How Smart Brands Nail Their Target Market (With Real Examples)

Why “Everyone” Is Almost Never Your Target Market

If your business plan says your product is for “everyone,” that’s usually a red flag for investors. It sounds ambitious, but it screams lack of focus.

Real markets are made of specific people:

• With a particular problem
• In a particular context
• Willing and able to pay a particular price

The art is not in describing the whole world. It’s in choosing the slice where you can actually win.

Let’s walk through how that looks in real businesses, not just textbook diagrams.

Example 1: Boutique Fitness App That Stops Chasing “All Fitness Lovers”

Imagine a new fitness app. The founder’s first instinct: “Our target is people aged 18–65 who want to get fit.” That sounds broad and optimistic, but it’s useless for a media plan, pricing strategy, or product roadmap.

So they narrow down step by step.

Step 1: Start with behavior, not just age and gender

Instead of “everyone who wants to get fit,” they look at:

• People who already use workout apps but churn after a month
• People who follow fitness influencers but don’t stick with programs
• People who prefer home workouts over gyms

They analyze app store reviews of top competitors and see repeated complaints: “Workouts are too long,” “No time with kids,” “Too advanced,” “I feel judged,” etc.

A pattern emerges: busy parents, especially moms, who feel traditional fitness apps don’t match their reality.

Step 2: Turn observations into a clear target profile

Instead of “fitness users 18–65,” the business plan now describes:

Primary target market: Women aged 28–42 in the US, with young children at home, mid-income households (\(60k–\)120k), who have tried at least one fitness app in the past year but stopped within 60 days. They prefer home workouts, feel short on time, and are more motivated by energy and stress relief than by aesthetics alone.

That’s much more actionable. You can picture the person. You know where she spends time online. You can test messages like “10-minute workouts between nap times” or “No gym. No judgment. Just real-life movement.”

Step 3: Use data to stress-test the segment

To check if this target market is big enough and growing, the founder might pull data from sources like:

• U.S. Census Bureau for counts of women 28–42 with children
• Bureau of Labor Statistics for work and time-use patterns
• Industry reports on digital fitness and wellness

Herkenbaar when you realize how different this is from “people who want to be fit”? This kind of specificity is what investors and lenders expect in the market analysis section.

Example 2: B2B SaaS Choosing Between “All SMEs” and a Real Beachhead

Now picture a startup selling workflow automation software. The founding deck says: “Our target is all small and mid-sized businesses that use email.” That’s basically every company on earth.

That kind of vagueness makes sales cycles long and marketing budgets vanish.

Finding the first wedge into the market

The team looks at:

• Early pilot users
• Win/loss notes from sales calls
• Which prospects respond fastest

They notice that mid-sized accounting firms (20–100 employees) are converting at higher rates. Why?

• Heavy document flows
• Lots of repetitive work
• Strong pressure to reduce manual errors
• Clear ROI story around time saved per staff member

So instead of “all SMEs,” they sharpen the target.

Primary target market: Independent accounting and tax firms in the US with 20–100 employees, using cloud-based accounting platforms, handling at least 500 client files per year, and actively hiring to manage workload.

Secondary markets (law firms, consulting agencies) stay on the radar, but they’re not the focus for year one.

How this changes the business plan

Once the target market is this specific, the market analysis section can:

• Size the market using IRS practitioner data and industry statistics
• Name direct and indirect competitors in accounting tech
• Show realistic adoption patterns and pricing expectations

Messaging becomes sharper: “Cut client onboarding time by 40% this tax season” resonates far more with an accounting partner than a generic “Automate your workflow.”

Klinkt logisch, toch?

Example 3: Sustainable Skincare Brand That Stops Targeting “Women 18–45”

A new skincare line using eco-friendly ingredients wants to sound inclusive: “Our target market is women 18–45 who care about their skin and the environment.” That’s basically an Instagram hashtag, not a market.

The founders run surveys, read dermatology resources like NIH articles on skin health, and talk to early customers. They discover two very different clusters:

• Ingredient obsessives who read every label and research each chemical
• Skin sensitivity sufferers who are desperate to avoid flare-ups

The second group shows much higher purchase intent and repeat use.

Sharpening the focus around a clear problem

The team rewrites its target market like this:

Primary target market: Women aged 25–40 in urban US areas with self-reported sensitive or reactive skin, high smartphone and social media use, mid to high income, who have tried at least two brands labeled “gentle” or “dermatologist tested” in the last 12 months and still experience irritation.

Notice the shift:

• It’s about a chronic problem (sensitive skin that flares up)
• It’s anchored in past behavior (multiple failed tries)
• It hints at emotional drivers (frustration, distrust of big brands)

Marketing content can now address, very directly, the fear of breakouts and the trial-and-error fatigue. The brand can cite sources like the American Academy of Dermatology to back up claims about common irritants, building trust with this specific audience.

Example 4: Local Coffee Shop Competing with Big Chains

Not every target market story is digital or global. Take a neighborhood coffee shop surrounded by big chains. The owner could say, “Our target is everyone who drinks coffee in a 5-mile radius.” That might be technically true, but practically useless.

Instead, they study foot traffic and receipts for a month:

• Office workers grabbing coffee between 7:00–9:00 am
• Students camping out with laptops mid-day
• Parents with strollers between school drop-off and lunch

Choosing who you really design for

The owner can’t optimize the space, menu, and pricing for all three equally. So they decide to prioritize:

Primary target market: Remote workers and graduate students within a 2-mile radius who need a quiet, reliable place to work for 2–4 hours, Monday to Friday, and who are willing to pay a premium for high-quality coffee, stable Wi-Fi, and comfortable seating.

Now the shop can:

• Add more outlets and larger tables
• Offer a “bottomless filter coffee” workday option
• Partner with local universities for student promos

Sure, office workers and parents are still welcome. But the business plan and financial projections are built around the segment most likely to drive consistent weekday revenue.

Herkenbaar for a lot of local businesses that try to be everything to everyone and end up blending into the background.

Example 5: Health-Tech Wearable That Stops Chasing Early Adopters Only

A health-tech startup develops a wearable that tracks sleep, heart rate, and daily movement. Their early adopters are obvious: fitness enthusiasts and tech lovers.

But when they start looking for a larger, sustainable market, they notice strong interest from a very different group: middle-aged adults with early signs of cardiovascular risk.

They study public-health resources like the Centers for Disease Control and Prevention for prevalence of hypertension and heart disease risk factors by age and income. They combine this with internal data on who actually keeps using the device for more than six months.

Redefining the target with health outcomes in mind

The business plan now describes:

Primary target market: Adults aged 45–65 in the US with at least one risk factor for cardiovascular disease (e.g., elevated blood pressure, overweight, family history), smartphone users, insured, motivated to avoid medication or surgery, and open to lifestyle changes.

The wearable’s value proposition shifts from “cool fitness tracking” to “daily feedback that helps you keep blood pressure in check and have a better appointment with your doctor.”

This opens doors to:

• Partnerships with healthcare providers
• Employer wellness programs
• Integration with telehealth platforms

Suddenly, the company is not just selling gadgets. It’s embedded in a healthcare ecosystem with measurable outcomes.

How to Structure Target Market Identification in a Business Plan

So how do you pull all of this into a market analysis section that doesn’t read like a vague brochure?

1. Anchor on a specific problem

Every strong example above starts from a real, specific problem:

• No time for long workouts
• Overflowing client workloads in firms
• Constant skin irritation
• Need for a stable work-friendly space
• Fear of long-term health issues

If you can’t describe the core problem in one blunt sentence, you’re probably not ready to define the market.

2. Layer demographics, psychographics, and behavior

Instead of stopping at age and income, combine:

• Demographics: age, location, income, household status
• Psychographics: attitudes, values, motivations
• Behavior: past purchases, product usage, channels used

Example, instead of: “Women 25–40 in cities.”

You want: “Women 25–40 in cities, juggling work and young kids, who feel guilty about not having a workout routine, follow fitness creators on Instagram, and have paid for at least one workout app in the past year.”

Same size on paper? Maybe. Totally different strategy in practice.

3. Use external data to keep yourself honest

Investors and lenders get nervous when your market analysis is built only on vibes and personal anecdotes.

Bolster your target market description with data from sources such as:

• U.S. Census Bureau for population, age, income
• Bureau of Labor Statistics for work patterns and industry data
• CDC or NIH for health-related markets

You don’t need a PhD-level dataset. But you do need to show there are enough people who actually match your target profile and can afford your solution.

4. Differentiate primary and secondary markets

You can absolutely have:

• A primary target market (core focus)
• One or two secondary markets (future expansion)

What you can’t afford, especially early on, is to treat all of them as equal priorities. The examples above all pick a lane first, then keep others in the wings.

5. Translate the target market into real decisions

If your target market statement doesn’t change how you:

• Choose marketing channels
• Set pricing
• Design features or services
• Staff your team

…it’s just decoration.

Ask yourself:

• Would I still run the same campaign if my target changed?
• Would I still price it this way?
• Would my sales pitch sound exactly the same?

If the answer is yes, your target market is probably still too vague.

Common Mistakes When Identifying a Target Market

You see the same pitfalls over and over in business plans.

Confusing “people who could use this” with “people who will actually buy”

A lot of founders describe everyone who theoretically benefits. That’s far broader than the group who:

• Recognize the problem
• Are actively looking for a solution
• Have budget and authority to purchase

The B2B SaaS example is a classic case. Many industries could use workflow automation. But only a few will pay for it this year.

Ignoring the role of context

Context matters:

• Time of day
• Location
• Life stage
• Seasonality

The coffee shop doesn’t just target “remote workers.” It targets them during weekdays, within a 2-mile radius, for 2–4 hour blocks. That’s what shapes seating layout and opening hours.

Targeting based on identity only

Statements like “millennials,” “Gen Z,” or “busy professionals” are a starting point, not a strategy. They say nothing about:

• What problem you solve
• How they buy
• How much they can pay

Demographics without behavior is just decorating your pitch with buzzwords.

Quick FAQ on Target Market Identification

Do I really have to choose a narrow target market? Won’t that limit growth?

Focusing early doesn’t lock you in forever. It gives you a clear starting point to win a segment, learn fast, and build a brand. Once you have traction, you can expand into adjacent segments with more credibility and better data. Broad ambition, narrow execution.

How detailed should my target market description be in a business plan?

Detailed enough that a stranger could:

• Picture your customer
• Name a few likely marketing channels
• Guess why they’d buy from you instead of a competitor

If your description just says age, gender, and city, it’s not there yet. Add behavior, motivations, and spending ability.

What if I have two very different customer groups already buying from me?

That happens. In your plan, treat them as separate segments. For each, describe the problem, size, and value. Then be honest about which one you’ll prioritize for product development and marketing budget over the next 12–24 months.

Can I use AI tools or generic templates to define my target market?

You can use templates as a starting checklist, but they can’t replace talking to real customers, reading industry data, and analyzing your own sales or usage metrics. Templates are helpful; reality checks are non-negotiable.

How often should I revisit my target market definition?

At least once a year, or whenever you notice a pattern shift: different types of customers buying, new use cases emerging, or major changes in the economy or technology. Your target market is a living part of your strategy, not a line you write once and forget.

Target market identification is not a theoretical exercise you do just to fill a section in your business plan. It’s how you decide who you’re really building for—and who you’re willing to ignore for now.

Get that right, and a lot of other decisions suddenly get much easier.