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Also known as a marketing profile, a market profile is a summary of the essential characteristics that define a given market. While the scope of this type of profile will vary somewhat based on the type of market under consideration, there are several essential pieces of information that are generally included. Market profiles are used by businesses to identify specific groups of potential consumers, assess their status in comparison to other companies that offer similar goods and services, or to evaluate the feasibility of launching a new product in a specific location.
One of the key factors of any market profile is to create a working image of the ideal customer. This will often include defining the age and gender of individuals most likely to be attracted to a given product. At times, factors such as ethnic background, race, geographical location, orientation or religious preference may also play a role in developing this type of market profile. It is not unusual for income level to also be included in the creation of this type of profile.
For example, a company that produces gardening equipment may conclude that a customer who is highly likely to purchase a particular gardening implement from their product line will be a male over the age of fifty. This ideal consumer will also live in a suburban area, have an income that is considered middle class, and enjoys vegetable gardening as a weekend project. If this is the consumer that research indicates is most likely to buy the implement, the marketing campaign will be designed with the goal of attracting customers who meet this market profile.
A market profile does not have to be focused on a customer. The profiling approach can also be applied to evaluating the competition within a given market. Here, the idea is to determine if the product line of a competitor is likely to attract the same general types of consumers. If so, the analysis will go one to determine which of the two companies is positioned to capture the majority of interested consumer groups, usually by examining retail patterns over the last several years. Here, the idea is to strengthen the presence of a given company within an industry, and allow it to at least capture a greater market share.
The process of market profile may be an evaluation of the marketplace in general, involving both elements of typical purchaser information along with typical competitor information. The idea is to take this data, relate it to general economy information, and determine how to go about promoting the products offered by the company in the current economic climate. With this approach, projections of consumer spending take into account such factors as the current pricing for goods and services, the rate of production among the top competitors in the marketplace, and whether the general economy is currently in a state of inflation or recession. A profile of this type makes it easier to conform future production to meet anticipated demand, and thus maximize the potential for the business to remain profitable.
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