I was speaking to a client recently about our plans to create a new website for his business. I had asked him if I could speak to a salesperson; someone who had lots of experience with the site's target audience. My client said, "Oh, I don't think you need to spend time on that--I'm the target audience." Well... Yes, it's true, he is an educated, affluent professional, skews male, has deep academic and medical credentials, and lots of other similarities to the target audience. But he's not the target audience.
For one thing, he's not buying what his company sells, he's selling it. And he knows far too much about the inside of his company to see it as an outsider. He's making an assumption that is natural and very common: because he's like his intended audience he knows how they think. This is not true. Nor is it true that his aversion to the color orange and preference for blocky, geometric typefaces are shared by the majority of the site's visitors.
So I diplomatically pointed out that it's best to always observe the rule that you are not your target audience. There's only one way to find out who the target audience is, and that's research. Ask them through a survey on the site, an email questionnaire, a telephone survey, or face to face. Look at the site's user logs, look at what they like to read, buy, eat, watch, wear, and so on.
These techniques lead toward the creation of a "persona", which is a representative aggregate in the form of one character, usually with a name that adds to the description, like "Simon"; and to a "brand board", which is an assembly of visual references that describe the audience's preferences. Both of these are referred to constantly during the process of development. Sometimes there is more than one persona if the project has multiple target audiences.
Ultimately, what validates the efficacy of the approach is testing on real people who fit the description of the target audience. And this always results in valuable insights, which we act upon as we finalize the site for launch. After launch we watch the site's traffic and pay attention to feedback to keep refining and adjusting as we get more input from the real audience. The REAL audience. From them and for them, we create a site that's just right.