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Unit 3: Identifying what your users or customers need
Identifying what your users or customers need
Well done! You have chosen challenges to solve in the world and in your community. But do you know what your community thinks? Remember, these are the people who will buy your product or use your service. You really need a shared understanding of the real issues!
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Your brilliant idea won’t help if no-one wants to use it or can’t buy it! One of the key elements of a successful business is the market (CUSTOMERS) or if you are a social entrepreneur, is this good match or fit to your community and environment.
1 Basic elements of a business
z Product – a thing you can make or something you can do (a service) that solves a specific problem and gives users what they need and want. z Market – a group of people who need and want your product or service, and someone is willing to pay for it (customers or funders). z Money – to get the business started, and to keep business going. z People – employees who have the necessary knowledge and skills, and are motivated to make the business work.
Basic elements of a business
Product Market
Money People
Food for thought *These days, it is not necessary to limit your business to your immediate physical area. The internet and social media make it possible to reach customers across the world. All you need is a website and a way to transport your products to your customers (airlines, couriers and post offices). For example, www.tenstickers.co.za may have a South African website address, but the products are often manufactured in European countries such as Belgium and then shipped from Spain! Go global in your business!
So how do you find out what your potential customers want? How can you make your customers very happy?
Doing market research simply means finding out (‘researching’) who your market (‘customers’) is, and what products or services they need and want.
There are many different ways to do market research, like z Watch people: observing or watching customers or potential users in their daily lives, or while they are using a product or service; z Talk to people (focus groups): small groups of people, who are asked specific questions in order to gather information about their views on various issues; z Write your questions out − for developing questionnaires for written feedback or written interview questions.
All of these methods could be carried out either in person, or online (using whatsapp, e-mail or the internet).
IMPORTANT! NEVER interfere with people’s privacy while doing market research!
Market research should answer three basic questions: z Who is my USER? z Is my product or service idea in DEMAND (needed)? z How much are people WILLING TO PAY for my product? If not themselves, who can pay for this to be used by others?
Types of questions to ask to get the right information Your questions should include:
Basic information to get a general picture of who your potential customers are (the ‘target market’): z Age/Grade z Where they work, live or go to school z Gender (if important) z Occupation/income
Now, keeping in mind the product or service you want to put on the market, start asking questions about the interests and behaviour of your target market: z Would you like to …? z Would you use … ? z How often would you use …. ? z Do you prefer X or Z …? z How much would you be prepared to pay for …?
(Remember, make sure these questions relate to your planned product or service!)
The next stage is to find out what your target market is already using (in other words, are there products or services that compete with your planned product or service?) z What product or service do you currently use to …. z How long have you been using it? z What do you like about this product or service? z What don’t you like about this product or service? z What would you change about this product or service?
Now are you ready to present your new idea for a product or service. You can use a short written description, or show a fun video. Make sure that you highlight the most important parts of your offering. Keep it simple, but interesting and always true. Talk about what makes your product or service unique, and remind the users what changes you expect in their life if they use your product or service.
You can then ask specific questions to find out if people will buy or use your product or service, such as: At what price would you consider buying this product/service?
Good questions for better understanding
z Ask open-ended questions − (not yes/no questions) Open-ended questions get people talking, focusing the conversation on what is most important to the customer.
For example, asking “Tell me about the last time you purchased a gift for someone special” (open-ended) is a better question than “Have you ever bought a gift?” (yes/no) z Encourage stories − Stories show how people think and feel about the world, give clues about behaviour, and give you a chance to ask follow-up questions. Get customers talking, then listen carefully and with curiosity! z Ask why, why, why − Find out why people do or say things, what they were hoping to accomplish, and why those things are important in their life. Ask deeper questions to make sure you get to the root of the issue.
Also see: How to Conduct a Market Research Survey for Your Startup Idea, https:// medium.com/startup-grind/how-to-conduct-a-market-research-survey-for-your-product-idead048dc080259
My Market Research table:
Interviews
Focus groups
Questionnaires
Observation Benefits Challenges
For your product or service, what is the best way of doing market research: online market research, or personal, face-to-face market research?
Why?
Also see: The Importance of Market Research For New Business Ideas https://www.entrepreneur.com/article/217345
Useful sites: https://www.thesmallbusinesssite.co.za/starting-a-business/
Remember, earlier we also mentioned that observation (watching people) is a good way of doing market research.
To observe someone is to look at or study someone; in this case to find out what they actually do, what they use, what they buy, and if they could be a potential user of what you make.
Here is a very interesting way of doing observational market research: garbology!
TEACHING TIPS | Bags of Rubbish
ACTIVITY 3.2
Garbology
Fill in the details based on what your best guess is, based on the information you get from looking through your customer’s garbage. There is no right or wrong answer.
SOCIOECONOMIC
Income Level:
Education Level:
Work/Occupation:
GEOGRAPHIC
Where do they live? Be very specific!
Age: Gender:
Race:
Language at home: Generation:
PSYCHOGRAPHICS
Buying Behaviour (from what they throw away)
Family Size/Details
Interests or Hobbies
Attributes Relating To Geography: Lifestyle: Life stage: Personality: Attitudes:
Values/Beliefs:
Source: https://yeacademy.org/lessons/?topic=marketing&lesson=garbology&resource=2227
OTHER INFORMATION ABOUT YOUR CUSTOMER
TEACHING TIPS | Games people play
Summary At the beginning of the digital age, a maker of electronic systems asked a team of engineers to develop digital games. The engineers saw an opportunity to convert Checkers, Chess, and other old board games into electronic versions. Consumer research showed a much bigger opportunity, a fantasy world beyond the imaginations of the engineers.
Strategic Issues The new technological breakthroughs in integrated circuits, microprocessors and other electronic components made new products possible. A big company organized engineering teams to work on a different opportunity. One team was assigned “games” and the task of developing games for digital devices and media. The team’s first focus was on converting various board games into digital or electronic versions, and they wanted some guidance, based on consumer research, about how best to design electronic versions of these board games. But the engineers might be too rigid or too structured in their thinking, and recommended that qualitative research (focus groups and depth interviews) be the research method. They asked about consumer motivations (why they played the games) and the engineers could view the interviews and understand better what might be possible. The engineers liked the idea of escaping their desks to watch consumers through a one-way mirror, and the project was approved.
Research Objectives The researchers wanted to help the engineers convert board games into electronic versions, based on consumer feedback. We explored consumer attitudes toward games in general – and asked what the game players liked and disliked about the games. The makers felt it was a waste of time, but agreed to ask the users.
Research Design and Methods They used focus groups and depth interviews. Face to face focus groups were conducted in the United States, across many major cities. Several focus groups among men, divided into similar age groups, were conducted. Several focus groups were conducted among women, following the same sampling pattern. In addition, a number of depth interviews happened in each market. The researchers wanted to see the users as they discussed games (in groups), but the researchers also wanted to hear what individuals would say and do without peer influence or pressure (why they needed, the depth interviews).
The questions they asked, started very broadly and vaguely on the subject of playing games and sports, so that respondents did not know the purpose of the discussions. As the sessions evolved, researchers asked about childhood memories of playing games, explored adults playing games with other adults, and explored adults playing games with children. The research asked questions about the joys of games and the disappointments. They used role playing and story telling, to help uncover deeper emotions and feelings. The research probed into the psychology of game playing and the factors involved. Towards the end of the sessions, focus was on board games and their conversion to electronic media (the primary objective).
The groups loved this, were very involved and it showed new revelations that were deep. It seemed that everyone had very strong feelings about games and game playing. The longer respondents talked, the deeper and more intense the sessions became. The results were not what the engineers expected.
Results We learned that human beings are extremely competitive creatures, but these competitive urges are suppressed at every turn. In the home, in school, in church, and at work, open competition among individuals is actively discouraged in the interests of social harmony and cooperation. In playing games, these deep-seated competitive drives are unleashed and set free. It’s thrilling to compete openly to win – when winning is a socially acceptable outcome.
We also learned that consumers were not much interested in playing board games, or solving puzzles, or playing chess on computers or electronic media. What the participants really wanted to do was sit in the cockpit and fly the airplane, sit in the driver’s seat and race the car, drive the tank and shoot its gun, and carry the rifle and grenades into the thick of battle. The respondents wanted simulated action and conflict, and wanted to be participants in the competitive action and excitement. We were thrilled with these discoveries. They started a new industry. The rest is history.
Winning Ideas
ACTIVITY 3.3
Take one of the ideas (possible solutions) you came up with in the previous unit (Activity/worksheet 2.5), and design a questionnaire that you can use in a market survey to identify in detail z Who are your users/target market?; z Is there a demand for your product or service?, and z What needs to change from your first idea so that customers get what they need and also what they want?
