Prioritising target markets

Target marketing is a key decision area for all businesses. Market size, growth rates, competitive forces, customer fit and profitability are just a few of the criteria which can be used by businesses assessing the attractiveness of their target markets. Yet despite the wealth of variables available to managers and the development of a range of decision tools to help them, research indicates that many businesses continue to assess target markets on the basis of short-term profitability measures. This paper examines the wide range of approaches which have been proposed in the literature for identifying market attractiveness and questions how these fit with managerial practice, utilising the findings from cases and two studies of The Times 1000 UK companies’ target market approaches. The studies’ findings indicate that the literature's formal, multi-criteria tools for assessing market attractiveness are not necessarily reflected in the simplistic view adopted by many marketing professionals and brand managers. The paper concludes by offering a research agenda to help define future work in this area.