A study of brands and their 2012 profits has revealed there is a veritable sweet-spot to be found in brands that target the mid-income market. This income bracket catapulted 7 of their favourite brands to the top 10 global brands.
So what does this tell us about these consumers as a target market? Just how much can we learn about our target market when we look at their spending habits?
The Most Profitable Target Market
This research shows that middle-income consumers make up the largest part of the market. It is noted that 22.5% of the global population falls into the middle-income category. This means there are a lot of potential consumers in this income range.
Consumer Preferences
This research looked at what it was that this market chose to buy, and found that the majority of their preferences lay in experience-based activities and products that could deliver reliably over the longer term rather than lower cost, less reliable products. Travel, education, sports and recreation, products such as the iPad and MacBooks that were entertaining and gave lasting satisfaction, were all leaders in this area. So we know that this sector of the market likes practical products and are looking for lasting satisfaction from their purchases.
Identifying with the Target Market
This research reflects much of what we can learn from smaller consumer panels. Consumer panel surveys teach us a lot about how preferences shift towards quality, value and the perception of brands. Has something become a status symbol? Is this brand perceived as a purveyor of good value?
Findings like this suggests that the middle-income are concerned with long-term goals. They are more likely to invest in secure products and make calculated purchases; they’re more likely to invest in housing for example. Lower-incomes are more preoccupied with ostentatious branding and, interesting, are more likely to purchase a car as their first major investment.
Knowing Your Target Market
If we know how people are buying, we can tell so much about the market for our products and services. Taking the time to learn what is important to our target market, whether its branding, value or status, teaches us so much about our advertising, marketing and brand awareness.
You can easily learn this type of insight about your target market by surveying a consumer panel. While this research shows an overall trend, it generalises factors such as location and leaves out what could be crucial influencing factors such as employment, travel habits and family. Your consumer panel can zoom in on these influencing factors and give you an insight into what are the real needs and wants of your target customers.
Have you decided to do a bit of your own market research after reading this article? Our free whitepaper on Conducting Consumer Research in the UK should be able to help out with that.