Content Marketing Today

Don’t Start a Business or Launch a Product–Unless You Understand Your Customers

To succeed as an entrepreneur, you must embrace the core content marketing component of developing an in-depth understanding of your current or prospective customers. If you fail to achieve that understanding, your marketing strategy and ultimately your business stand a slim chance of success.

Over many years, I have interacted with or learned about a host of new startup ideas–or recently launched businesses.  I have usually feared for their survival.  Here’s why: most incipient entrepreneurs appeared to be operating almost entirely by gut feel.  Certainly hunches and instincts are critical components to entrepreneurial success.  In fact, those elements may differentiate entrepreneurs from many folks who were perfectly happy to work within more structured environments.

But gut feel is no substitute for doing basic homework on the viability of a business concept.  Of course, viability extends beyond an understanding of your prospective customers.  But, even an otherwise incredibly well-run business will tank unless that business understands the needs of its target buyers.

Here are 3 sketches of typical startup scenarios where a fundamental failure to understand future customers and their needs poses significant dangers to their ultimate survival:

• A veteran entrepreneur has a new idea that is related to an existing business.  This idea could possibly be big because it relates to the power of the Internet.  Because the entrepreneur is so excited about the idea, he makes the assumption that it is obviously viable.  Because his conviction is so strong, he does not see the need for fundamental due diligence and research that would validate the concept.   Enthusiasm is essential.  But it is insufficient for success absent a clear understanding of the need for a product or service among a very clearly defined target audience.
• Another entrepreneur has the germ of an idea that makes intuitive sense. Rather than take a structured approach to evaluating the merits and the credibility of the idea, the entrepreneur fleshed out the idea based on feedback from naturally supportive friends.  I’ve found that the one problem with friends is that they hesitate to tell you that your idea is not very good.  Over a period of months, a subsequent set of ideas bounced all over the place and no longer resemble that first germ.  In all that time, no real research has been done to test any of the evolving concepts. One of the most important questions ask was never asked: is there a genuine need for the product among a large enough group of future buyers to support an ongoing business?
• The final example comes from an article in our local newspaper which announced the imminent arrival of a new restaurant.  Although I cannot say with absolute certainty, it is pretty clear from the tenor of the article that the budding entrepreneur has little idea of the challenges ahead.  The entrepreneur is introducing a concept that is similar or identical to a dozen other local restaurants.  I happened to drive by the location of the soon to open eatery.  I was saddened but not surprised to see that it had been placed in an empty strip mall on a section of road that was unlikely to naturally attract diners. At the close of the article, it was pretty clear what had happened.  The optimistic restauranteur was quoted  as saying that they had always wanted to own a restaurant.  This long-term desire has almost certainly blinded the new restaurant owner to the upcoming challenges–and probably prevented them from doing the basic due diligence necessary to test the viability of launching yet another locally owned restaurant in an overly crowded category in a lightly traveled location.  The most important information to know would be: are there enough prospective diners would be inclined to drive by and make a stop at this relatively isolated restaurant? Simple observation suggests that the answer would have been no.

The often quoted statistic is that 80% of all small businesses fail within the first five years.  But, if you measured only those new businesses that had done all the homework necessary to test the viability of their ideas, we can all agree that the success ratio would have been dramatically higher.

Last year I was fortunate enough to do some volunteer work with SCORE which reinforced my conviction that too many folks start a business without any clear concept of whether it is likely to work.  Almost nobody showed up at SCORE with a business plan.  With only one or two exceptions, the hopeful entrepreneurs with whom I met had only the vaguest notion of how to turn a shapeless idea into a going concern.

This brings us right back to the beginning that fundamental component of content marketing: You must have a deep knowledge of your customers in order to provide them relevant content–and ultimately to provide them meaningful solutions.  If, as an entrepreneur, you lack this fundamental understanding, your likelihood of success is very slim indeed.