How do you describe your market?

When I ask people to describe their market, they often say something like, “Most of our customers are in their mid-20s, just out of college.” Or they might use titles: “Our customers are CIOs at healthcare companies.” And while these are reasonable answers, they lack the necessary insight to help focus the company on gaining more customers.

My next question: “How much of your market do you think you can get?”

Not surprisingly, the answer is usually some fraction, such as, “About 30%” or, “It’s a huge market–we’d be very happy with 2%.”

And that’s the problem. They’ve just described a demographic that might purchase their product or service, but they really haven’t described what motivates those people to purchase, or how they can influence that purchase decision.

Here is a simple but powerful way to segment and think about your market:

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