In my travels and business adventures since I sold Daycom Systems, I once had the pleasure of meeting a very successful venture capitalist who handed me his unique business card. What was unique wasn’t on the face of the card, but on the back. There he had five words in a particular order: Market, Team, Product, Strategy, & Execution. Why? It was the order in which he examined opportunities for investment.
Since he’s considering investing millions of his, and others’, hard-earned money, it might make sense for you to look at your business in those same steps, right? In this post, we’re focusing on the first – Market. Clearly, he ranked it as the MOST important by listing it first, so let’s dive in.
- What, who, and where is your market?
- What problem are you solving?
- Who is going to buy your product or service?
- How will you reach them?
- Who buys from you now?
That’s your market – in the simplest terms. Learn it, understand it, and know how to reach it well if you’re to be successful in your business.
Some markets are huge and widespread, and some are tiny and very specialized. This matters the most when it comes time for pricing, sales projections, profits, and a business plan. A huge, wide market will require a massive marketing strategy, and likely will sell large volumes of goods at low margins. A narrow, specific, niche market will generally yield higher margins and lower unit volumes.
Consider the demographics. How old are your buyers? Male, female, retired, working? Where do they live? Does it matter? What’s their education, income level, race or ethnicity? What industry do they work in? Are they married, single, divorced, gay, straight, have kids?
What do they do in their spare time? What other types of products do they buy? What else competes with your solutions for their attention?
OR, maybe it’s not about what they do now, but their history – where they have come from – literally or figuratively. Or where they’d like to go (and you can help them get there).
The finer you can hone down this picture, the better, in order to differentiate them from the population at large, to get to know them better, and to spend your marketing funds wisely to reach them.
Search online for demographics, census data, etc. Put together a focus group of your existing customers and look for common threads. Then, how do you follow those threads outside your customer base, and find those people in the general population? What do they read? What association or alumni memberships do they have? What blogs, podcasts, or social media do they use? Where do they gather? How do they communicate? Who are their heroes?
Look up your products or your competitors’ products online. Then pay attention to reviews, or “people also looked at….” on e-commerce sites. What else are they buying in conjunction with your product or service? How about instead of your product? Why? Find out. Look up related online discussion forums.
Who are the thought leaders, sponsors, or stars of your product or service in your industry? What can you learn from them about the way they operate? What’s made them successful? What mistakes have they made? And how can you bit just a little bit different?
You know by now I’m a huge believer in revenue and sales. Knowing your market intimately, expertly, is the first step in building a Performance Business. What they want, where to find them, and offering products and solutions that fit them – this is paramount.
Maybe that’s why my venture capitalist buddy had it listed first on the back of his business card. Yep, pretty sure that’s why.
What about you? Do YOU know your market? What tools have you found helpful? What did I miss? Please do share so we can all learn. I look forward to your comments!
Make it a great day.