What Is Potential Target Market?

People's brand choices often reflect their demographic characteristics, such as age and sex.
People's brand choices often reflect their demographic characteristics, such as age and sex. (Image: Alistair Berg/Digital Vision/Getty Images)

The pool of consumers in every major product category includes groups of people with a variety of wants, needs and personal characteristics. A firm's marketing challenge is to identify one or more of these groups as a potential target market – buyers most likely to choose their brand instead of that of a competitor.


While it is possible to market a brand to every potential buyer, this is a very expensive approach. It can also be wasteful, since many consumers will be loyal to competing brands or unresponsive for other reasons. Identifying a potential target market is important to improve the cost efficiency of a marketing program. By focusing attention on a more manageable and distinct segment, it helps the firm develop expertise in serving that segment. By getting to know a specific buyer group better than the competition, the firm can learn to deliver product benefits and promotional messages most likely to appeal to that target market.

Demographic Targeting

It is common to target consumer groups based on their demographic characteristics. These include identifiers such as age, sex, income, race, occupation, marital status and years of education. All demographic characteristics are both quantifiable and objective. In other words, you can express them in numbers, and they are not subject to interpretation. For example, the market for jeans is largely segmented based on age. Companies target teenagers for various styles, rather than their parents. Similarly, in the market for disposable razors, different brands appeal to women and men.

Psychographic Targeting

Attitudes, opinions, interests or lifestyles can heavily influence consumer buying decisions. These are psychographic characteristics. Unlike demographics, psychographics are subjective in nature. For example, two people who perceive themselves as risk-takers may differ significantly in how many risks they actually take. Likewise, there are no definitive measures of healthful eating or active lifestyles. Nonetheless, these characteristics often identify target markets for products as diverse as leisure travel, furniture and food.

Behavioral Targeting

Just as people have distinctive personal characteristics, they may also differ in consumption behaviors, such as how they use products or what benefits they seek. Companies can select target markets based on these behavioral patterns. For example, a brand of shampoo may appeal to people who wash their hair every day, but not to once-a-week shampooers. In the toothpaste market, there are different groups of buyers seeking specific benefits like taste, fresh breath, or cavity protection.

Geographic Targeting

Where people live can also be the basis for defining a target market. Most commonly, this reflects differences in climate or terrain. Winter coats will sell better in Maine than in Florida, while surfboards have more potential buyers in California than Colorado. However, you can also base geographic targeting on less obvious features, like density. People who live in small urban apartments, for example, are better targets for storage boxes and convertible sofas than those in large suburban homes.

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  • "Marketing"; Charles Lamb, Joseph Hair, Carl McDaniel; 2011
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