Imagine you have a fantastic innovation and want to ensure it gets in the hands of customers. But who are those customers, and why should they buy the product from your company and not another? This is a difficult question, and one many companies with high-potential innovations struggle to answer.
Geoffrey Moore’s book Crossing the Chasm uses a means of developing profiles of your potential target customers to decipher which are the most attractive. It gives you the ability to focus your efforts on one type of customer rather than focusing too much on the early market, especially when there isn’t one for what you’re trying to sell.
The trouble is that to define your target customers, you need to have a good idea of who they are. And when you launch a new innovation, you might not have a lot of information to start with – so you have to take a best guess. The three-step process of developing target customer profiles helps you to develop a character in your mind of the kind of customer you most want to sell to.
Here is how to start:
1. Write out the “Header” information for your target customer:
a. For business to business markets, this includes industry, geography, size of organisation, number of users, department and similar information. For consumer markets, this includes mainly demographic information.
b. Describe the buyers in the target customer’s organisation. Usually there are three types, and it is possible for one person to have the role of one or all three: the economic buyer is the person who ultimately decides whether to buy your product or not; the end user is the person who uses the product or service and may provide guidance to the economic buyer when making the purchase decision;and the technical buyer is the person with specialised expertise relevant to your product within the customer’s organisation.
2. Next, scheme out a day in the target customer’s life . Start with the “before” version:
a. Scene or situation: focus on the moment of frustration. What is going on? What is the user about to attempt?
b. Desired outcome: what is the user trying to accomplish? Why is that important?
c. Attempted approach: without the new product, how does the user go about the task?
d. Interfering factors: what goes wrong? How and why does it go wrong?
e. Economic consequences: what is the impact of the user failing to accomplish the task productively?
Let’s take customer relationship management (CRM) software tools as an example. The buyer may be frustrated with how leads are managed. The sales team may be talking to a lot of leads but not managing their time. Many contacts that are developed get lost along the way, and if someone from the sales team leaves the organisation, then the contact leaves with them. There must be a better way.
Their desired outcome may be to have greater visibility on what the sales team is doing and have some of their KPIs measured. How many leads are they talking to? How many meetings are they having per week? What can we do to improve their productivity and effectiveness?
The company may have attempted to get the sales team to put all their leads on an Excel sheet and manage them manually. While this does help to quantify things, it is a frustratingly long and tedious process.
The extra time it takes for management to “manage” leads on the Excel sheet diverts their attention from managing sales. No other new initiatives are put in place, and sales stagnate. They may have slightly more visibility on what the sales team is doing, but sales definitely haven’t improved.
3. Now, scheme out a day in the target customer’s life – the after version:
a. New approach: with the new product how does the end user go about the task?
b. Enabling factors: what is it about the new approach that allows the user to become productive?
c. Economic rewards: what are the costs avoided or benefits gained?
In conclusion, building a library of say a dozen or so target customer profiles will help to supply the data on which initial decisions can be made as to their attractiveness. Once you know which are the most attractive and accessible, you’ll have your target.
Ahmed Al Akber is the managing director of ACK Solutions, a firm that helps companies improve their marketing and sales results