Marketing Strategy Tip Number Two: Know Your Customer
Minute 2: Know Your Customer
How well do you know your customers? How well do you understand what they think of your products or services? How do you know if your products or services meet their needs? Is your business too inward looking to understand what your customers want?
All valid questions, and crucial to understand if your business is to grow successfully and not waste investment on developing product or service features that have limited value. Or waste valuable marketing budget on promoting these unappealing product and service features to a disinterested audience.
The Customer Value Grid is a simple tool which can help your business map what your customers most value about your product and services currently and any new features you have in the pipeline. This version is used by the team at Ashridge Business School.
How to use the Customer Value Grid
This is an interactive tool so you need either a pad of paper or flipchart or, ideally, a blank wall plus pens and post-it notes.
You can use the Customer Value Grid to analyse existing products and services, which is always a useful exercise, or assess new products and services.
In either scenario, start with what you know about your customers now and map the product and service features in the boxes above.
Get your teams across the business to participate. (It goes without saying that you should also seek input from your customers, and ideally through face-to-face feedback rather than online surveys.)
Here’s my worked for a mobile banking app:
How does this exercise help you build a market strategy?
You’ve already ‘sized the prize’ of your opportunity in Minute 1 with TAM SAM and SOM. The Customer Value Grid overlays customer-centric thinking to this market opportunity and helps frame your thinking for your options for growth (Minute 3: How Will Your Business Grow).
For example, if you are looking to sell more to existing customers, will a new product or service feature that you know customers value create an upsell opportunity? Will a new service feature, such as sign-in with Facebook in our mobile banking example, secure new users who then do not a) call a contact centre or b) go into a branch, if they can find one, and so save you costs?
Unless you truly understand what your customers want and value, your business is in danger of investing unwisely and marketing poorly.