Picking Your Target Market: Lessons from Trader Joe’s

marketing small business marketing Jan 18, 2022
Trader Joe's Target Market

Imagine for a moment that you own a grocery store.

You might resist focusing on a specific target market to gain more customers, because who doesn’t shop at the grocery store? And yet, grocery stores still have a brand, so they have to focus their marketing on a certain type of customer.

Just ask the management of the quirky grocery chain Trader Joe’s. The kind of customer they’re targeting is “an unemployed college professor who drives a very, very used Volvo.” 1

Do all (or even most) of the shoppers at Trader Joe’s match that description? Certainly not. In fact, a demographic analysis of Trader Joe’s customers shows that the highest percentage of shoppers are Asian, between the ages of 25-44, and making over $125K per year.2

Whether any of them (or the other types of Trader Joe’s shoppers) are in academia, jobless, or driving Volvos is really not the point. The point is that Trader Joe’s has created an experience that these shoppers are drawn to, and it’s because they have a clear idea of who they help — and what those customers care about.

We all dream that our products will have mass appeal, which is why it’s difficult to narrow down exactly who your market is. Like every business owner, you may fear that if the market you pick isn’t big enough — or if many of the people who might buy your product are excluded from your message — that your product will fail because of your lack of foresight, not from its lack of potential to meet a need.

The Dangers of Marketing to “Everyone”

You might do what many businesses do: You keep your market wide — and your messaging even wider — so that no one feels excluded. Essentially, you market to “everyone who might want to buy.”

To you, it makes sense that lots of different kinds of people, regardless of age group, location, interests, ethnicity, income, or gender, would be stumbling over themselves to buy your product.

But if you don’t focus on any target market in particular, the people who might incidentally be interested in what you’re selling will think these thoughts in rapid succession:

  • You don’t know what I want or need.
  • Is this product right for me?
  • Why should I buy from you?
  • This is too much of a risk.

And just like that, the opportunity for a sale disappears as quickly as it arrived.

In order to market to people effectively, you have to narrow down exactly who would benefit the most from what you have to offer. If your product is new, you might be thinking, “What if I don’t know who would benefit the most from this product? How am I supposed to choose a target market?” The truth is, not only will you need to choose a target market, but you will need to focus on a target audience and create an avatar. 

Right now, all you want to do is get a rough list of people who might be interested in your product.

If you already have customers, you will want to list the kinds of people who have purchased (and for what reason). If you haven’t sold anything yet, it’s time to brainstorm.

For example, if you’re selling an online course that teaches principles of time management, here’s what your list might look like:

  • College students who struggle to attend classes and get their work done on time
  • Professionals who just got promoted or have a bunch of new responsibilities
  • Busy moms who are juggling kids’ needs and other priorities
  • People who say “yes” too often and can’t focus on what they really want
  • Entrepreneurs who have a hard time turning down any opportunities
  • Leaders of nonprofits who have to manage volunteers, staff, and fundraising efforts
  • People who have struggled with time management throughout their lives
  • Freelancers who have to get clients, manage money, and complete their work on time
  • Small business owners who are hiring and training staff as well as acquiring customers
  • People working full-time and going to school at night

A number of different groups are represented here, and that’s fine for now. Once you get a sketch of who might be interested in your product, you can start gathering data to get more specific about what their possible needs and interests are.

Exercise: Who Do You Help?

Create a list of who your business helps.

Consider what problem you solve and who might be feeling the pain points of that problem. Create a rough list of the types of people who are or could be interested in the solution you offer. 

Having a list like this helps you get more exclusive in terms of whom to target. Instead of thinking about “everyone” being the market for your product, you can now begin to narrow down toward an actual set of potential customers.

This is an edited excerpt from my book Mission, Market, Message: The Actionable Guide to Marketing for Small Business Owners, which you can purchase on Amazon.

Sources

  1. Heath, C., & Heath, D. (2014, August 1). The Curse of Knowledge. Harvard Business Review. https://hbr.org/2006/12/the-curse-of-knowledge;at/1.
  2. Trader Joe’s Demographics and Shopper Insights. Numerator. https://snapshot.numerator.com/retailer/trader_joes