You may think that you already determined your target markets while generating the ICP – Ideal Customer Profile. Why are we now dealing with target market analysis? The answer is simple; industries defined in your ICP should not limit your sales and marketing strategies.
You must analyze and segment all potential markets down by demographics, geography, industry, company size, and other relevant criteria. This action will make you focus on the leads that closely match your market.
Significance of target market analysis
Businesses-to-business companies must have a thorough understanding of their industry in order to operate and compete effectively. B2B target market analysis provides insight into a sector’s customers, rivals, opportunities, and risks.
Numerous large and medium level industrial corporations are aware of the importance of market research and analysis as part of their general business strategy. These companies desire to comprehend the industry, and analyzing the markets enables them to identify potential risks and opportunities.
What is B2B target market analysis?
Market examination aides in the formulation of more broad strategic decisions, such as market entry or investment. This analysis evaluates a market’s size, growth rate, trends, competitors, and profitability, among other factors, in order to produce a quantitative assessment of the market.
- Conduct an analysis of your products (goods or services)
- Consider the competition
- Determine the segmentation criteria
- Conduct research
This is not a fully exhaustive list, as priorities vary by industry. All target market analysis studies, on the other hand, are intended to show a thorough awareness of these issues that can affect a business’s performance. Each component will be discussed in detail below.
1. Conduct an analysis of your products
Consider the industrial goods or services you’re selling in order to determine which customers would benefit from these. The following questions may help you during the brainstorming:
- What is the purpose of your products (goods or services)?
- Is it capable of resolving any operational issues or pain?
- Which companies are the most likely to benefit from your products?
Market data analysis will assist you in better understanding your products’ target market. Indeed, you may discover that your current customers are not the right demographic for your business. If you find a discrepancy during this process, you’ll want to improve your market’s alignment with your particular B2B marketing goals in order to realign.
2. Consider the competition
Conduct a competition study to see who your competitors are targeting. Analyze their customer base to determine whether there is a segment of the market that they are overlooking.
The most effective method for accomplishing this is to undertake a competitive analysis. You should conduct research to determine who your rivals are, what they provide, and even how they sell.
Examining your competition can also assist you in identifying market gaps which you can fill. Which types of target market are they ignoring? This may entail regional expansion or the development of new items aimed at a different market.
3. Determine the segmentation criteria
Numerous variables can be used to segment a market. Customers can be classified according to demographic, regional, and purchasing behavior characteristics. This is the process by which an ideal customer profile (ICP) is created. You can segment your potential customers into many criteria.
Let’s give an example of market analysis. For instance, suppose your target market is medium sized enterprises in the automation software business. You might segment your target customers into numerous categories, such as marketing department heads, sales department heads, founders, and CEOs.
4. Conduct research
As you start your target market analysis outline, it is important to conduct additional research. Which marketing methods should you employ in order to connect with your prospective market? Is the market for your product (good or service) sufficiently large? Market research will assist you in gaining a better understanding of your market.
Selecting the appropriate market can reveal a lot about your organization. Are you aiming to become a high pace organization, or do you perceive yourself as a pipeline with customers that flows steadily?
Market research vs analysis
I want to clarify something to avoid any misunderstanding: market research and analysis are separate concepts. Target market analysis is a comprehensive examination of analyzing the market, including your company and products, competitors, market conditions, and naturally, customers.
Analyzing is mostly under the responsibility of marketing departments. Conducting effective analysis is a different profession that needs a solid marketing background. So, it should be handled by marketing professionals.
On the other hand, we all know that an industrial sales executive’s essential weapon is reliable information.You must completely understand how your products will be met in the market they are addressing by accurate analysis.
Target industrial market identification
TIMI -target industrial market identification- may be considered as a sub-activity of market research. It guides you to the right spots to offer the right products to the right companies in the right markets. Studies show that companies that properly conduct TIMI sell more and are more profitable than companies that don’t.
Vendor companies that effectively use TIMI to adjust sales strategies get the generous benefits research provides. Research takes some time, but the outcome of this time investment is always positive.
Market analysis vs market identification
Market analysis and Target Industrial Market Identification are sibling concepts. You cannot separate them from each other. Innovative industrial vendors always use both of them together. Because they desire to ensure the potential customers in their markets will be interested in their goods and services. That’s the reason for searching for the target markets. In short, industrial sales executives should find the right target industrial market where they can match with leads that look like their customer portfolio.
Target market analysis is perhaps the most critical component of any B2B corporation. Indeed, regardless of whether it is a B2B or B2C, all companies should know that their business strategy is meaningless if they do not fully understand their customer market. Analyzing the market becomes even more critical in this situation.
The only way to establish a company’s reputation is to conduct extensive market research. The latter enables corporations to more easily penetrate into a B2B market and acquire new customers. We all know that it is a primary objective of any profit-seeking sales company.