These days it comes down to trial, error, and data analysis. You can use old-school methods of market research and customer survey, and these can provide valuable insight if your store has been in the market for a while. But for new stores and people working on a budget, it’s much easier and more effective to work alongside a digital marketing agency that offers analytics consulting services.

Digital marketing agencies can set up various small PPC campaigns targeted at different consumer bases and then crunch the numbers to see which demographics yielded the best results. Metric Labs is a good example of an agency that offers this kind of service.
Since figuring out which channels to use and which demographics to target is the most skill-intensive part of the digital marketing process, many businesses have taken to hiring digital marketing agencies to help them with this part of the work, before switching to handling digital marketing in-house using the data and strategy provided by the agency.