How to determine your target market

Finding your target market is not always easy and can require some time.

Many cleaning contractors start their businesses by working with any company they can get. They know they must jump in somehow, so they start with what is available.

However, with time, they often develop specialties, and these specialties become what we could call their niche or target markets.

Having a target market has many positives. First, because it is their specialty, the contractor has likely encountered and addressed almost every type of situation that may come up within this niche.

The contractor understands the needs of these facilities. Further, they have a keen understanding about the people working in them and what they expect.

One California-based contractor is a perfect example. For many years, he worked as a housekeeper in a hospital.

When he started his contract cleaning company, he realised very quickly that cleaning doctors’ offices, healthcare facilities, and laboratories was his specialty.

This focus helped his customers as well. They did not need to explain things to him, as they likely would to a contractor new to the cleaning needs of a healthcare facility. He already knew what needed to be done.

Because it offers an array of benefits for both the customer and the contractor, it’s always a good idea to have a target market as you grow your business.

However, finding your target market is not always easy and can require some time. Here are some suggestions that may make the process move along a little faster:

  • Decide what types of facilities you do not want to clean. While the cleaning contractor in our example preferred customers in the healthcare industry, he would not take certain types of medical facilities, for instance, dialysis centers.  The cleaning demands and the cleaning needs of these centers can be very critical.
  • Determine if there is a need for your service. One way to determine the level of need for your service is to find out how many cleaning contractors are already serving the area. Will talk a bit more about this later – you may be in for a surprise.
  • Examine your current customer base. We mentioned earlier target markets tend to evolve. If you find that most of your clients are in the same industry, for instance, technology, it might be a good idea to focus just on these types of companies and facilities.
  • Base your target market on logistics. Contractors living in sprawling cities or suburban areas base their target markets not so much on the types of businesses or facilities but where the clients are located. They develop a market “territory.” They know the areas where they want to provide their services and where they do not. This has several benefits, among them, they become alert to what companies are moving in, what facilities are being built, and so on. Further, they are free to be a “name-dropper.” If the contractor is already cleaning facilities across the street, mentioning this to potential customers can be an advantage.
  • Consider expected profits. Profits can also be a determining factor. Most facilities today view quality cleaning as a high priority, but some are more willing to pay for it than others. In time, contractors typically learn which types of business and which types of facilities fall into each category.

Anticipate change

Some areas are well-served, and others are underserved.  I mentioned earlier that one way to determine a target market is to “stay within reach,” serving the needs of nearby businesses and facilities. However, keep demographic changes and trends in mind.

For instance, Toronto has grown from two million people in 1990, to close to seven million today. This means people – and businesses – are likely moving farther and farther away from the central city. Follow these trends in your area. Doing so can be a golden opportunity for contractors that want to take advantage of this growth.

Check out how significant the competition is. Don’t take a target market off your list because lots of cleaning contractors are already serving that area.

Here’s the surprise; very often, this means there are many opportunities in that same area. Explore the area and begin marketing in the area.  This will help you determine if it has possibilities or not for your business.

Another thing we should keep in mind is to not get “stuck” in one niche market or another. Many successful contractors have several target markets, different types of facilities they maintain, located in different areas.

Cities and industries are dynamic, they are always changing. Keep your eyes open to what is happening in your community.

Be willing to switch targets when the targets change.

Ron Segura is president of Segura Associates. He can be reached at seguraassociates@msn.com

This article first appeared in the September/October issue of INCLEAN magazine. 

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