Is There a Need for Another Web Design Company

That is the big question. I was told the story of another small business hopeful, this person wanted to become self employed as a domestic cleaner. She did everything right , leaflets , newspaper adds and yet no calls.
My opinion about the above situation is that she did everything right, but just in the wrong place. The area she was targeting is a relatively deprived area , who's going to spend £10 per hour on a cleaner? Yorkshire in general does not have a large disposable income.

With regard to myself and setting up a web design business things I need to identify are

• Target market
  
• Best way to reach this target market
• Most cost effective way to reach target market
• What prices are people willing to pay