How to Identify Your Target Market for Crowdfund Investing Opportunities
When establishing a crowdfund investing business, you must get specific about your target market. Defining who your customers will be is critical. Have you ever heard the phrase “It’s impossible to boil the ocean”? It’s a great metaphor for why finding and focusing on your target market is important.
When you start a business, the funds available to use for marketing your company to drive sales are limited (always, no matter how much you raise through crowdfund investing or any other means). You never have an infinite pool of dollars. Therefore, you cannot market your business to every person everywhere.
Say that you have $75,000 for marketing your new organic farm to your community. How will you spend it? You could spend your entire budget on shotgun-style direct mail advertising to everyone in the state or city you’re located in . . . and likely you won’t find your market and your business will fail.
Determine whose pain you can ease. Human beings buy things either to stop pain they’re experiencing now or to reduce the chances of pain they’ll experience in the future. Think about that for a moment to see if it rings true in your own life. You can wrap lots of other reasons around a decision to buy a product or service, but if you really dig, it comes down to stopping current or future pain.
Why do you buy food? To stop current or future hunger pangs (or boredom or stress). Purchasing a car, purchasing a plane ticket versus a train ticket, purchasing clothing, going to see a movie, visiting the doctor, buying organic versus conventional foods . . . it all comes back to stopping pain.
Your target market is the potential customer who has the greatest need for your product — the person whose pain you have the best chance of easing. That person (often called a marketing persona) is most likely to spend money immediately to get what you’re offering.
Let your core customers spread the word. Humans are herd creatures. Your passionate core customers will market for you and build your business. Have you ever used an online review site, like Yelp? These sites are one tool that core customers (or detractors) use to spread the word. You can turn your target market customers into your greatest marketing assets by delivering exactly what they need and expect.
When you know who your target market is, you can analyze how large that market is. Are there enough restaurants and moms focused on organic food in your selected geography to build a profitable business? How many customers buying how much per week (or month or year) do you need? These numbers are crucial in determining your financial needs, including how much you need in crowdfund investments.