{"id":17000,"date":"2012-11-27T10:51:07","date_gmt":"2012-11-27T16:51:07","guid":{"rendered":"http:\/\/crowdspring.wpengine.com\/?p=17000"},"modified":"2023-05-23T00:58:41","modified_gmt":"2023-05-23T05:58:41","slug":"small-business-startups-customers-market","status":"publish","type":"post","link":"https:\/\/www.crowdspring.com\/blog\/small-business-startups-customers-market\/","title":{"rendered":"How To Choose A Market For Your Startup Or Small Business"},"content":{"rendered":"

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I’m rarely surprised when a young entrepreneur or small business owner hasn’t fully identified how their new business will make money. But I’m always surprised when that entrepreneur or small business owner has difficulty describing the potential customers for their new business’s products and services. After all, without customers, there is no revenue.<\/p>\n

If you try to sell your products and services to everyone worldwide, you will waste both time and money.<\/p>\n

When you choose a market, you should consider five main factors:<\/p>\n

1. How many customers are in the market?<\/p>\n

2. Can these customers pay for your products or services?<\/p>\n

3. Do these customers have the need you solve?<\/p>\n

4. How many competitors are competing for your customer’s business?<\/p>\n

5. How does your business compare to your competitors?<\/p>\n

Let’s discuss each factor.<\/p>\n

How many customers are in the market?<\/h2>\n

A market can be huge but dominated by only a few players. Or a market perceived to be global can be dominated by a few regions. You must know how many potential customers are in your target market.<\/p>\n

Let’s illustrate with an example – using a fictional new online marketplace to purchase and sell art. How big is the market, and who are the potential customers?<\/p>\n

The global art market is believed to be about $61 billion<\/a> (2011). That’s a pretty significant opportunity, but as we discussed above, the size of the market doesn’t mean that you can ignore defining who your customers are. How will you advertise if you don’t know which market segment you will target? Because there are many different entities and types of customers and artists, with whom will you communicate?<\/p>\n

You can’t simply assume that you will provide a service to the entire art industry – the types of customers in an industry will vary. For example, approximately one-half of the art market worldwide<\/a> is auction sales. The other half is commercial gallery sales. Is your new startup targeting auctions? Commercial gallery sales? Both?<\/p>\n

As you look further into the data<\/a>, you find that about 2.4 million people are employed in the art trade globally, there are 403,000 dealers, galleries, and auction houses, and the top five percent of galleries and dealers account for 70% of all sales.<\/p>\n

The data is a good place to start segmenting your potential customers. Are you targeting the people employed in the art trade? Are you targeting galleries, dealers, and auction houses? Are you targeting dealers who sell a certain amount of art annually? These are all very important questions to help you determine who your customers are.<\/p>\n

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