Need to Know: Demographics
This is the first in a series aimed at Texas small businesses titled Need to Know. This series will explore important topics every small business owner should be an expert. Our first topic is crucial to the success of every small business: demographics. Demographics are often only given a passing thought to the busy business owner, but ignore at your peril. Demographics are key to identifying your customers, reaching them, and understanding feedback. Demographics are the average or typical characteristics of your target market. These can include age, household size, race, education, income, occupation, and location. You use demographics to choose your target market.
While household’s in Texas are not homogenous and will only continue to diversify in the future, success lies in the details. Texas has dominated lists of fastest growing cities since 2005. Understanding the changing demographics of your location can help give your small business the edge to capture the influx of consumers.
The first place to begin is to determine your geographic region. Will your business target a locality? Like The Woodlands or Plano or Carrollton. Or a region? Like piney woods region or hill country region. Or a metro? Houston metro area, Dallas/FTW metro area. Once you have defined your geographic area, you can then research and know the makeup of the population of that area. At the very least you will need to know: age, gender, income level, occupation, education, and family circumstances: married with children, singles, or retired. Usually cities or county chamber of commerce is a great place to start.
Next you will need to consider where and how your target demographic lives. Will you need bi-lingual workers in your area? Do you cater to commuters or pedestrians? Think of how people (your target demographic) will use your product or service, do you accommodate their lifestyle and needs? The answers help you understand how to sell, how to price, and how to reach your target.
Once you have researched your basic target demographic, you can now use the data to further develop your product or service towards them. Having a clear image of your customers allows you to anticipate their needs. You can begin to piece together how your product/service will improve their life, how they will use it, and what they expect from it.
Researching your demographics and target market can be done by yourself without spending a dime. Self research from your desk can be just as effective as paying a marketing/research firm. Your own sales data or that of competitors is a great place to start with valuable information that can help you understand sales, geographic, and demographic trends. Commissioning your own surveys or focus groups using customers is also a cost effective way to gather data as well.
Now you are ready to compile your date into an market analysis. A market analysis should include a detailed report on your target demographic, your industry description and outlook, and a competitive analysis about who your competitors are and how they market their products/services. The market analysis is your springboard to writing your marketing plan. Using all the components of your market analysis, the marketing plan puts your research into action.
Small businesses often cannot afford large market research from marketing firms. Reidel Law Firm aims to put the tools for effective and affordable market research in your hands. We offer flat fee strategic planning, marketing, and public relations for Texas small businesses. Contact us today for a free initial consultation.