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Deciding which customers to serve is a defining aspect of a company’s strategy. It influences all other aspects of the target market—competitors, collaborators, the company’s resources necessary to serve these customers, and the context in which the company operates. The fundamental role that identifying target customers plays in defining a company’s business model highlights the importance of applying a systematic approach to targeting. Accordingly, this note outlines the key steps in the process of identifying target customers and illustrates the process of segmentation and targeting with a concrete example. This note is an excerpt (Appendix A) from Strategic Marketing Management: Theory and Practice by Alexander Chernev (Cerebellum Press, 2019).
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