The purpose and methods of market research: target market.

The idea

A target market is the specific group of customers a business aims to sell to, defined by shared characteristics such as age, income, location, lifestyle or buying behaviour. Identifying it matters because it shapes every marketing decision: a business can design a product with the right features, set a price the group will pay, place it where those customers shop and promote it through media they actually use. For example, a company selling reusable water bottles to environmentally conscious students might choose a low price, sell through university shops and advertise on social media. A clear target market also helps a business avoid wasting money trying to appeal to everyone, and it gives a benchmark for judging whether sales are reaching the intended customers. Market research is used to identify and understand this group before decisions are made.

What earns the marks

• Defines target market as the particular group of customers a business aims its product or service at, rather than all possible buyers.
• Explains that the target market can be described by characteristics such as age, gender, income, location, lifestyle or buying habits.
• Shows how identifying the target market influences marketing decisions, for example product design, pricing, distribution or promotion.
• Uses a relevant example, such as a business targeting students with low-priced, sustainably made products sold through campus outlets.
• Explains a benefit of a clear target market, such as more effective use of a limited marketing budget or stronger customer appeal.
• Links target market to market research, explaining that research helps a business find out who its customers are and what they want.

Common mistakes and how to put them right

• Treating the target market as everyone who might buy the product.

  Put it right: Define a specific group with shared characteristics.

• Confusing target market with market size.

  Put it right: Target market describes who the customers are, while market size describes how many there are or how much they spend.

• Assuming the target market never changes.

  Put it right: It can shift as tastes, incomes or competition change, so research should be repeated.

Exam tips

• Define the term precisely first, then apply it to the business in the case study rather than leaving it abstract.
• When asked to explain, chain your points: identify the target group, state a marketing decision it affects, then say what difference that makes.
• Use the context of the case, naming the actual customer group and a specific marketing choice, to reach the higher bands.