and out and are always looking for opportunities.
Improve Your Products with Tailored Feedback
Another important reason to pay attention to your demographics is so you can improve your services and products.
If you know who is buying your product, you can use them for market research, either formally or informally. Your company needs to know more about the thought process when it comes to purchasing your product.
Many companies host their own market research sessions or hire a third party to run them on their behalf. While this can be expensive, it can benefit any company.
When outsourcing to a third party, ensure they have a solid understanding of your brand and what you’re looking to get out of the session.
If you are about to launch a new product, for example, you may want to do a soft launch first, to a small group, to see if any changes need to be made before rolling it out publicly.
What made the buyer choose your company? What did they like or dislike about the sales experience? Do they think the pricing is fair? All of this information is data that you can use to improve and refine the experience a customer has with your business.
Improve Your Business with Demographics
As you can see, target market demographics are essential for any business, large or small.
If it’s not something you’ve used in the past, try out some of the suggestions above and start learning more about your customers. Or, change your marketing strategy to start attracting your ideal customer.
Marketers have known for years that demographics can help a business grow, earn more, and become more efficient, so get started today and see the advantages it can bring!