Unit 4: Chapter 16

Many different types of people buy from many different businesses. Ideally, your business should cater to all types of people, however, targeting specific groups of people can sometimes be more beneficial. A company that appeals to as many people as possible is called a mass-market. A company like Amazon would be considered a mass-market, as they have many different services and products which cater to different people. Appealing to a mass-market takes lots of time and resources, and is generally only effective in large businesses. 

For small businesses, it is much more effective to focus on a target market. A target market is a group of people who are likely to be interested in your product or service. Customers from a target market will usually give you more business more often. Businesses that focus on a target market still sell to everyone, but put more time and effort into their target market. When focusing on a target market, making a customer profile can help when deciding what to focus on. A customer profile is a description of your target market. A good way to generate customer profiles is through customer surveys. Building a customer profile is a good first step for going into a target market.

There are two main types of customers in business. Companies either sell to consumers (B2C) or other businesses (B2B). B2C companies are what generally comes to mind when thinking of companies. B2C companies include restaurants, stores, and anything that sells directly to the consumer. A customer profile for a B2C business should include things like age, gender, status, hobbies, etc. B2B businesses sell to other companies instead of directly to consumers. A customer profile can be made for types of businesses as well, with information such as business size and industry. Businesses are typically willing to spend more money on high-quality products or services than consumers. Businesses also are more consistent with their purchases. Making a customer report that is relevant to your business is very important for long term success.

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