The Market: Target & Competition
Determining the right target audience is probably the most important part of your marketing efforts, because it doesn't matter what you're saying if you're not saying it to the right people! In this section of your business plan, go into as much detail as possible about who your market is. At a minimum, you should describe your typical customer. What is the age group, gender, family size, income, and geographic location. For business-to-business markets make sure you include the industry type (or SIC), company size, job titles/departments, annual revenue, and geographic areas. Include as much additional demographic and psychographic information as you can dig up, such as what their spending patterns are, whether they are brand conscious when it comes to your product type, what influences their buying behavior, what promotional efforts do they respond to most often, etc, etc.
Embarking on a journey into your target audience's brain, also known as psychographics is often key to your marketing efforts and will be demonstrated in more detail in our Marketing Plan Workshop.
Just as with all of the other sections of your business plan, there is no absolute for organizing your plan. Organize the market analysis section in the way that seems most logical and will best illustrate your product's market.
Give a complete and thorough overview of the competitive market. Who are the heavy hitters? What are their strengths and weaknesses? Identify the differences between your product offerings and theirs. What is their pricing structure? Sometimes your suppliers are good sources of information about your competition. Visit your competitors' locations, Web sites, exhibit booths, etc. Information is often the key to a strong competitive advantage.