Describe your market. Where is it? How big is it? What is the growth rate? What are the unique features or dynamics of this market? What causes people to buy? What are the demographics and psychographics of your target customers?
Marketers usually direct and focus their marketing and promotions on a particular set of consumers that are known as the target consumers . The target market may be defined as a large or a small group of customers depending on the ability of the target market to sustain the profitability of the business. The target market selection process involves five key steps: a) identification of targeting strategy, b) selection of segmentation variables, c) developing market segment profiles, d) evaluating the various market segments and e) selection of specific target market.
The market segmentation is defined as the art of dividing the market into homogenous groups of segments or people that have similar needs . The main purpose of market segmentation is to allow marketers to design a marketing mix that accurately matches the needs of the customers in the target segment. A market segment is defined as a group of customers that share common characteristics (demography, geography, psychographic or behavior) and have similar needs .
For a successful market segmentation, five conditions must be met that include: a) customer needs for products are heterogeneous, b) segments should be identifiable and differentiated, c) the total market should be divided into segments that can be differentiated from each other on cost, profit and sales, d) at least one of the segments should have the ability to support sustainable profits in the market and e) the organization should be able to reach the target segment through marketing mix .
The target market for restaurant Little Treasures can be segmented on the basis of various variables such as demography, geography, psychographic and behavior factors. Segmentation variables are the characteristics of individuals, groups or organizations that are used to divide the market into segments .
Geographic Segmentation of Little Treasures Restaurant
Geographic segmentation involves the segmentation of the target market on the basis of geographic variables such as climate, geographical location, city size and population density . The target market for the Little Treasures restaurant shall include the city of Chicago. The city of Chicago has more than 2 million residents, including over 600 thousand children that will serve as the primary customer base for the restaurant. Market density refers to the number of potential customers within a unit of land area such as the square mile . The population density of Chicago is 11953 people per square mile which is quite high . The high population density makes the market attractive for Little Treasure Restaurant as the city has 29 percent of the population that is below 20 years of age and these are the main target market for the restaurant.
Demographic Segmentation
The demographic segmentation involves the market segmentation on the basis of demographic factors such as age, gender, income and life cycle stage. The age demographic segments for Little Treasures Restaurant include young children and teenagers below 20 years of age and youngsters below 25 years of age.
The total number of city residents in Chicago for 2000 estimates were 2,896,016 that include: Population under 5 years old: 216,868
Population 5 to 9 years old: 224,012
Population 10 to 14 years old: 200,802
Population 15 to 19 years old: 200,962
Population 20 to 24 years old: 239,252
Population 25 to 34 years old: 533,199
Population 35 to 44 years old: 433,268
Population 45 to 54 years old: 330,507
Population 55 to 59 years old: 116,932
Population 60 to 64 years old: 99,757
Population 65 to 74 years old: 159,915
Population 75 to 84 years old: 103,720
Population 85 years and over: 35,168
Nearly 29 percent of the population is below 20years of age and represents the target market segment for the restaurant that is aimed at young kids.
The life-stage segmentation for Little Treasures restaurant may include parents, children, and their grandparents. The parents and grandparents may bring the children to the restaurant for fun and entertainment and therefore are an attractive target market for the restaurant. The parents and grandparents have higher income levels so as to satisfy the demands of the children for eatables and drinks.
Psychographic Segmentation
Psychographic segmentation is done on the basis of psychographic variables such as motives, attitudes, personality, lifestyle, values and interests . The psychographic segmentation for target market of Little Treasures Restaurant may include the customers that need a family outing and a place to spend memorable time with family. The target market includes customers that are family oriented and tend to value personal time spent by family on a daily basis and on special occasions. The target customers are interested in enjoying healthy food in the company of their loved ones. These customers want to be loved and respected by others and want to be treated with full dignity. The restaurant shall satisfy the inherent needs of these customers to be treated with the highest respect and dignity and also provide them with a personalized space to spend memorable time with their family.
The target market for Little Treasures Restaurant is measurable, approachable, profitable and differentiated on the basis of the various demographic and psychographic variables. On the basis of the above analysis, the target market for Little Treasures Restaurant may be defined as: Young children, parents and grandparents living in Chicago that have the tendency to spend time with their loved ones including family and friends in a restaurant while enjoying good quality food. These individuals value family more than anything else and therefore want to spend personal time with family quite often.
The factors that cause people to buy are their interests and their personality to spend time with family and friends. These people are fond of eating but need quality food that is healthy for them and their family. They need a personalized space to spend quality time with their family and also want to be treated with dignity and respect and aspire for good quality service. These people may be offended by the poor behavior of the restaurant employees or failure of the restaurant to meet their expectations. The restaurant needs to maintain superior services in order to attract target customers and retain the customers in the long run.
References
CityData. (2014). Chicago, Illinois. Retrieved from Citydata.com: http://www.city-data.com/city/Chicago-Illinois.html
Ferrell, O. C., & Hartline, M. (2012). Marketing Strategy. Mason: Cengage Learning.
Lamb, C., Hair, J., & McDaniel, C. (2011). Essentials of Marketing. OH: Cengage Learning.
Pride, W., & Ferrell, O. C. (2008). Marketing. OH: Cengage Learning.
