Who is your customer?

Marketing is not about chasing any customer at any given price. You have to decide which groups of customers (called segments) are most attractive to the business and are most likely to boost profits.

Identifying your market segment involves dividing the market into groups of similar consumers and choosing the most appropriate group for your business. Segmentation is done on the basis of size, profit potential and how well they can be defined and served by the business.

If you work in a niche industry, such as manufacture or mining, your target market will be alot more obvious and the process below can be simplified, but remember that some innovative thinking can always broaden or diversify your customer base. However, if you provide services to the average Joe and Jane Public, more research is required.

What is your market segment?

When defining your market segment, the two most important factors are the demographics and the psychographics of your customer.


Demographics will answer the following questions:

  • Age: What is the average age or age range of your customer? Do some of your products appeal to a certain age group, while others appeal to all ages?
  • Gender: Are your customers predominantly female or male or both? Perhaps your product is used by a male, but you know that females do the shopping?
  • Marital status: Is your customer married with a family or single? For example if you want to open a fast food outlet, you will need to know the proportion of families who live in your area. This will determine the predominant products on your menu.
  • Education and culture: These aspects frequently affect style, fashion, pricing and decision making processes. For example, you may want to search the Internet for information on Generation X and Generation Y to understand the different buying behaviours of youth.
  • Location: Where do they live and/or work? This will affect the ease with which your customers can reach you and the needs that arise from where they live.
  • Occupation: Are your customer’s professional people, artisans or others? How many of them fall into the different occupations you have listed.
  • Typical income bracket and household income: Ensure that when you state the level of earnings of your customer, that you match the positioning of your store in an area that suits your customer profile, especially if your business is a retail business.


Psychographics is a little more difficult to determine as much of it will be guess-work. The following are the types of questions you would ask about your customer in determining his or her psychographic make up:

  • Hobbies: What does your customer like to do for leisure time? Are they the outdoors or indoors type?
  • Health: What is customer’s opinion on health issues? Health conscious vs eat drink and be merry?
  • Holidays: What type of holidays do you customers usually take? Are they local or international trips?
  • Status: Is your customer fashion conscious? Do they drive expensive cars? Are they ambitious? Are they humble people?

There are hundreds of questions you could ask. The trick is to ask the basics – keep it simple and don’t over-analyse. You should get a general idea of what type of person your customer is, but you certainly don’t need to become a shrink.

This exercise can be challenging and rewarding, but you shouldn’t make these assumptions on your own. Speak to family and friends. Ask business colleagues for their opinions. If you are already in business and you need to do this exercise, it would be useful to pull in your sales team and have a healthy brainstorm session to define your market segments.

Professional research assistance

If you do need to have an in depth evaluation of who your customer is, you may want to hire a professional marketing or research company to do the analysis for you. It will cost you some money, but it's an important part of your planning and could be worth having it done by a professional.

Most small businesses, however, don’t need such an intense evaluation and many of the franchisors, for example, have already done the research. This is why franchising for first time entrepreneurs might be a better option to flying solo.

Defining your customer-base can go a long way in narrowing down your focus to target a specific high-potential group of consumers. This can be more effective than spending your marketing budget on random people who may or may not buy your product or service.

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