Objective: You will learn how to identify your target community and audience in two respects: the community who will use your business and the community who will support your business on Backers.
Identifying a target community makes everything you do in your business ー from product design to branding to community-building and more ー more affordable, efficient, and effective.
Your business’s community. Knowing who you are designing and building your business for is very useful. It allows you to create engaging content, products, and services that cater to this community’s needs. It enhances your branding and marketing efforts because you have an understanding of who you are connecting with and allows you to direct your efforts to focus on those people. It makes your outreach and design iteration processes more effective because you know who you need feedback from to optimize your offerings.
Your Backers community. Knowing who you are trying to capture as supporters on Backers will be a key determinant of your equity crowdfunding success. Ideally, you will be able to build a strong community for your business. These people will engage regularly with your ideas, products, and services. You will then be able to upsell this community on your equity. We will talk about that more later on in your Backers journey!
There is also an audience out there who could be interested in supporting you on Backers, but who do not use your products or services. You should make sure to assess exactly who this community is (along with assessing your business’s community), and develop ways to engage these potential Backers early on.
How to identify your target audience/community. It is important to remember while choosing a target community that this does not exclude other people from your business. Rather, it lets you focus your limited resources on subsections of the population that are more likely to support you! Further, you can have (or at least try out) multiple target audiences that you develop as your business expands.
Here are a few steps to identifying your target community:
- identify the key benefit your business provides. We did this earlier in the Telling Your Story lesson. What problem does your business solve? What need does it meet? Here, we want to be sure to frame this in the context of the outcome for your target community. For example, we could identify the key benefit of a home workout equipment company as: Helping people get fit, live healthy lives, and feel empowered without having the inconvenience (and possibly self-conscious) experience of going to a gym.
- identify who wants this benefit. If you already have a customer base, you should look here first. Why do they buy from you? Look for common characteristics and interests. Which ones bring in the most business? It is very likely that other people like them could also benefit from your product/service. If you do not already have a customer base, it might be worth checking out the target communities of your competitors. Who are your competitors targeting? Who are their current customers? If they’re already established and a lot bigger than you, you really shouldn’t go after the same market. You should find a niche market that they are overlooking. For example, if you are making a rideshare app, don’t target the exact same market as Uber or Lyft. Try to find a niche market you can play into ー if your key benefit is that your rideshare app has no carbon emisssions, you can target environmentalist ridesharers; if your key benefit is that your rideshare app creates a comfortable space for women, you could target women who prefer women drivers. In most markets, there are many niche communities that you can focus on.
- refine this target community. There are many steps you can take now to further define and refine your community. Two key areas are determining the demographics (age, location, gender, marital or family status, occupation, income level, education level, etc.) and psychographics (attitudes, values, interests, lifestyle, and behavior, etc.) of your target community. The further readings go into these in more detail. Using this information, you can create a buyer person.
- evaluate your community. You now need to objectively assess whether your target community could actually work for your business. Ask yourself: Are there enough people who fit my criteria? Will my target really benefit from my product/service? Will they see a need for it? Will they buy repeatedly, or will we have to constantly close new customers? Do I understand what drives my target to make decisions? Can they afford my product/service? Is there much competition for this market segment? If there isn’t, why is that? If there is, what separates us from the competition – why should customers buy from us? Can I reach them with my message? Are they easily accessible?
Action Item(s):
- Go through steps 1-4 above to identify your target audience/community for your business.
- Do this at least two more times to identify two other possible target audiences/communities you might want to attract to your business.
- Go through steps 1-4 above to identify any potential extra Backers audience/community you might target. Remember, while you will upsell some of your business’s community on equity, there may also be an audience out there who could be interested in supporting you on Backers, but who do not use your products or services.
Further Reading:
https://www.oberlo.com/blog/target-audience
https://www.inc.com/guides/2010/06/defining-your-target-market.html
https://www.wordstream.com/blog/ws/2014/09/18/beginners-guide-to-target-markets
https://www.feverbee.com/strategy/who-is-your-target-audience/
