Businesses that have learnt how to succeed with a market focused strategy are far more likely to survive and thrive.
Unfortunately, far too many small businesses adopt a product focused strategy and fail to understand the market(s) being served. Market Research is considered a distraction rather than the guiding light. And this is a key reason why so many businesses fail early…
If you want more evidence of the ‘passing of the product focused’ watch ‘Dragon’s Den’. Note how many ‘failed’ presenters know their product inside out but their market knowledge is guesswork – at best.
Rules of the road
Market research was always part of Hitchhiking. If you observe, note and understand the ‘rules of the road’ you travel much further. As a rule of ‘thumbing’, once I was in a vehicle I would typically start an early conversation by seeking to understand why drivers chose to offer me a lift. And that’s the best question in market research: “Why?”
The question ‘why?’ naturally seeks deeper reasoning and thinking. Asked in the right tone, the respondent is invited to provide valuable detail. And the resulting information allows you to learn about and ultimately make subtle but absolutely critical changes to aspects of your product/service. Basic market research (what? when? how? etc.) will highlight other important issues such as demand levels. However, answers to the ‘why; question allows you to shape what you offer so that customers get just what they want.
Find out what people want & provide it
Hitchhiking taught me quickly that a large rucksack spoke volumes to passing drivers. A rucksack, I was told, was non threatening; it suggested I was travelling with a purpose. People also warmed to the idea that they were helping someone who they believed had been living in the great outdoors. If behavioural understanding really interests, I recommend you look at semiotics. This fascinating subject is a fast developing field of study.
People also advised as to where I should stand on the roadside. It was important to them that they had time to see me, make a judgement and pull over with relative safety. My appearance was also an issue to (I was never scruffy nor overdressed). People were divided over whether I should be using a sign or just my thumb.
Market focused strategy – Fortune favours the brave (and wise)
Observing peoples’ behaviour and using research to modify my roadside ‘offer’ never stopped. For example, a journey that started in Fort William and ended in York demonstrates how to succeed with a market focused strategy.
Covering the 350+ miles in a single day was not going to be easy, but to give myself the best possible chance I needed to adopt a market focused strategy. Research showed there was no ‘driver-friendly’ place to hitch from (on the road out of Fort William) and so I arranged for a friend to drive me a few miles into Glen Coe. I was dropped off at a roadside lay-by with a great view back down the famous valley.
There was little traffic in the Glen that day. But my view and the clarity of the air meant I saw every vehicle long before I heard it. After 25 minutes only 3 vehicles had passed. Then a wagon became appeared in the distance and slowly lumbered up the valley. Stood at the end of the lay-by I put my thumb out just as I made out the driver in the cab. At the last minute, the air brakes went on. I was in luck.
Better still, when I climbed the cab stairs and opened the door to tell him I was headed to York, his smile widened. With a friendly Yorkshire accent, he let me know it was my lucky day. He was passing the city on the way to Doncaster! Full of enthusiasm I got in and it wasn’t long before I asked him the ‘why?’ question. He told me that he liked to pick up hitchhikers for the company, but if I had been stood anywhere else in the Glen he probably wouldn’t have seen me or been able to stop safely. My day could have been completely different.
And these and many other questions were asked every time I hitched.
To succeed with a market focused strategy, appropriate questions and market research should be a continuous exercise with potential and existing customers. And like my travels, you don’t have to devise formal questionnaires or organise expensive focus groups. So much gold-dust can be extracted by asking critical but simple questions of the right people at the right time.
But knowing the market is one thing; you must know your competitors too.
Key Learning Points: Succeed with a market focused strategy by creating products or services that are demand led. Use the ‘why’ question to really understand what motivates your customers and drives them to make decisions that affect your business.