Know your Market

A surprising number of small businesses actually know very little about their market.

The result is that their marketing efforts lack focus. They waste precious marketing dollars because they have no clear idea which spending direction will give them the best return. Having limited funds for marketing is an even more important reason why you can’t afford to use a ‘scatter gun’ approach in your marketing. Here are some tips on how to define your market more accurately, and how to take action:

A never-ending journey

Learning about your market is an on-going process: it doesn’t end, it just deepens. Remember too that markets change-sometimes quite fast. The better you know your market the better prepared you’ll be for possible changes in direction. The more accurately you can define your market the more success you’re likely to have with your marketing efforts. This is because you can use this knowledge to focus your marketing effort more sharply where it’s going to do the most good and you’ll get the best return for each dollar spent. The golden rule: ask lots of questions and take action on the results.

Can you position yourself clearly?

If you were asked right now what business you were in or what you’re known for, what would your answer be? You should be able to answer briefly, clearly, and without stopping to think. If you can’t, your positioning focus is not sharp enough. In order to sharpen your positioning focus, find out more about your customers.

Use a key focus group

Select ten of your best customers and put these questions to them. Tell them that you’re anxious to improve your business through better service to them. Most people will be happy to co-operate if you approach them sincerely. To thank them for participating, put them in the draw to win two tickets to a sports match, a movie, or give them a small gift of your product/ services-whatever is appropriate to thank them for their time.

• How did they first hear about you? Was it by: National newspapers Community newspapers Radio ads Yellow Pages Word of mouth (recommendation from a friend) Just passing your premises
• Why do they continue to buy from you Service Quality Friendliness Price Other What do they feel you can do to improve?
• What do they read? Find out which publications they read: Major newspapers Community newspapers Trade publications Popular consumer magazines
• What shows do they attend? Trade shows Community events Sports events Conventions
• How can you communicate with them? Would they be happy to receive information by: Letter Phone calls Emails Visits by you or a rep
• How else could you help them? Longer trading hours, different trading hours Better after-sales service More regular contact Offering extra products or complementary products or special deals Inviting them to exclusive ‘preferred customer previews or sales of products

Learning as much as you can

By this stage you can probably think of more questions you could ask them that spring from the nature of your particular business. It’s not hard to think of how you can put the information to use. The point is that you’re on a quest to find out as much as possible about your customers. You want to find out what they like, and what they read (so you know where to advertise for best results). Find out which professional, business or community service groups they belong to and you could advertise in their newsletters, or get invited as a guest speaker, by becoming the ‘expert’ in your field. If they read up market publications and magazines, then you should communicate with them in the up market language they prefer. If they read more down-to-earth publications then you adjust the tone of your communications accordingly.

Sharper marketing focus equals better dollar spend

The more you know about your customers and what they think, need and want, the better focused and more effective your marketing can become, because you can focus on fulfilling those needs and wants. You can speak to them in the language they like. Studying the answers to the questions you ask will also give you a clearer picture of your own business and how you should be positioning yourself to best meet your market. Some of the answers are bound to surprise you. Some will open immediate business opportunities because you will suddenly realise that along with product X you should be selling product Y, because they are complementary. Sometimes you’ll also be able to change aspects of your business that have been putting people off without you even realising it.

For example, your trading hours may be inconvenient. People might find it hard to park near your business. They may find it hard to reach you by telephone because the lines are always busy, and so on. By finding ways to work round these problems you can significantly change the attractiveness of doing business with you, and hopefully your turnover, often at little or no extra cost or inconvenience to you. In other cases you may not see a way to get an immediate benefit from the information you gather, but it all steadily builds up in your mind a more accurate knowledge bank in your mind of your customers.

The most successful business people

The most successful businesses have this in common: they take the trouble to learn a lot about their customers, they know a lot about their customers and they put that knowledge into action. That last part brings us back to the golden rule. The golden rule is: ask lots of questions AND make sure you take action on the results.

Reproduced with permission from the Business Information Zone.