Start Your Own Business by Inc The Staff of Entrepreneur Media

experiences during their formative years. This leads them to form a bond and behave differently from people in different cohorts, even when they are similar in age. For instance, people who were young adults in the Depression era behave differently from people who came of age during World War II, even though they are close in age.
     
    To get an even narrower reading, some entrepreneurs combine cohort or generational marketing with life stages, or what people are doing at a certain time in life (getting married, having children, retiring), and physiographics, or physical conditions related to age (nearsightedness, arthritis, menopause).
    Today’s consumers are more marketing-savvy than ever before and don’t like to be “lumped” with others—so be sure you understand your niche. While pinpointing your market so narrowly takes a little extra effort, entrepreneurs who aim at a smaller target are far more likely to make a direct hit.
    2. Focus . Clarify what you want to sell, remembering: a) You can’t be all things to all people and b) “smaller is bigger.” Your niche is not the same as the field in which you work. For example, a retail clothing business is not a niche but a field. A more specific niche may be “maternity clothes for executive women.”
    To begin this focusing process, Falkenstein suggests using these techniques to help you:
    • Make a list of things you do best and the skills implicit in each of them.
    • List your achievements.
    • Identify the most important lessons you have learned in life.
    • Look for patterns that reveal your style or approach to resolving problems.
    Your niche should arise naturally from your interests and experience. For example, if you spent ten years working in a consulting firm, but also spent ten years working for a small, family-owned business, you may decide to start a consulting business that specializes in small, family-owned companies.
     
    WARNING
     
    Marketing to ethnic consumers? Don’t make these mistakes: Sticking ethnic faces in the background of your marketing materials, “lumping” (for example, treating Japanese, Chinese and Korean Americans as one big mass of “Asians”), or relying on stereotypes such as slang or overtly ethnic approaches. Subtlety and sensitivity are keys to success when approaching these markets.
    3. Describe the customer’s worldview . A successful business uses what Falkenstein calls the Platinum Rule: “Do unto others as they would do unto themselves.” When you look at the world from your prospective customers’ perspective, you can identify their needs or wants. The best way to do this is to talk to prospective customers and identify their main concerns. (Chapter 7 will give you more ideas on ways to get inside customers’ heads.)
    4. Synthesize . At this stage, your niche should begin to take shape as your ideas and the client’s needs and wants coalesce to create something new. A good niche has five qualities:
    • It takes you where you want to go—in other words, it conforms to your long-term vision.
    • Somebody else wants it—namely, customers.
    • It’s carefully planned.
    • It’s one-of-a-kind, the “only game in town.”
    • It evolves, allowing you to develop different profit centers and still retain the core business, thus ensuring long-term success.
    5. Evaluate . Now it’s time to evaluate your proposed product or service against the five criteria in Step 4. Perhaps you’ll find that the niche you had in mind requires more business travel than you’re ready for. That means it doesn’t fulfill one of the above criteria—it won’t take you where you want to go. So scrap it, and move on to the next idea.
    Target Market Worksheet
     
    Use the following exercise to identify where and who your target market is. Once you’re done, you’ll have an audience to aim for and hone in on rather than using a shotgun approach, which is a time- and money-waster.
    1. Describe the idea:
     
    2. What will