On Target
Step 2: Decide if You Have a Market
Before you commit hours to researching what customers want from you, it makes sense to find out whether you have a viable target market. The cheapest and simplest way to do this is through "secondary data," or information someone else has already gathered for you. Usually, this takes the form of various statistics and can only answer closed-ended questions: How many? When? Where? Your own questions will depend on your customer profile and become more tightly targeted based on what you find out as you go. You can find answers in a number of ways: Content Continues Below
1. Reference librarians: Most are delighted to help you research. Often, they'll practically do it for you. These days, they can look up a lot of what you need on computer databases, and you have a decent chance of walking away with all your answers. Printouts may cost several cents per page. 2. The local field office of the Department of Commerce: It should supply you with free or nearly free information on population, demographics, housing, the economy, market trends, surveys of current businesses, and more. 3. The business libraries of local universities: These often have more specific information on business trends than a public library. Ask the librarian for help. 4. Your local SBA branch or Small Business Development Center: It has a multitude of publications and business literature full of advice and market forecasts. Once you've got all the answers, it's time for a judgment call: Do you have a working market? Only you can decide if 14 competitors are too many for 19,000 target customers, or if you want to gamble on the fact that your target customer spent 30 percent more last year than three years ago. If you don't like the numbers, at least you've just saved yourself a potential financial disaster. Now you're armed with a much better grasp of market conditions to revamp your business idea or marketing direction and return to Step 1. Portrait of a Customer Before your research is over, your ideas about your target customer may change several times. Add explanations and qualifiers under each category as they occur to you; these will document your thought processes and remind you of how you got to the final concept.
This is a preliminary customer profile for an entrepreneur's actual business idea. He wanted to offer faux paint effects, but wasn't sure if there was enough of a market in his area for him to do this for a living. Going only on his own knowledge, this is the customer profile we came up with (comments, qualifiers and all):
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What makes a good client gift?
What guidelines do you follow when buying gifts for your clients? Have you ever received an unusual or inappropriate gift?
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