Target Market Strategy

Business plan consultants will tell you that having a clear target market strategy is an essential prerequisite to running your business, and so it is something you absolutely cannot neglect when you are writing your business plan. This section of the plan identifies precisely how you plan to market your product or service to the market you have identified as your most receptive audience. A careful, studied market analysis is required in order to develop a target strategy, which is the only way to ensure that you can gain control of the entire portion of your market that you deserve. So when preparing your business plan's market strategy, you need to have clearly defined your market (by size, growth, structure, trends, etc.) before trying to write this key section. You also need to have determined the segmentation factors that produce gaps in the market into which you can position your products; this is the central method touted by business plan consultants.

Your target market strategy needs to project your company's market share. This is a highly subjective matter based on a market analysis and on competitive distribution, pricing, and promotional strategies. Your business plan will need to consider two interrelated factors in order to determine the market share you can expect to command through your target market strategy. These are as follows: (1) industry growth and how expansion will increase the total number of purchasers or users, and (2) the conversion of users from the total feasible market. You need to perform this type of market research in order to make a target market strategy that is cogent and complete and meets the litmus test applied by bankers, investors, and business plan consultants.

Your target market strategy should identify how you intend to position your business in the marketplace. Your positioning strategy will be tied to several variables linked to the motivations and requirements of target customers and the actions of your primary competitors. You need to know how competing businesses are positioning their products, the exact attributes that make your product or service unique, and the customer needs your product aims to fulfill. Your business plan should illustrate your positioning and the logic that underpins it; if you are unsure of how to best express your business' positioning, it would be wise to discuss the matter with business plan consultants.