Now I will guide you through the development of the Customer Segments of your business model.
We usually think a lot about ways to get our customers to buy our products/services. In this chapter we will address this from a different angle. Our starting point will be: What can we provide for consumers so that they lead happier lives? With this mindset we will better understand who the potential customers could be. We can then better target them to maximize sales. Going forward we will call these customers our Target Customer.
As the founder of your business, you need to really understand who your Target Customers are, what you can offer them and how you can solve their problems.
Take a piece of paper and picture your ideal customer based on a set of factors: demographic (for example: age, gender, income, family life cycle), geographic (for example: location, urban/rural, weather conditions), psychographic (for example: personality, values, opinions, attitudes, interests, lifestyle).
Write down the needs of this customer, age and marital status and if s/he has children etc. This is now your customer’s Persona. The Persona will help you put yourself in your customers’ shoes.
In some cases, it might be quite straightforward to identify your target customer. For example, if you sell suitcases, your target customer may be someone who travels a lot. However, there are many different kinds of suitcases: of different quality and style that would fit different groups of travelers. Someone who travels for work may want a fancier high-quality type of suitcase, while a student going to school away from home may need a cheaper suitcase that can fold easily under the bed.
If you are selling mobile phones in a retail shop, your target customer could be a young man in his 20s willing to buy internet-supported phones so that he can access Facebook and go online to communicate with his classmates and friends. However, it could also be a woman farmer in her 30s who is looking to access the most up-to-date crop prices online, or do her online banking.
It is therefore important that you both identify your “persona” customer in line with the Value Proposition in your Business Model Canvas. Please pay attention to the fact that there are 3 main types of personas:
1. The person who will pay for the product/service: for example the parents of the student
2. The person who will use the product/service: for example, the student
3. The supporter: for example, a friend who influences the buyer on his or her choice of the final purchase of the product/service.
Take away: Now right down your persona or personas for your target customer.
Before you go ahead and finalize it, I would like to share with you how I went about identifying my target customer.
Esther’s target customer
Over the course of developing the different pumpkin products, I realized that I know how to produce pumpkin juice. But if my target customers don’t like pumpkin juice or do not really care for it, I will not be able to sell any.
So the first step I took was to better understand my customers. I knew I had to know concrete details about my target customers if I were to sell the right product to them.
So when I went to the market I talked to people to understand what they want, I also understood whom my ideal customer would be. I sat down and created a persona of the people who wanted to buy pumpkin juice.
My ideal customer is Elizabeth. She is 27 years old, married with 4 children. She works in a beauty store in town and earns 18,000 shillings a month. She likes to spend her free time with her family and friends and will enjoy my products with them.
Given that she has limited time and money she would spend her income on the basics and time saving needs, such as pumpkin juice or pumpkin slices, but not on pumpkin wine or raw whole pumpkins.
I learned that Elizabeth, as my target customer, would buy chopped pumpkins and pumpkin juice. However, she would not be interested in buying whole pumpkins or pumpkin wine.
Take away: Now write down the main characteristics of your target customer as I do. My target customer is 20-30 year old people with children, limited time and money. They need fresh as well as processed pumpkin products.
What is your Target customer? Get back to your piece of paper where you wrote down your ideas. Are they still the same? What has changed? Do you need to get back out and consult further?