Dropshipping 101: Defining Your Target Market & Target Audience

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Smiling eCommerce dropshipper working remotely, defining your target market and target audience

Every business wants to be the next big thingwhether it’s the next Amazon of online shopping or the next McDonald’s of fast food. The immensity of these companies is apparent because of their wide reach. And by wide, we mean worldwide. 

Did they start off aiming to reach every single person in the world? Of course not. 

They all started as small companies that grew into the giants they are today by expanding into different markets, niches, and categories. Take Amazon, for example. When the company first started selling online, they sold books. They’ve since diversified into becoming a one-stop shop for online shoppers.

If you’re looking to start a dropshipping business, the initial goal is to go deep rather than go wide. When you aim for everyone, you probably won’t hit anyone. Not everyone will need your products, so save yourself the effort and reach out to those who do.

Defining your target market and target audiences is like finding people who are also looking for you. It’s as if you’re making way for a serendipitous business transaction!

Read on to discover how you can prepare yourself for success, starting with defining your target market and audiences.

Table of Contents

What is a Target Market?

A target market is a specific group of people to whom a business aims to sell its products or services.

Consumers who are in your target market share a similar need. They may also have similar or close to similar traits—namely income, purchasing power, geographic location, and demographic and psychographic characteristics.

What kind of person will most likely buy my products and services? Whose problems can my offer solve? These are the main questions you have to consider when defining your target market. 

Once defined, your target market may also influence your choice of products and services. For example, let’s say you plan to sell cosmetic products to millennial women. You may discover during your market research that a significant percentage of these women opt for environmentally friendly and eco-conscious products

With this finding, your goods would then have to meet specific standards, like:

  • Not tested on animals
  • Biodegradable packaging
  • Natural and sustainably sourced ingredients

Do you now see the alignment between the target market and the product? 

Defining your target can also help you map out your marketing plan. Several factors, like price point and promotional efforts, are contingent on your target market. 

Every business must make its target as well-defined as possible. Making it as such will pave the way for a unique brand and successful marketing campaigns that will ultimately inspire purchases. 

Target Market Example

Let’s have Nike as an example. It’s a well-loved brand all over the world, with the biggest market capitalization among its competitors. 

Since Nike is a huge player in the market, they had to segment their target market into multiple categories. But their key target market remains athletes. 

Over the years, the brand has nurtured their key target market by making their products durable, lightweight, and comfortable to usefeatures that are perfect for sports shoes. 

And to further boost their stature in the sports industry, they’ve partnered with top-notch athletes like Michael Jordan, Kobe Bryant, and Tiger Woods to promote their products. This sends out a message to athletes around the world that wearing Nike shoes contributes to an A player’s robust physical performance.

What is a Target Audience?

A target audience pertains to a narrower group of people than the target market. They are the intended recipients of your business’ message on marketing platforms, social networks, and other channels where you choose to advertise your products. 

Your target audience may have a few similar traits as your target market, but these factors are more specific and more subject to change over shorter periods. Also, each campaign you run may call for different target audiences. 

Want to get a better picture? Let’s go back to our cosmetic brand example.

The target market of this brand is women. But for a Mother’s Day campaign, you may target a more specific audience and focus more on children and spouses—people who are likely to buy gifts for their mothers and wives. 

As a dropshipper, you may tweak your target audience every time you run a campaign. And when you’re just starting out, frequent testing of campaigns is necessary to identify your winning ads. Conducting tests will allow you to compare the effectiveness of different creatives, target audiences, and ad placement, among others. 

Once you gain an in-depth understanding of your audiencetheir demographics, needs, desires, interests, and pain pointsyou will have a clearer direction for your marketing efforts. The key is to make campaigns that will resonate with your audience.

Target Audience Example

Let’s go back to the Nike example from the previous section.

Nike’s famous Just Do It campaign features Walt Stack, an 80-year old marathoner, telling the audience that he runs 17 miles every morning. By the end of the video, the line “Just do it” flashes right before Nike’s logo. 

The ad aims to evoke dedication and commitment from their target audience (i.e. athletes) who, in this case, are also their target market. This powerful marketing message sparks something in the audience: “If an old athlete can do it, why can’t I?”

What Differentiates Your Target Market from Your Target Audience?

To fully grasp the difference between a target market and target audience, it’s important to first understand that there are two ways to look at them.

The first one is to picture them as one big group (representing the broad target market) enclosing several smaller groups (representing the target audiences within that market).

Let’s go back to the cosmetic brand example to illustrate.

In this image, you can see that both the target market and audiences are end-users of cosmetic products. However, depending on your target audience for a specific campaign, your approach, copy, and creatives will have to change.

You may focus on the cruelty-free quality of a product if you’re targeting vegans. Meanwhile, you may focus on creating glam videos or nude makeup tutorials if your campaign is targeting women who are into nude cosmetics.

Now that you see how a market and audience could overlap but still differ, let’s talk about the second way to view these two. 

In some cases, a target audience is not an end-user. However, you could still direct your campaigns to them because of how they’re related to your target market and how specific circumstances could lead them to purchase. Take a look at the image below for a visual explanation: 

A diagram showing target audiences separated from the target market

While the women’s partners aren’t your target market, they could potentially be your customers if they’re looking for gifts for their partners. With that, they could make a great target audience, especially during special occasions like Valentines’ Day and Christmas.

As you can see, your target market may or may not be the same as your target audience. As end-users, your market will affect almost all of your business decisions, including your branding, product sourcing, pricing, and packaging. Meanwhile, your target audience will impact only the specific campaigns directed to them.

Why is it Important to Know Your Target Market and Target Audience?

Renowned consultant and father of modern management Peter F. Drucker said it best: “The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” 

When details about your potential customer and audience are well-defined, you could plan your products, services, and marketing strategies in such a way that they’d fit like a glove. 

In essence, you’re reaching out to people who are already looking for what you have to offer. 

And if you’re new to dropshipping, you’d be glad to know that even with a limited ad budget, you can run cost-effective campaigns if you appeal to a specific audience rather than to the general public.

How to Identify Your Target Market

1. Identify the unique value that you want to give through your business

Your value proposition is what will make your dropshipping business stand out. You have to make sure that your business isn’t just another run-of-the-mill store. Serve value, and you’ll surely attract sales.

Below are some guide questions to help you out. Try your best to make your answers as specific as possible.

  • What problems can you solve?
  • What needs can you fulfill?
  • What desires can you satisfy?

Answering these questions will help you identify and understand the motivations behind every purchase. Once you’ve figured out those motivations, you can begin to picture what kind of person your potential customer is.

2. Look at your competitors

Whether you’re just starting out (and don’t have an existing customer base yet) or have been grinding for quite some time, it’s imperative that you observe your competitors. 

Go through their websites, social media accounts, as well as their comments and reviews section. Then, answer these questions as you go:

  • What products do they offer? 
  • How do they present their brand? 
  • How do they promote their products? What kind of language and tone do they use?
  • Who is their target market? Do they have a specific target market, or do they cater to the general public?
  • How do they engage their audience? 
  • How frequently do they post content?
  • How often do they launch a new product?

Observing your competitors will give you a better understanding of your target market. Plus, you’ll also get an idea of what approaches had worked for this market before or what led them to engage with similar brands. Additionally, you can also identify your competitors’ gaps and then use these to create better offers.

3. Segment your target market

When sorting out your target market, you may find that you can divide your customers into groups. 

Market segmentation can help you narrow down your potential customers and group them according to different categories, such as:





Demographic

  • Age
  • Gender
  • Marital Status
  • Family size
  • Occupation
  • Education level
  • Income
  • Race
  • Nationality


Geographic

  • Continent
  • Country
  • Country/region
  • City
  • Climate
  • Localized areas (neighborhood)


Psychographic

  • Personalities
  • Lifestyle
  • Opinions, attitudes, and beliefs
  • Interests
  • Values

Based on this segmentation, you may create a buyer persona that should help you craft more targeted campaigns for your business. 

4. Start testing, then evaluate

Now that you know who you’ll be selling to, it’s time to start engaging with your target market. Remember: it’s only through testing that you can get real, data-backed insights about your products, services, and campaigns. 

Allot time every month to measure and evaluate your market’s response to your brand. 

You can do this by going through your sales reports and customer feedback and also by answering these questions: 

  • Is there a lot of competition in your target market/market segment?
  • Is your target market accessible?
  • Are there enough people in the target market to sustain your business?
  • Will they buy repeatedly? If not, why?
  • Are your products within their spending power?
  • What separates your business from the competition?
  • Why should people choose your products over others?

How to Find Your Target Audience

1. Use social listening

You can start your target audience analysis through social listening. 

It’s how you can monitor conversations about your niche, your products, and your business. By going through several posts, channels, and comments sections, you can discover valuable leads, plus the keywords and hashtags that people use when engaging with your competitors. 

What are they saying about your brand? How are they responding to your competitors’ products and services? What keywords and hashtags do they use to find products similar to yours? Social listening will give you insights into these questions.

2. Use web analytics tools

Analytics can inform many business decisions, especially in terms of targeting, retargeting, and optimizing. Two of the most commonly used analytics are Google Analytics and Facebook Insights.

Google Analytics

This tool can provide you with useful information for a thorough target audience analysis. With it, you can generate a demographic and interest report about the people who visit your website. Among others, the data you’ll have access to include your visitors’ age, gender, geographic location, preferences, tastes, habits, and even the device they use to access your site. 

Facebook Insights

If you have a Facebook page for your dropship store, then you can get valuable data by using Facebook Insights. You can easily check the characteristics of the Facebook users who viewed your page and then filter them by age, gender, city, country, and type of device used. You may also check the analytics for the different content types you post, such as the photos, videos, and text posts. 

3. Create a marketing persona

Using the information you gathered from the first two steps, you can now create a marketing persona. 

A marketing persona will define your target audience in greater detail. It pieces together the data you collected to flesh out a fictional character, which would then guide you through crucial business decisions. 

Some of the traits you should consider when creating a marketing persona are:

  • Demographic details: age, gender, marital status, race, education level, employment, income, location.
  • Profile: What is their role in society (in the workplace, in their social groups, and at home)?
  • What are their goals and challenges?
  • How can your product or service help them?

The traits of this persona will guide you in crafting a marketing message for maximum appeal. Ultimately, this will serve as your guide for all content marketing efforts and your compass for finding the best traffic channels to use. 

Key Takeaway: Targeting Leads to Lasting Success

If you want your business to thrive in the long term, you’ll need to have a clear definition of your target market and target audiences. Defining these is a way to make sure that all your efforts are optimized and that you are reaching people who are more likely to respond to your products. 

When you know whom you are serving and what their needs and problems are, you can choose better products and craft more compelling campaigns that inspire recognition, engagement, and purchase. 

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