Know Thy Customer!

Of the many, many, many questions entrepreneurs must ask themselves, one of the most critical is “Who is my customer?”  Without understanding who your customer is, you cannot begin to perform other important tasks such as market research, building a value chain, conducting user experience studies, buyer behavior analysis, cost of acquisition information, etc.  Heck – if you haven’t determined who your customer really is – why are you even getting into business?

So…who is your customer?

A formal definition is provided below:

A customer is usually used to refer to a current or potential buyer or user of the products of an individual or organization, called the supplier, seller, or vendor. This is typically through purchasing or renting goods or services. However, in certain contexts, the term customer also includes by extension any entity that uses or experiences the services of another.  A customer may also be a viewer of the product or service that is being sold despite deciding not to buy them.

Let’s extrapolate a bit further by answering a couple of questions:

1)  You develop a new software for children, who is the customer?  Children or Parents?

2)  You sell I.T. services into an organization, who is the customer?  Purchasing Department or I.T. Manager?

Let’s examine this – based upon the definition above, be clear on the distinction in these two questions.  In question #1, the Parent is the customer because they are not only making the decision to buy (for their kids) but are also paying for the product.  In question #2, the I.T. manager is making the decision to buy and the purchasing department is just processing the paperwork to ensure the order is placed.

Understanding the nuances more clearly now, I want you to ask yourself – who is my customer?  Is it the person making the decision to buy?  Is it person paying the money?  The answer – it depends.  It could be one or the other, or, it could be both.  That’s up to you to decipher.

Regardless of the answer, the lesson is here is to make sure you are implicitly clear on who your real customer is.  Once you figure that out, ensure that your efforts are tailored on the right target and constantly question your assumptions.

To your continued success…

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2 Comments

    1. That’s a great case – every time you “pivot” you have to think about the implications including, who is now your new customer. Thanks for the comment Justin!

      Reply

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