Abstract
As SMEs are the drivers of employment and GDP in many cases, SMEs are also critical to the development of any economy and their survival and success are, thus, important. With the high levels of failure of SMEs, it has become imperative that there is a drive to ensure the survival of SMEs. A way in which SMEs, can enhance their potential success rate and business performance is by means of proper target market selection in order for the business to focus their marketing efforts. This will allow the business to timeously identify opportunities and threats in the market and to react to these situations. The business will also have a greater understanding of their target market, and their needs and wants. Understanding the target market will assist the business in developing marketing strategies that are suited for the target market and enhance its chances of success. This study aimed to identify whether SME owners and managers have target market knowledge within a South African SME context. The main results indicate that although SME owners and managers claim they are aware of their specific target markets (90%), they do not have customer knowledge regarding the psychographic and demographic aspects of their target market. By using effective target marketing communication, SMEs can improve on their merchandising planning and product assortment and offerings to better serve their target market(s). Keywords: target marketing, SMEs, South Africa. JEL Classification: M310, L26
Highlights
Small to medium size enterprises (SMEs) are considered the backbone of any economy, as they drive sustainable growth and are major contributors to employment in any economy (Caan, 2013, p. 57; Chimucheka, 2013, p. 784)
They further define SMEs as “a separate and distinct entity including cooperative enterprises and nongovernmental organizations managed by one owner or more, including its branches or subsidiaries if any is predominantly carried out in any sector or subsector of the economy mentioned in the schedule of size standards and can be classified as a SME by satisfying the criteria mentioned in the schedule of size standards” (Government Gazette of the Republic of South Africa, 2003)
The majority of the respondents disagree and strongly disagree with these statements “I know how many vehicles my customers have” (68.9%); “I know if my customers rent or own a house” (64%); “I know what type of housing my customers occupy” (58.4%)
Summary
Small to medium size enterprises (SMEs) are considered the backbone of any economy, as they drive sustainable growth and are major contributors to employment in any economy (Caan, 2013, p. 57; Chimucheka, 2013, p. 784). In South Africa, SMEs are defined by the National Small Business Act 102 of 1996 as “a business enterprise that employs no more than 100 employees” They further define SMEs as “a separate and distinct entity including cooperative enterprises and nongovernmental organizations managed by one owner or more, including its branches or subsidiaries if any is predominantly carried out in any sector or subsector of the economy mentioned in the schedule of size standards and can be classified as a SME by satisfying the criteria mentioned in the schedule of size standards” (Government Gazette of the Republic of South Africa, 2003). Independent of the firm size, turnover, decision making processes and trading styles, it is necessary for organizations to investigate their macro and micro environmental obstacles. The macro environmental obstacles that SMEs are battling with included lack of access to finance, high interest rates, high inflation rates, unemployment, lack of support from government, government legislation and crime (Brink, Cant & Ligthelm, 2003, p. 1; Cant & Wiid, 2013, p. 713; Olawale & Garwe, 2010, p. 734)
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
