Understanding the Market for the Good of your Business

Every successful business needs to understand who, where and why their customers are choosing to do business with them. Hopefully, I don’t have to explain this aspect of business much because if I do, I seriously think should dust off and update your cover letter and resume! In any case, to understand your customers and/or potential customers, the best thing to do is to break them down into groups that you can understand better. Here are some ways to break down the group:

Basic Demographic Information

Age - 0-5, 5-12, 13-17, 18-24, 25-29, 30-35, 36-50, 50+ something along these lines
Gender
Marital Status
Income Level - I usually follow the U.S. Tax Brackets
Education Level - HS, Graduate, Post Graduate

Geographic Information

Zip Code
City
State
Region
Country
Language

Occupation

Blue Collar
White Collar
Work at Home Parent
Associates, Seniors, Managers

Specific Product Market

Interest Based
Hobby Based

If you’re just starting off with your online business, the best piece of advice I can give to you is that you will want to look at yourself and see what groups you fall within using these categories. The reason I say this is because most likely you’re doing business in a particular field because you’re interested in that field. Most likely, someone that is the same age, located in the same region, has the same type of occupation level along with having the same interests as you is going to be interested in the products/services your business has to sell. Once you have good base of these customers, analyze them and find a common attribute among them and see if you can market to another group to expand your customer base!

Once you have done your home work, a great site to visit to understand how to break down your market is MarketingSherpa.com. The provide great articles and case studies from other online businesses.