Journey of a Serial Entrepreneur

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How to get from where you are to where you want to be

Who is your customer?

“The road toward being successfully different usually involves one of three broad initiatives: leveraging a deeper understanding of customer needs; exploiting a deeper understanding of industry economics; or simply having the courage to challenge conventional wisdom-to overturn “the way we’ve always done it.” David Rhodes, Michael Ackland

On the surface this seems a trivial question. Everyone has a vague idea about who their customer is. Ask any business owner or entrepreneur and the answer will vary according to their respective businesses. Answers I hear often are, Small Medium Enterprises (SME), Multinational Companies (MNC), Teenagers, Baby Boomers or Technology Enthusiasts. A lot of the businesses then proceed to market and pitch to everyone in their market segment. Eventually they find themselves back at the drawing table wondering why their product/service is not selling. The fact of the matter is, many smaller and younger businesses hardly ever invest the time to research and find exactly who their customer is. Going after broad segments like SMEs or Teenagers is suicidal for most start-ups, this takes up a lot of resources and is unable to effectively cater to such a large target audience. 

When an organization is developing its Customer Value Proposition (CVP), this question needs to be talked about and researched in great deal. This will not only save time and resources, it will provide a foundation to effectively market and sell your product/service. Some key concepts to keep in mind when mapping out your target customer are:

1. Be specific: Targeting everyone, with limited resources, is a strategy with a low success rate. Evaluating your product/service needs in-depth analysis of those who will most benefit from what you have to offer. Being specific will allow you to zone into a segment, and develop a niche, in the long run this will also develop into a competitive advantage. Some key concepts to keep in mind when profiling your target segment are:

2. Understand who your target customer is: Say for example, your organization provides services related to alternative advertising. Your target customers are SMEs with a turnover of less than $2m with products targeting the 18-24 demographic. To successfully sell your services, not only will your organization have to understand the SME’s marketing patterns but will also have to understand who their target segment is. Failure to do so will create a mismatch between what you propose and what is required.

3. Understand your target customers needs: It is essential that you satisfy your target customers needs and requirements. Sometimes these needs will be lower prices, higher quality products, 24/7 customer service support, environmentally friendly products or other specific requirements. Not understanding your prospect’s needs,  will cause a gap in your selling strategy. These will in turn, result in low conversion rates and directly impact the success of your business.

4. Research your target segment: To truly understand your customer, in-depth research is vital. This research must include maximum data collection, ranging from company size, turnover, organization structure, decision makers, influencers, press releases and product/service information. I like to build customer market research files, in which we gather data on all major players in our target segment and document them on a single sheet of paper for easy reference. 

Successful profiling of your target segment is an arduous task at the start of a venture. Many questions will come to mind, such as, “Are we limiting our target segment too much?”, “Is this a profitable segment to be in?”, “Am I sure who my target segment should be?”  as well as other such questions. These questions are good, they show a conscious effort to find the answers to the questions at hand, it does take time and experience to find these answers . However, if you adopt a “see how it works” strategy, document all your feedback and findings. Once you have collected substantial data, convert it into finding the segment you should be operating in as soon as possible. 

So who is your customer? 

Related Posts:

The Customer

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One Response

  1. […] 1. Customer Identification: Who is your target customer? Instead of answering this question with generic answers such as multinational companies, teenagers or women, be more specific in your approach. An analysis outlining the customer’s needs and their current pain points is the need of the hour. If your product/service does not fulfill a need, it will be difficult for your organization to generate substantial traction. Therefore, the first step requires understanding your target customer and ensuring that the essence of your CVP reflects an unfulfilled need. To read more about customer identification please click here. […]

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