The following questions will help you to truly understand your customers, their needs, and your competition – otherwise known as marketing intelligence. Knowing your market inside out is fundamentally important to creating profitable products and services.
This post is the first of three that make up the Geeksy small business marketing system; and is also available as a downloadable template, ready to complete for your business:
Marketing intelligence is an on-going process, and the amount of research you will have to do will be dependent on your experience in your particular market – if you’re new to your market then you’re going to need put in a fair amount of time to truly understand it.
Please note we use the term products in the general sense to describe both products and services, or a mixture of both.
The aim of customer profiling is to understand exactly who your customers are, so that you can begin to understand their needs.
- Do you sell to businesses or to individuals? One of the most important distinctions to make in marketing is whether you sell to businesses or whether you sell to individuals. Selling to businesses is often called business-to-business (B2B), while selling to individuals is known as business-to-consumer (B2C). This distinction will have a massive impact on which techniques will be most effective in promoting your products.
- Are your customers based locally, regionally, nationally or even internationally? This may be limited by your ability to deliver to a certain geographic region, or may be a choice made by you. It’s often sensible for a small business to think local, even if in principle, they can reach customers much further afield.
- If you sell to businesses, what sector do they tend to be in? Are they small, medium or large businesses? The process of attracting new customers will be considerably different depending on the size of organisation you are targeting. Describe what size of business you aim for and if you deal with customers mainly in certain sectors, then note that down as well.
- If you sell to individuals, how wealthy do they tend to be? What stage in life are they at? Provide as much detail as you can about your consumers. The more detail that you have about your consumers the better. Their income and overall wealth is important, as well as the stage they are at in life. Do they have a family, or if not, do they intend to start one? Maybe their family has left the nest or your consumers are children themselves. Do your consumers actually make the purchase or is it made on their behalf – if so, by whom?
- What things do your customers tend to read? What do they watch? What do they listen to? What influences your customers? Where do they draw their inspiration? These questions may seem obscure, but the more you know about the media that your customers consume, the more chance you can use that media to reach out to them. If you don’t have the answers then try asking some of your existing customers.
Customer Needs Analysis
Once you know who your customers are, you can work out what they need, and most importantly, why this is the case.
- What needs do your customers have that you serve? Understanding the needs of your customers is fundamentally important to effective marketing. What need are your customers responding to by purchasing your products? List all the needs you can think of.
- Why do your customers have these needs? For each need that you’ve identified, what are the different reasons that customers have that need? The aim is to put your customers into groups that have similar motivations for a particular need. Grouping your customers in this way is known as market segmentation by needs and it’s a powerful technique.
It’s the why that really matters. As an example, of those businesses that need a website, some may need one because they’ve never had one before and want a simple online brochure. Whereas some may need one because they want to sell products online – these two customers are going to have considerably different requirements.
Choose the needs that you have identified one-by-one and list all the possible reasons why customers might have each need.
Customer Buying Behaviour
You need to understand when, where, and how your customers buy products and services like yours. That’s so you know when, where and how to pitch your offering!
- Where do your customers buy products like yours? Do your customers buy in shops, in person, on the phone or online? Do customers travel to see their supplier or does the supplier come to them? Is buying locally important to your customers? Would they rather buy your product from abroad? Describe where customers buy products like yours.
- When do your customers buy products like yours? Do customers tend to buy at certain points in the year such as: around budget time or at Christmas? Is it a purchase made at a certain point in life or business growth? Are there any particular triggers that inspire customers to make a purchase or do they buy completely on impulse? Describe when customers buy products like yours.
- How do your customers buy products like yours? How do customers actually make the purchase? Do they make one-off purchases or repeat orders. Do they pay by cash, standing order, or on credit terms? Describe how customers buy products like yours.
- What are the ‘deal breakers’ for customers buying products like yours? What would really turn them off? Are there certain levels of product or service that are expected by customers?
- What are the major changes that are happening in the way that your customers buy? Markets very rarely stand still, what are the major trends in your market that are affecting how customers buy and make their buying decisions? These are often called the market drivers; describe these factors for your market.
You can learn a lot about your market by researching your competition. You can do this by visiting their websites, speaking to their customers or even by becoming a customer yourself. Just don’t expect them to be too helpful if they find out you’re the competition!
- What is your competition doing right? This could be their products, their branding, or anything else that you think would be particularly attractive to customers.
- What is your competition doing wrong? These are the things that you should really avoid – if you’re doing them now then you must stop!
- Have your competition had any good ideas that might influence your product ideas? These ideas may influence the development of your own offering. As long as you don’t infringe any intellectual property, steal with glee!
- Who are the most expensive competitors in your market? Who are the cheapest? What’s the difference between their offerings? Customers tend to expect certain levels of product or service at different price points. What are the main price points in your market – from the highest to the lowest and those in between? What do your competitors offer at these different prices? This known as the shape of the market, describe the shape of your market.
If you would like to download this post as a template ready to complete for your business, you can do so here:
Marketing Intelligence Template
Alternatively, you can move on to marketing planning element of the Geeksy small business marketing system.