Learning how to define your target market is one of the most important things you’ll ever do in your internet business.
This one decision may very well determine whether or not you’ll have a profitable business a few weeks or months from now.
To define your target market, you need to first answer these questions:-
- How do you find your target market?
- Where do you look for ideas?
- Once you have a target market in mind, how do you research it?
Here’s how…
What to Look For in a Market
There are several factors that make for a good target market.
The first factor is that the market is small enough that you can be a major player, but not so small that you can’t make good money. For example, you wouldn’t want to start a new online dating site because Match.com and eHarmony clearly have the market in a stronghold.
However, you probably don’t want to start a site on underwater basket weaving either, as it’s too small to make any money.
The second factor is that there is money being spent. Sure, “dog pictures” may not have any major competition – but chances are, that’s because there’s no money being made!
The best markets are groups of people who have a problem that needs to be solved. People who have problems are more willing to spend money.
Where to Look for Ideas
There are several great places to look to help you define your target market.
The first is Google Trends. Google Trends will give you a good idea of what things are hot right now. This can often help you identify new target markets and become a major player before others hop on the bandwagon.
Another great place to look is Amazon Magazines. If there’s enough of a market for a magazine, chances are there’s enough of a market for you to make money online.
eBay Pulse is another great place to look. Again, you’re looking for potential markets where you can become a major player
How to Research a Target Market
Once you have an idea, then what? How do you do your research to see if it’s viable?
First, check the volume of traffic to make sure there’s enough for you to make a living. You can do this by checking the Google Keyword Tool.
Once you’ve made sure you can actually make enough money for it to be worth your while, the next step is to get to know the market and the market’s spending habits.
There are two main places you should look: Your competitors and the niche forums. Here you can check:
- How are your competitors doing?
- Are they selling high ticket items, or are they scraping by with advertising?
- Are AdWords bids high or low?
These factors will help you determine how much money is being spent.
Go back to the niche forums to find out what are the typical problems people have in this market. If someone asks a question and others say “I have that same issue!” then you should definitely take note.
Once you’ve brainstormed a few niche markets, identified the ones with promise and then narrowed them down to the winners through a good research process, then the next step is to take action and make it happen.