One of the things I like to probe business owners about starts with the following statement, “Tell me your target audience and I’ll tell you about your business” because it generates some interesting replies.
In the majority of cases the reply goes something like this “Well, we work with accountants, lawyers, builders, schools, mechanics etc, etc”. It largely boils down to the fact that they will work with anyone who might pay them. In short there are simply too many targets, which means, there is no target. It means they are spraying their precious resources in multiple directions, typically in a hap-hazard way with poor results.
These style of responses indicate that the business in question lacks focus. You would think that the first thing that any business should get straight is who their target customers are. Don’t believe me? Next time you see a tradie van on the streets, take a look at what it actually says. Ones I have seen recently include “Commercial and domestic cleaners” and “Cleaners and exterminators”. If you have a think about both of these, they are pretty divergent in their target markets aren’t they? How can a business honestly say that they can do both of these tasks well? They are saying that they are both the same aren’t they which I sure the customers of either demographic would strongly disagree with. How can they say that they have invested in ensuring that they do those tasks better than anyone else on the market? They haven’t. They are broadening their aim in the hope of hitting revenue. Hope is not a strategy.
As the saying goes, “if you plan to be everything to everyone, then you are nothing to no one”. In short, you are a commodity and a commodity is not something a smaller business wants to be. Being divergent with your target market is something your customers soon being to learn about your business. They learn that you are not focused on their needs, you have divided attention, little real desire to go deep with the business needs. You largely see them as a source of revenue and the desire to maintain only a shallow relationship with That then gets returned in kind as customers screw their suppliers for every dollar they can and look to take every advantage of whatever is on offer. Soon the whole relationship becomes about ‘what’s in it for me’ from both sides.
A target should be exactly that, something you aim for. It should be something you can show easily. The target is never the outer ring of a dart board now is it? The bit most people are trying to hit on the dart board is the really small bit in the center! A defined target allows you to judge how close you are to your goal. Of course, you have to define your own unique bull’s eye first. So, if your target market is accountants and you come across an opportunity that involves lawyers, you now have an idea how far away from your target that is. Just because it isn’t your precise target doesn’t mean you shouldn’t consider the opportunity. However, having a target allows you to more easily evaluate how much additional work and effort maybe required and the diversion from your current focus it will demand. This allows you to make much more informed and pragmatic business decisions about that opportunity. Will it really generate the profit to justify its distance from the bull’s eye? Unfortunately, most don’t have a defined target and make decisions based purely on perceived revenue, which generally never turns out to be.
We have all experienced companies that are very focused on their customers and others that aren’t. This fact is most evident to me in restaurants. Some have very attentive and helpful wait staff that return regularly to see if there is anything further they can do. Others have staff that is next to impossible to get attention from, have their backs turned to you so they can’t see you and so on. I return to the places that provide me good service and are attentive to my needs and tell others NOT to go to other places AS WELL AS never returning there! Double whammy!
You can’t provide good customer service without knowing your customer intimately. This means a focus on understanding what their needs are so they can be serviced. Yes, this requires and investment of time. Yes, this requires an ongoing discipline to remain focused. It is far easier to maintain focus with a system. The system doesn’t have to be complicated. Define a target and then measure the opportunities from this target. Make decisions based on that not random acceptance of what you come across. That rarely results in business synergy.
Start your discovery of the importance of having a very focused target market by asking your peers or other businesses who they consider their target markets to be. Listen closely and you’ll soon discover what their business is really likely to be based on who they focus on. The broader the focus the less effort has been invested in finding the right customers. Then, take that learnings into your own business and don’t make the same mistake that most businesses make in believing that revenue is the same as profit. It ain’t!