If you build it will they really come?
Defining who will buy your product is the key to success.
It can be really exciting to have a new product idea, especially when you make the decision to bring it to market. New entrepreneurs often “test market” their new product on friends and family, and if everyone loves it, it gets even more exciting! However, one cannot assume that as a result of this limited testing that “everyone” will want to buy it. Honing in on who will buy your product is really important to long term success. This is called target marketing.
Target marketing is also about understanding who your customers are, so that you can effectively reach out and start building a rapport with them, as well as design a marketing plan to reach them. The everything-but-the-kitchen-sink marketing plan usually ends in disappointment. A target market may be defined in terms of age, gender, sexual orientation, economic class, ethnicity, religion, or location.
According to the Missouri Business Development Program, “Most entrepreneurs believe that market research and analysis is something only marketing professionals and statisticians can do. This is not the case. Marketing research is simply an orderly, objective way of learning about your potential customers and your competition.”
You can use email, phone, or in-person customer surveys. You don’t necessarily need large numbers of participants to learn more about your customer base—you might be surprised how much you’ll take away from just 5-10 good conversations. If you’re worried about being able to recruit survey participants, you can offer a free gift to motivate participation.
Here are some important questions to answer in defining your market:
Who needs your product or service? Is there a specific age, gender, family size, educational level and/or occupation that will be drawn to what you have to offer? What are their interests or hobbies?
Where will you find them? Can they be found by zip code or at certain other types of businesses? What else is significant about the geography - the size of the area, its population density, and its climate?
Why do your customers buy your (or your competitor’s) product? What do they do for a living? How much money do they make? This personality and lifestyle information will help you determine buying patterns, like how much and how often they need to buy it. This information may also help you figure out key advantages that you can provide over your competitors!
What media does your target market use, and what message will you use to reach that target market?
The key is to collect information, and then compare it to the assumptions you’ve made about your customers. What’s surprising? What strikes you as an untapped opportunity? Did you hear the same or similar complaints/suggestions from multiple people?
Target marketing is going to require some upfront work, but the rewards are huge, and well worth the effort.
The MSU Product Center, in partnership with Michigan State University Extension, provides business counseling for product development, packaging and marketing strategies that will help Michigan entrepreneurs commercialize high-value, consumer–responsive food, value-added agriculture, and natural resource products. For more information, visit the MSU Product Center website or call 517-432-8750.