Understanding Your Target Market - Cloud Object StorageBusiness+Idea... · We’re going to deﬁne your niche and get an estimate ... actively looking for advice on which hikes he

Day 4:

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Target Market

Determine who your target market is.

with Ryan Robinson

Research and learn how to attract them.

Understanding Your

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Finding a Profitable Business Idea: Understanding Your Target Market

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Who you create for, is equally as important, as what you create. - Click to tweet this.

In order to create useful products, services, and solutions for any group of people (yourself included), you need to first have a very good understanding of who they are, what motivates them, and develop a reasonable understanding of why they would switch to your product or service - over what’s already working for them.

Now that you’ve gone through the process of developing targeted business ideas that are within your areas of interest (and utilize your skills), we’re going to move into the process of validating an idea and learning about the customers who you’ll soon be asking for support from.

So, pull in the highest potential business idea that you’re most interested in from Day 3.

Write it down below, we’ll be working with it throughout the rest of this course.

My business is going to be:

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Now, for the rest of today’s activity, we’re going to work backwards into the process of discovering who your target market is.

We’ll be starting with your assumptions, digging into my consumer research methods, and operating from the very simple point of view that your business needs to solve a real problem - satisfy a true need - for a very specific group of people, in order to gain the early traction that you’ll need.

You’ll have a tremendously difficult time trying to launch a business with a product or service that’s designed for “everyone,” but essential to no one. We’re going to define your niche and get an estimate of the size of your target market.

By the end of today’s activity, you’ll have a very well-defined description of who your best customers will be, an estimate of the potential size of your niche, and a foundational understanding of how to start reaching that audience. On Day 5, we’ll be identifying your competitors, researching how they succeed, and start developing a plan on how to differentiate yourself.

Let’s get to it!






















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Understanding Your Target Market

1. What problem are you solving?

In order to develop an understanding of who you’re going to be helping through your business, you need to first know what you’re going to be solving for.

If I’m creating a website that I want to be the ultimate destination for outdoor enthusiasts to come and learn about the next great hike they should consider in California, the problem I’m solving (need I’m satisfying) is helping people find the best hikes in California.

Now, it’s your turn. Which problem are you solving? What need are you satisfying? Write it below.

The problem I’m solving, or need I’m satisfying is:

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Now it’s time to ask yourself who has the problem you’re solving. To make it even more clear (and easier), who’s actively looking for the types of solutions you’re going to create?

From my example above, if I’m creating a website with all of the best hiking recommendations in the state of California, I can make some pretty safe, broad assumptions about the type of person who’s actively looking for advice on which hikes he or she should consider.

Demographics aside (we’ll get into that soon), one thing that everyone looking for hiking recommendations will have in common, is a certain level of interest in the outdoors. They like doing physical activities that involve being outside. Very few people who hate hiking are going to be looking up hiking recommendations, and I wouldn’t want to cater my content to that person anyway.

Another fairly safe assumption is that my target market is going to be relatively physically fit. Enough so, to be considering multi-mile hikes on potentially rough terrain. That alone tells me a lot about other possible interests my target market will have. Many of them are likely fitness enthusiasts that enjoy traveling and exploring. They probably wear clothing from Nike, North Face, Patagonia, and other outdoor clothing brands.

Starting from place of understanding broad areas of interest that my target market shares in common, I can then move into narrowing the scope even further.

On the next page, we’re going to start listing out your target market assumptions.






















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2. Making Broad Assumptions.

If you consider yourself within your own target market, or have a close connection to the problem and solution you’re creating a business around, then let’s make some assumptions about your target market. Use my example from the previous page.

Start with writing down the answers to the following questions.

• Who has the problem I’m solving or need I’m satisfying?

• Is my solution for businesses or consumers (B2B or B2C)?

• What are 5 safe assumptions I can make about the interests, preferences, and desires of the people I’m creating my solution for?

Now, we’re going to start digging deeper into the specific demographics and psychographics of the people you’re starting to identify.

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3. Narrowing Your Personas.

A target persona is a fictional character you create, to keep in mind as you operate your business. They’re a very specific representation of the type(s) of customer your business exists to serve, and will help you stay on track with developing solutions for real people with real problems.

At this phase in developing your business, much of this activity will be built upon assumptions and verified through research, as you begin to interact with the people who get the most out of your business.

I’m going to start by creating a persona example for my hiking guide website business. On the next page, there’s a template for you to follow along and create your first persona, too.

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Background

Job: Retail Associate at REI, Freelance Photographer Family: In a relationship, no children

Demographics

Gender: Male Age: 26 Annual Income: $45,000 Location: Costa Mesa, California

Goals (as related to my solutions)

Primary Goal: Get outdoors and explore the best hikes California has to offer.

Secondary Goal: Capture beautiful photos to use on Instagram, and in freelance portfolio.

Challenges (as related to my solutions)

Primary Challenge: Relies mostly on word-of-mouth hiking recommendations, unpredictable results.

Secondary Challenge: Identifying good shoot locations & predicting the best times to be there.

Elevator Pitch

[My website name] brings you expert-sourced, detailed guides to the best hikes for outdoor enthusiasts and photographers in California, including tips and locations for getting the most popular photos from each hike.

Persona Name: Thomas R.






















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4. Persona Activity.

In reality, your business is likely going to be able to serve many different types of people well. But, by starting with a very limited, well-targeted type of person, you’re going to increase your chances of becoming an invaluable resource for a select group of people, early on.

Once you have paying customers for your business, you can start creating multiple personas to represent the different types of buyers (or users) that gravitate to you most. For now, we’re going to create for a very specific person, with the goal of building a small, loyal audience first and foremost.

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Background

Job: Family:

Demographics

Gender: Age: Annual Income: Location:

Goals (as related to my solutions)

Primary Goal:

Secondary Goal:

Challenges (as related to my solutions)

Primary Challenge:

Secondary Challenge:

Elevator Pitch

Persona Name:






















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5. Determining the Size of Your Niche.

Now that you have a more clear idea of who exactly your target customers are going to be, it’s incredibly important that you estimate the size of your niche, before getting too far into your business.

In most cases, you don’t want to build a business that’s only going to be able to provide value to hundreds of people, you want to target a sizable niche with tens or hundreds of thousands of potential customers. But, you don’t want to broaden your scope too much, for risk of diluting your value.

Depending upon the type of business you’re starting, the size of niche you should go after can vary greatly. As a starting point, here are my personal guidelines for the size of niche I look to target, based on my core belief that you should aim for first becoming invaluable to a core group of early customers.

Target Niche Size Guidelines

Brick & Mortar Storefront (no online component): 5,000 - 10,000 people

Physical Product: 25,000 - 100,000 people

Digital Product/Online Business: 50,000 - 500,000 people

Service Business: 1,000 - 10,000

Note that these guidelines are from my own experience. Are they going to be perfect for everyone and their unique situations? Absolutely not. Use this as a starting point to get a broader sense of how many people you should be appealing to during the beginning.

In determining the size of your niche, the closer you are to being within your own target market and understanding the wants, needs & desires of others within the niche, the easier this will be.

Over the next few pages, we’re going to jump into my three quick methods (and tools) for determining the size of your niche. Go ahead and pull these tools up in a new browser and read on.

1. Google

2. Google Trends

3. Google Keyword Planner (you’ll need to set up a free AdWords account to access this one)

Let’s get to it.

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http://www.google.com

http://www.google.com/trends

http://adwords.google.com/KeywordPlanner

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6a. Determining the Size of Your Niche: Google (Example)

Using my example of a website chronicling all of the best hikes in California, let’s start with Googling some top Keyword Phrases (KWPs) associated with my business idea, that potential visitors would be likely to search for.

Follow along with the template on the next page, filling in your results.

To get the most out of this, you need to identify the top 2-3 very basic, simplified KWPs that your ideal visitors, customers, or clients are likely to be searching for in Google. For my example, my two best guesses at top KWPs would be “hike California,” and “hikes in California.” There will naturally be a lot more long tail keyword phrases like, “best hikes in California for photographers” and “good hikes in LA,” but for the sake of this activity, let’s keep this search relatively broad for the moment.

Here’s what my search results turned up for, “hikes California.”

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These results are very insightful, and they give me several very important insights. It shows me the websites that are currently ranking (and competing) for this KWP, it shows me how many different search results (pages) there are, and I can learn A LOT from the top ranking results. They all appear to be exhaustive lists, with a very similar style of headline, and a high number of social shares.

Take mental note of these for now. We’ll be revisiting these potential competitors again in Day 5.

For now, run your own Google search and fill in the fields of the activity on the next page.

(Total results = # of competing pages)






















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Target Keyword Phrase (KWP):

Number of Search Results:

Top Search Results Type of Content

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6b. Determining the Size of Your Niche: Google (Activity)

Take the top two basic KWPs you’ve identified that prospective customers will be searching for, related to your business and search them on Google. Fill in the results below, highlighting the number of search results, which websites rank in the top 5 results, and what type of content is ranking best (lists, reviews, in-depth guides, infographics, video lectures, etc).


Number of Search Results:

Top Search Results Type of Content

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Next, we’ll be heading to Google Trends to dig in a little deeper.

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7a. Determining the Size of Your Niche: Google Trends (Example)

Continuing with my example business of an online guide to the best hikes in California, we’re going to turn to Google Trends to get some initial data and gauge the level of interest over time. Google Trends will give your search terms an estimation of popularity over time, on a scale of 0 - 100.

Follow along with the template on the next page, filling in your results.

Here are the results for my Trend search of “hike California.” It looks like search volume tends to spike each summer when the weather is nice, and February of 2016 gets a 66/100.

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The “Top Queries” and “Rising Queries” are extremely insightful here. These make great potential KWPs to target. Overall, not a bad Trend Score (66/100), but that doesn’t give me much solid insight into how many people are searching for hikes in California. That’s what I really care about, and what we’ll dive

into with Google Keyword Planner. But first, take the next page to fill in your Trend data.






















https://www.google.com/trends/

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Google Trend Score:

Top Queries Rising Queries

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7b. Determining the Size of Your Niche: Google Trends (Activity)

Take the top two basic KWPs you’ve identified that prospective customers will be searching for, related to your business and run them through Google Trends. Fill in the results below.


Google Trend Score:

Top Queries Rising Queries

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Next up, we’ll be shifting to Google Keyword Planner to get some more specific estimates on Monthly Search Volume (MSV).

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8a. Determining the Size of Your Niche: Google Keyword Planner (Setting up AdWords)

In recent months, Google has been making it increasingly difficult to access their Keyword Planner Tool, partly because of how useful it is as a free resource, without (very sneakily) getting you to set up paid ad campaigns in tandem with creating your AdWords account.

If you’re new to using Google’s Keyword Planner Tool, you’ll need to first set up a free AdWords account (AdWords is Google’s paid ad platform). If you’re not careful, however, you’ll be quickly led into a signup flow that’ll require you to input billing information, a credit card, and create a paid ad campaign in order to access any of Google’s AdWords tools (of which Keyword Planner is one of them).

So, read this entire page first - I’m going to show you how to avoid the need to input billing information.

Once you head over to http://adwords.google.com/keywordplanner, you’ll need to Create an Account (in the top right of the screen).

That’ll drop you into their signup flow, as seen below. Now here’s where you need to pause.

Before inputting any information, click “Skip the guided setup.” This will take you around the need to input billing information entirely. If instead, you fill out this first step and continue, you won’t be able to digress and restart the signup process without putting your billing information in.

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Once your into your new AdWords account, click on the “Tools” menu and you’ll see the option to hop over to Keyword Planner.























http://adwords.google.com/keywordplanner

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8b. Determining the Size of Your Niche: Google Keyword Planner (Example)

Google’s Keyword Planner tool is by far the most used tool in my day-to-day business. In my opinion, it’s the best (free) tool available for estimating market demand for a given KWP. And it’s managed by Google, where the overwhelming majority of the world goes to search for solutions & answers. That’s where you come in.

Going off of my California hikes website example again, I ran a search under the “Get search volume data and trends” option with the top basic KWPs below, to check what their Monthly Search Volume (MSV) is. These numbers represent Google’s estimate at how many unique searches (people) there are, every month for any given keyword phrase.

Follow along with the template on the next page, filling in your results. Here are the results for my Keyword Planner search.

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From this search, I can see that the total MSV (depending upon the time of year) is typically between 500-800 queries per month. Not a significant amount of search activity, but I know that the people who are searching for these terms are highly targeted. They know exactly what they want. One thing to note. The “competition” category predicts how competitive it is to get your ad placements at the top of Google’s paid ad section - not at the top of organic search results (which is more competitive).























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High Month: Low Month:

Volume: Volume:

8c. Determining the Size of Your Niche: Google Keyword Planner (Activity)

Now, I want you to take the top two basic KWPs you’ve been using for this activity, and input them into Google’s Keyword Planner tool and fill in the results below. Your goal is to get a quick understanding of how many people are searching for what could be your solution, each month.

While the competition field is most representative of the competition to get ad placements, it’s still very useful to us for a few reasons. If a term gets high competition and has a high suggested bid (over $8-10 or more per click), this tells us that there are businesses out there who are clearly generating a healthy return on spending that much money to bring new visitors to their sites, from these keywords. For that reason, we want to take note of competition, suggested bid price, and any seasonality swings in search volume that we can identify with your business.

Total MSV for your KWPs:

Your total MSV (and Yearly Search Volume) for the top keywords that you predict will be most associated with your business, represent one of the best insights into the size of your target market. It’s by no means all-encompassing, but for most types of businesses, how well you can rank in Google search results for keywords related to the solutions you provide, can make or break you. I’m also guessing it’s a good possibility that you found me on Google, as about 65% of my audience does ;)

On the next page, we’re going to put all of this together so you have a clear 1-sheeter with information about your target market that you can use, moving forward.


Monthly Search Volume (MSV):

Competition:

Suggested Bid:

High Month: Low Month:

Volume: Volume:


Monthly Search Volume (MSV):

Competition:

Suggested Bid:

Total Yearly Search Volume (MSV x 12):






















www.ryrob.com

My business is for

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Finding a Profitable Business Idea: Uncovering Your Interests

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The problem I’m solving is

and I want to create an invaluable solution for people.


9. Putting it All Together: Who My Target Market is & How Many of Them Exist

Alright, now this is the fun part. Let’s compile all of the research and insights you’ve found, into one simple, clear picture of who your target market is, and how many people fit that description.

To make this even more clear, fill out the statement below as succinctly as possible.

Brief Description of Ideal Customer (Persona):

Their Goal (As Related to Your Business):

Their Challenge (As Related to Your Business):

How They’ll Find You…

Target KWP #1: Number of Search Results:

Target KWP #2: Number of Search Results:

Total MSV: Yearly Search Volume: (Best estimate of your target market size)






















www.ryrob.com

How this factors into the rest of the course.What’s Next?

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Save this completed activity into your folder for this course.

Now that we’ve identified some trends with who your target customer is likely to be, and got an estimate for how many people match that description, it’s time to move into learning from your soon-to-be competitors.

Next up in Day 5, is Finding and Learning from Competitors. We’ll be revisiting the Google searches you ran earlier in this activity and diving into a couple more of my favorite free research tools.

Questions? Feedback?

Shoot me an email at [email protected].

I’m here to help.

Ryan























mailto:[email protected]?subject=Question%20from%20your%20skill%20assessment

Documents

Understanding Your Target Market - Cloud Object StorageBusiness+Idea... · We’re going to deﬁne your niche and get an estimate ... actively looking for advice on which hikes he