Building Customer Profile: Who is your customer?
As a founder, I’m sure you have spent almost 98% of your time either thinking about this question or answering this question in investor meetings. And yet it is one of the most difficult questions to have a response for.
In fact, most startups have a great idea and build magical solutions but just don’t know who their user is?
In the last few years, I have tried to find an answer to this question myself. I have tried to break this down to basically this chart:
Users or customers can be found on various channels. But the first step is to define them. As Donna Griffit, corporate storyteller, says:
The person that has so much on their plate that they can’t handle it all. At least not well. And you have a solution or service that can make their load lighter and their life better. Now they just need to see you from behind the pile of gook on their plate, and that’s your challenge.
But most times, ideas come from a personal problem that a founder could not find a solution for. If you create the right solution, it may end up serving a huge market. As Heather Anderson of The Club and The Mamahood says:
A long-time serial entrepreneur, community builder and mom of five, I was struggling for a while to find my niche. After some introspection, I realized my ideal customer was basically me. I love connecting with inspiring, uplifting women doing awesome community-centered work and found it hard to find all those women in one place. I wanted to fit more fun, joy, and adventure back into my busy life so that I could truly ‘have it all’. I realized there had to be more women out there like me. Women who had huge dreams and aspirations, and who feel inspired and invigorated by community – so I created something I was truly longing for myself and came up with The Club. The Club is now one year old and brings joy, fun, community and connection to womxn entrepeneurs whose businesses serve The Bay Area.
You may find it surprising that many founders have a HUGE market and a great product but are still struggling with finding out the uniqueness of their product or service. My friend Lauren Marie Taylor of Zero Gravity, who helps startups figure this out shares one of her client stories where:
The founder didn’t realize that her app replaces an $85K subscription with her $12K subscription. The app pays for itself in the first two months when you consider the savings from dropping the other product. IT SELLS ITSELF.
Lauren takes the founders through this 5 step journey to figure out the customers:
- Who has the problem I’m trying to solve?
- Knows that they have the problem.
- Has been trying to solve it some other way.
- Paying an amount equivalent to what I’m charging (in time/money, etc.)
- And lastly, are unhappy with their current solution.
But the very first step is to find your early adopters. These are the people who are ready to use your product because it solves their most dire need. They are ok with MVPs, clunky builds as long as it makes their life easier.
As Maria Malavenda of Evvemi says:
Your customer is the person who is smart enough to know they need help. They’re the first ones to look for new ways to remove the barriers to the path to their success. The true first movers who adopt new processes or new technologies have similar persona characteristics aka a deep desire and need to accomplish or use something.
Now, what happens when you’re going beyond your early adopters. You have to take into account who are the different types of people or profiles who will use your product or service. Any successful product that exists in the market today has a variety of users. Take Instagram for example. They have at least these 2 basic customer profiles:
- Users, who want to share their stories and life with their closed ones.
- Businesses, who want to sell their product to the other users.
As Jaime Kornick of Undercover Insights says:
Understand what problem the product or service is solving. Then reverse-engineering the customer into it to ensure alignment. Now, dive into personas to identify the distinctions between the customers – as not all customers are the same. I believe customers shouldn’t be treated as one group, instead, they should be acknowledged by the differences between the costumers to address the various priorities, perceptions, unmet needs, etc
As a founder, you have to be in constant experimentation mode and remember, intuition and data are a potent mix to find your users. If you find an interesting insight, put it to test and see the numbers. Once you see your CAC (Customer Acquisition Cost) going lower. Go all in!
With time, you find that perfect persona and get the traction you need.
As Sydney James of Stay Polished says:
Stay Polished is a concierge beauty service but it was never about lipstick and blush. I saw women out there giving to their communities, working on their passions, and unfortunately, they themselves were falling to the wayside. They were becoming tired and burnt out. I also knew how powerful it is when women invested in themselves and felt and looked good. We determined our ideal customer by who we wanted to empower to fiercely follow their passion. Our ideal customer is driven and community-focused whether it is a nonprofit founder, school crossing guard, or tech founder. We activate confidence in our clients so they can go and make the world a better place.
Lastly, I want to leave you with this quick checklist. Take your time with it. These are the questions investors will ask in meetings. Make sure you are prepared. And if you are a bootstrapped startup, then these points will be your best friends in leading to a sound revenue.
Hope this helps!
PS: I have been able to create a pipeline of 40,000 users just using these metrics. But that story for another time.
Cheers,
Arjita
