Knowing your customer – your first move
Table of Contents
So you have an idea to start your business. You are immersed in a sea of eagerness and some worries (might be). Many questions are raised, many plans are shaped. But I would recommend you to sit down and pay sometime to answer these questions. They are VITAL to your soon-be-born business.
Who are your potential customers?
Note down as much as you can for your potential customers. They can be business or individual? How can they use your product, for which purpose?
For example, when I was selling water purification system (you can imagine it would be big as a car), our team brainstormed and jot down these potential customers:
- Household (might be villa, or quite big house)
- Apartment building owner
- Hotel
- Public office (Hospital, Airport lounge, city hall…)
- Company
And then comes to 2nd question:
What’s their pain point?
To know exactly what irritates your customers, the best method would be doing survey: individual interview, online questionnaire, group discuss… These methods are quite theoretical. Because it is time consuming, people often drop it and opt for online research such as reading comments, feedbacks from similar product/service to know what’s potential customers need. I suggest you to combine both methods if possible. You can figure out what’s your potential customers want by online research, but talking directly to them would expand your view and might bring some new ideas.
How many of them?
Of course if number of your potential customers is small, your business would not be profitable anymore. Calculating roughly about your market size is as important as to know your customers’ problem.
So how to calculate your ‘blue sea’?
If you already targeted your direct competitors, basically you can measure your market size based on their report. You can check e-commerce platform to know how well they are selling (if you provide physical products). You can research how many downloads of the similar software in an apps store (if you sell application).
You might ask, If there is no statistics or research number about my market, what should I do? In case of that, I’d like to introduce you the Fermi problem."How Many Piano Tuners Are There in Chicago?"
Based on public information and logic, you might get the answer for your question.
What’s your typical customer’s portfolio?
And finally, it’s the time to draw a portrait of your customer. People often get accustomed to a description like this: “A female in her 30s, living in Chicago with husband and 1-2 kids. Her household income is more than 200,000 USD per year”. It’s just one side of a hand: the demography description of your typical customer. The other is what we often miss: Emotional or spiritual life of your targeted customers.
For example, if we are selling a new brand perfume for the above woman, this is what we can describe her: “A female in her 30s, living in Chicago with husband and 1-2 kids. Her household income is more than 200,000 USD per year. She loves fashion. She goes to mall center to check out new outfits once a week. She can wear different types of clothes from long dresses to jeans because she feels herself as dynamic person. At work, she is a positive and full-energy person who loves working in team. She likes playing sports. She might be a premium client of an indoor gym”….
This description can still be going. From this portfolio, you can define Place, Price and Promotion of your Product (You might know 4P in Marketing). Your budget can also be adjusted based on how close a typical feature to the group feature.
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It’s not easy with the first step, but the clearer image of your customer you draw, the less time you pay to revise your business in the future. Therefore, think about it carefully before you actually start.
If you are done with this, let’s get on the train to explore what to do next!