After 10 years as a Business Consultant, I have realized that almost everyone gets the same thing wrong about understanding customers.
1️⃣ Data focused on products, not customers.
🛍️ In an electronics store, the most frequently purchased product is AA batteries. But it does not mean that customers are loyal to the store primarily because of the battery prices.
Check yourself 🔎: Do you know how many clients purchased your product in the past year?
2️⃣ Missing top clients.
🍻 In a craft beer company, average customers have 1 small purchase a year. But the top clients, interested in new limited editions, have 2x bigger orders and 4x higher frequency.
Check yourself 🔎: Do you know who are your best customers?
3️⃣ Assuming based on personal thoughts or experience.
🛍️ If a person comes to a physical shopping mall, he or she does not need a delivery service. Wrong! A customer from the Middle East asks for delivery straight to the private jet (!) while visiting a European city.
Check yourself 🔎: Do you have a definition of key buyer personas?
4️⃣ Assuming without talking.
🛒 The best clients in an e-shop order 6x more products than the average customer and 20x more than a one-timer. Deep talks revealed that these best clients have the potential to double their consumption.
Check yourself 🔎: Have you ever talked with your customers?
P.S. Research agencies don't count as they lack a connection with your business. You don't need a 100-slide presentation. You need to hear 1 insight out of a couple of talks that will change your perception of customers.
5️⃣ Missing out on the end user.
🎁 A luxury company was focusing only on purchasers, overlooking the importance of catering to the end-users (gift receivers) and those who influence the purchaser.
💻 A SaaS company was focused solely on developing features for users, neglecting the crucial needs of managers who required reporting functionalities.
Check yourself 🔎: Who are your end users?
6️⃣ Missing the real motivation.
🕯️ Woman’s that buy expensive candles want to collect all candles of the same colour, they pretend that most of the purchases are gifts as they are afraid to reveal to they husband the truth about spending.
🏢 Women go to the drugstore not just to buy household items, but because they're tired after work and want to relax before going home.
Check yourself 🔎: What motivates your customers? What do they want to Achieve or what are they Afraid of?
A useful tool could be blogs and articles. For example, type in "Start-up founder fears" on Google. You will find, that one of the most common fears is the fear of running out of money:
- "I am scared we won't get another round of funding."
- "I am afraid our money will run out because of poor sales."
That's why I help founders build a revenue stream and sleep in peace. 😴💰
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