One of the biggest mistakes small business owners make (some big business owners as well) is that they don’t know their target customer segment well enough, or if they do they insist on trying to target a much broader group. Have you properly asked yourself "Who is my ideal customer?"
Why? Because we hate to say no to potential business and often think that we can do more than we should.
We get excited about how big the potential market place is and therefore how big our business can be. The reality is that for most small businesses, there will be a small amount of the market that ‘gets’ the value from your business and are willing to purchase you over the competitive offers / choices.
Often when I ask small business owners to describe their market or ‘where they will play’ they say things like;
- People between 25 and 60
- All Sydney businesses
- People who drink coffee
All of these are massive marketplaces and way to big for a medium to large business let alone a small business. In fact they are almost paralysing they are so big – where do you start when you think your market is this big?
The broad you go, the weaker your message will be. The weaker the message the harder it will be to attract customers to convert.
Unfortunately this often comes down to discipline – you as the owner need to pick a market and stick to it which means saying no to other markets you know you can’t service as well.
You can’t say no until you have first said yes.
So what is important here is that you know the small segment that ‘get’ the value from your offering, and that small segment is big enough for you to build your business around. Plus they should also be growing and not declining and have the money to buy you.
If not then you and your business will struggle. However know you market, chase it, build for it, service it and you will have a very successful business.
Struggling to pick your target customer segment? Then answer this question –
"If I could have 100 clients magically appear today but they must all look the same, what or who would they look like?"
This is your target customer.