4 Steps to Identifying Your Target Market

Identify Your Target Market

At the beginning of the budget season, the sales manager often asks members of the sales team to choose target accounts they will sell in the upcoming year. This is often a haphazard process. Not everyone is a prospect for your product or service. Believe it or not, some prospects will not or cannot buy from you.

These steps will help you zero in on viable prospects.

  1. Profile your current customers. It seems almost too obvious, but the characteristics of those currently buying your product or service can be duplicated for a prospect list. Profile your customer base. Uncover the commonalities: location, number of employees, annual sales, type of product they make or sell, their customer base, their SIC or NAICS code. Your CRM software can be a gold mine of information. Run a CRM report; it may tell you that the majority of your sales in past six to nine months have been to companies in the same vertical market with annual sales of $25 million to $50 million that are within a 200-mile radius of your office. Given that tidbit of information, we hope you will not spend your time trying to get an appointment with a $1 billion global corporation in a totally different vertical market. There’s power locked in your CRM. Take advantage of it.
  2. Talk to your current customers. This is a good reason for you to make a sales call. Ask why they decided to buy from you and how they are using your products or services. You will probably discover some common threads. You may also uncover areas of quality or service in which you’ve slipped. BONUS: Your customers will like the fact that you value their opinions. This will enhance your relationship. In the end, you will gain a better understanding of the types of companies predisposed to buying your products and services.
  3. Research your competition. Who are your competitors selling to, and who may be vulnerable? Ask around. Talk to your suppliers who may also supply your competitors’ customers. Other salespeople are another great source of information. What is the “word on the street”? Would competitors’ customers be willing to talk to you? Do some third-party research. The timing may be right for you to call on a prospect you’ve avoided because you thought you had no chance of changing their mind.
  4. Think beyond. Look beyond your target market once in a while. You may be surprised to find a great prospect just off the path you have been beating for many years. It’s about keeping your eyes and ears open. Don’t spend a lot of time in the weeds, but every now and again ask a good customer whether they know of some new application for your products.

Remember that it takes time and effort to accurately identify your target markets. It can’t be done the weekend before the budget is due. You should be continually refining and defining your targets.