The size of a business doesn’t always determine how successful it is with its customers.
Many small businesses offer a good service and have created a loyal band of followers. But like any on-going relationship you have to work at it, so it’s important to know exactly how well your particular product or service matches what customers want and value.
A couple of good examples of this are Uber taxis and Starbucks. Uber has enjoyed considerable viral success because it offers a cheaper, more convenient service than other taxi companies, something that its customers obviously appreciate and choose to support.
On the other hand, Starbucks, an extremely successful US coffeehouse franchise, hasn’t done very well in Australia. This is because people here are more picky about their coffee and prefer buying a brew from their favourite local barista rather than a big chain outlet. The result? Starbucks was forced to close half of their Australian stores. If they’d done their target market research beforehand they could have saved themselves a lot of money and energy.
The upshot of this is that smaller companies often get it right over larger ones because they are offering exactly what their customers want. But how do you go about keeping everyone happy and still make a profit? Let’s break it down into 3 steps:
As a small business you can’t sell to everyone but knowing who your target customers are and what they want means you don’t have to. For example, your local coffee shop doesn’t need to sell to everyone in the city to be a successful, profitable business and it’s likely that your business is the same. Focus on your ideal customers and talk to them directly to them in your marketing material. This doesn’t mean that you won’t serve anyone else, only that the majority of your marketing activities is directed to a particular group of customers. This way you’ll avoid marketing messages that are bland and meaningless and which don’t appeal to anyone.
Once you’ve worked out who your customers are by collecting as much data as possible on them, become an expert at knowing their problems. Try to find out such things as:
By working out the answers to these questions you can get a deeper understanding of exactly how to talk to your target customers and use their own words to get their attention.
Creating in depth customer profiles can help you get a well rounded picture of your ideal customers. This means knowing not only their age, gender, location and spending habits but what they like to do, where they like to hang out, what media they consume and their general habits. While this may seem a little voyeuristic, the point is to make use of your limited marketing budget.
There is no point in buying ad space in a regional newspaper if your ideal customer primarily lives in cities. If your ideal customer is ‘new mothers’ then putting an ad or article on a site like essentialbaby.com.au is a great fit. By placing content or advertising where they are most likely to see it you will be able to better reach your target customers.
If you have a deep understanding of who your customers are, what they want and what their problems are then you’ll be able to be more targeted with your marketing spend. While you may have aspirations of growing your business into a multi-million dollar empire, that can come later once you’ve built up a loyal customer base.
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