Determine Market Sweet Spot

The most important result of target market segmentation is the identification of the “sweet spot” of your market. Your market sweet spot is composed of those groups of potential customers most likely to purchase your product. These are the people who feel as though your offering was designed especially for their needs. Sweet spot customers will usually cost you less to acquire and less to retain than any other potential customer. For this reason, we start our market segmentation by using knowledge of your product and the problems it solves to determine your sweet spot.

Identify Sweet Spot Characteristics

Once we have identified the general attributes of the sweet spot of your market, we then define the common sets of characteristics that form the market segments in your sweet spot. Depending upon your product, characteristics include personal demographics (gender, age, income, education…), personal business characteristics (role, title, responsibilities...), company characteristics (industry, target market, revenues…), etc. Market segments are considered well-defined when individuals within each group would be comfortable recommending your product to each other. We develop a set of high level profiles for each sweet spot segment which you can use to focus your marketing efforts.

Calculate Market Opportunity

When quantifying market opportunity, we focus on sizing the market opportunity your company and product can address. We leverage top down market sizing provided by specialized analysts and adjust those numbers based on factors that influence your company’s ability to reach the market. We also incorporate a bottom up approach that starts with a profile of a single customer and extrapolates that profile into a potential market by applying assumptions along with know demographics. This two pronged approach delivers better insight and stronger validation of your total addressable market.