Let me start this video with a quote from management consultant and author Peter Drucker. He said "the aim of marketing is to know and understand the customer so well the product or service fits him and sells itself." I like that quote. I came to marketing through consumer research. I focused on studying customers and understanding their needs. I studied how consumers cook when working for Unilever's pasta sauce division. How they quench thirst when working in a team that developed Ice popsicles. And how they use computers and email when I worked for Yahoo. And much more. While the topics I studied varied, I learned one really important thing. If you can clearly identify and understand the group of people that has a need for your product, the foundation for your marketing campaign is built. This group of people will become the target of your marketing action. At the end of this video, you'll know what marketers refer to when they talk about their target audience and audience segments. Let's start by defining what we mean by target audience. A target audience is the group of people you want to reach with your marketing message, because they may be likely to take action as a result of seeing it. And while you may be tempted to say that your audience is everyone, that's not realistic. Not everyone is interested in every product. And as a marketer you will have a limited budget, so you don't want to waste your precious marketing dollars and time on people that have no need for your product. You want to try to reach those people who are most likely to be interested in your product. People in your target audience will have certain characteristics in common. These characteristics usually fall into three broad categories. First demographics, they may have the same age, gender, household, income, occupation, education, and location. People in your target audience may also be described based on interests they share. They may all be interested in certain products, topics, or activities. Or they may share certain behaviors. Maybe they read the same publications, visit the same online destinations, have certain hobbies, or play the same sports. In marketing you'll hear people refer to groups of people with similar characteristics like demographics, interests, or behavior as segments. Your target audience is thus a segment of the population you want to reach with your marketing message. Identifying and describing your target audience based on these characteristics will help you develop your marketing. Let's look at an example. HelloFresh is a leading provider of meal kit subscriptions. They delivered fresh ingredients for meals with recipes and instructions to cook a full meal at home. According to HelloFresh, their target audience is women between the ages of 30 and 50 with a busy lifestyle. Does that mean that no men in the 65 plus age group would be interested in their meal kits? No, probably not, but they decided that group of people most likely to buy their meal kits are busy women between the ages of 30 and 50. So they decided to spend their marketing dollars on messages targeted to that group. It is possible for a company to have more than one target audience, but usually there's one target audience that company is most focused on, that's the primary target audience. A primary target audience will typically get the most attention, since the people in this group are expected to become your most valuable group of customers. Secondary target audiences are other groups of people with common characteristics who may be interested in your products or services, but are unlikely to become your most valuable customers. Secondary target audiences can help you structure your marketing efforts. Especially, if you sell more than one product, or service, or if you feel your products or services may appeal to distinctly different groups of people. Let's take another look at Calla & Ivy, the flower business we introduced in our previous videos. Remember how Imra is setting up the website for the business so she can sell her flower bouquets online. She has planned some marketing for the website. And in order to spend her money wisely, she wants to target people who are most likely to buy her flowers online. Based on her experience with the customers in her flower shop in Amsterdam, she decided to define her primary target audience as follows. Women between the ages of 30 and 55 who live in urban areas have some higher education and who are interested in interior design. But she's also learned over the years that men visit her store to buy flowers for special occasions, birthdays, Mother's Day, Valentine's Day, etc. Or sometimes just to surprise a loved one. So she decided that it would be good to define a secondary target audience that she would direct her special occasion and gift giving campaigns to. She describes this target as professional men between 35 and 65, who live in urban areas, and who commonly give gifts. Having these specific targets in mind helps in Imra think about her marketing. In fact, the more specific you can be in describing the target audience, the better. In our next video, I'll walk you through the steps you can follow to create your target audience.