Do You Really Know Your Customer and Market?

Quick, without thinking about it, answer these questions: How well do you really know your customer? Are you truly solving a problem that keeps them up at night?

Identifying customer needs and wants isn't hard, but it does take some work. Peter Drucker, the management consultant and author said it best:

"The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself."

Amazing things will happen when you truly know your customer base and how they measure success. You'll develop better solutions to their problems and understand how to sell them. Leading to great success for you and your business.

It starts with understanding your target audience and what they want – as well as what they need - and what they are willing to pay for a solution to their problems. You'd think that if you just do a little customer data mining, then creating a solution to the problem they face should be simple.

Well, maybe.

Undoubtedly you have a wonderful concept and technology. Perhaps it's even unique. But is that what people want and is it enough to be successful? It's important to ask yourself these questions and be honest with the answers, but first do your research.

Go ask your potential audience. Because if your target market has other ideas as to what works for them and what doesn't, then you are in deep trouble, before you ever get started!

Think Like an Investor

The first thing many investors want to figure out is if you know your customer and how compelling and irresistible your market finds your offering.

In my Selling Value article, I touched on the fact that there's only a few things that will catch someone's attention - saving them money, making them money, saving them time, and solving their problem better than anyone else can. Of course it goes a little deeper than that.

It's important to understand your target audience and their problems – totally. A good way to test your current beliefs on this is to get ready to pitch a venture capital investor, even if you are a long way from needing to raise money or never expect to.

Why? Because although you may believe that your solution will be a big hit, those darn venture capitalist and investment bankers might not. They are very stingy with their money and ask very hard questions, such as, do you know your customer!

Maybe they just enjoy tripping us up to watch us sweat. Trust me when I tell you this; I've made over a hundred presentations to investors and they're a tough audience.

Make sure that identifying customer needs is a very high priority. These are the questions you need to clearly answer:

  • What is the problem you are solving?
  • Who has the problem?
  • Why do they have the problem?
  • What metrics do these customers use to measure success?
  • Is the problem worth solving for your audience, why is it compelling?
  • How many have this problem, how big is the market?
  • What information are you relying on to ‘prove' that your market exists, is large enough, and will buy from you?
  • How much is your audience willing to pay to solve their problem?

Investors ask other questions too, such as how does your business model make money and what sales strategy and tactics will you use to get your solution to the market. I'll cover those topics in other articles.

Do you really need to answer all these questions? Only if you want accelerate growth and revenue! Do your homework, talk to your market, and you'll be rewarded. This is the bottom-up way to attack a market. But the bottom line is get to know your customer.

Many people have an idea and then convince themselves that it is a huge marketplace and they can make it big by taking only 10% of the market. But the truth is that usually they really haven't solved a problem uniquely enough, at least not as far as prospective customers are concerned.

You will build a strong foundation for success if you make identifying customer needs a priority. It's simple; just know your customer better that they know themselves! 

Other Articles You'll Enjoy:

Tips For Identifying Ideal Customers – Part 1 
Defining your perfect prospect profile is the first step to an effective marketing message that will turn prospects into buyers.

Free Market Research Sources to Help You Stay Competitive 
These free market research sources will help you keep a finger on the pulse of your industry and competitors too.

3 Tips For Identifying Customer Needs 
Asking questions is critical before you launch your company or new product. But what are the correct questions to ask?

6 Questions you need to answer to create a dazzling value proposition 
This checklist will help you get potential customers to say WOW!

The Secret of How to Sell More Products 
It's important that sales and marketing act as a team and be in sync. Here 4 reasons why you need to make this happen now.

Is Your Sales Funnel Full of Dirty Data? 
4 tips for improving the quality of your sales lead database that will close more deals.

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