by Eric Armstrong
Understanding your target market is the heart of a smart startup strategy. Your target customers’ needs will define everything from your branding to your product development process. Yet getting to know your potential customers isn’t always as linear as you expect. Many entrepreneurs develop customer profiles, or avatars, solely on demographic information: How old are your customers, how much do they make, and where do they live?
This is valuable information, but if you dig deeper, you can gather real insights that will change the way you do business. Asking the right questions will help you determine what super-entrepreneur Marc Andreessen called “product-market fit.” Product-market fit is that nexus where your product offerings perfectly serve an urgent need in your target market. Here are our top questions for diving deep into minds of your target audience and identifying real opportunities for your startup.
1. What are the psychographics of my market?
The psychographics are the details that go beyond the basic demographics and show how your potential customers live. Psychographics also give you insight into what really matters to them, how they use products, and what language and marketing approaches are most likely to resonate.
Aspects of psychographics include lifestyle, values, beliefs, attitudes, and activities. This is where you learn that your 30 year old female New Yorker with a $100,000 per year salary goes to yoga every day, shops at Whole Foods, and believes that her health is her top priority. With psychographic details, it’s possible to develop products and craft copy that resonates on a deep level with your customers.
2. What’s the core pain that they’re experiencing?
What’s the biggest problem or pain point that’s affecting your potential customers? You have a true product-market fit when your product is the solution to your market’s most urgent problem. Expert marketers say that there are four niches: health/fitness, self-development, dating, and financial/career.
You’ll note these tend to correspond to our everyone’s biggest concerns. It’s important to develop a deep and nuanced understanding of what’s truly important to your customers. How do they describe the problem you’re trying to solve? What language do they use? What impact does it have on their lives? How would their lives improve if the problem was solved?
3. Where does my target market spend time and consume their information?
What brands are trusted resources in your customers’ minds? What websites, social networks, email lists, and boards do they participate in? This information is valuable for two reasons. Some of the deepest insights you can gain into their needs and experiences will come from observing the informal discussions that they have online. It will also help you generate relevant content and other materials by honing in on the appropriate topics and language. What questions are they asking? What issues come up again and again? If you look at traditional media, what are they consistently using to sell subscriptions?
4. What benefits resonate with them the most (or solve their most painful problems?)
Every product is a set of features. For example, a software product might have a feature such as an internal instant messaging system. But the potential benefits that extend from that are varied: the potential for increased collaboration with a team, the ability to simplify your desktop and eliminate external messaging programs, or the introduction of real-time communication to project management.
Knowing which benefits are most important to your target market are important both in terms of how you frame your message, as well as where you focus your development energies.
5. What’s my competitive landscape?
Every product exists somewhere in an ecosystem of related choices and options. When you’re purchasing a car, you’re often considering multiple makes or models. Even if you’re committed to a specific brand, there are multiple models with different levels of luxury and technology.
Determining where your product or service fits into the competitive landscape is crucial. As marketers and entrepreneurs, we often don’t know the full scope of the choices that our clients face. It’s important for them to weigh in directly on what brands and products they consider your competitors. Ideally, you want to do this as an unaided study where you see what names come to mind. You can then hone in on specific brands that they mention or that you’ve identified, to understand their perceptions and positive and negative associations with each brand.
Investing the time to really understand your target market when you’re developing new products or launching a company can save countless hours and thousands of dollars down the line. Don’t be afraid to ask tough questions and dig deep. This will make all the difference between a wildly successful company and a failure. What other questions do you use to help determine the specifics of your target market? Let us know in the comments below.
Eric Armstrong is a marketing professional specializing in qualitative market research. When he’s not writing, you can find Eric teaching martial arts classes at his local community center.