Every day is precious in the run-up to the launch of a new hyperlocal platform. Startups that waste time and valuable resources targeting potential customers who fall outside their ideal archetype are putting themselves at a disadvantage. Defining the ideal customer should be one of the first steps a startup takes during its earliest days, since the needs of that ideal customer will play a major role in the features and tools included in a particular hyperlocal platform.
Here are five ways that early-stage hyperlocal startups can go about defining their ideal customers.
1. Visit trade shows and conferences. “We go to a fair number of trade shows, like the Expo East and Expo West Natural Product shows, where we can talk with dozens of current and potential customers in a short period of time. I also make a point of listening to what our frontline salespeople are hearing from the customers they talk to, and we have all-company meetings where they share with each other.” (Nik Blosser, Chinook Book)
2. Start with a plentiful market. “Numbers never lie. When we started Social Sonar, we began signing up sole proprietors. We soon discovered that even $150/month was a stretch for most small business owners. Eventually we realized larger businesses would better understand the value. It was obvious to make the customer switch once we crunched our data. It may not be as clear for some companies, but data is a great place to start. If you’re consistently not hitting your goals, it’s time to adjust things.” (Alison Kawa, Social Sonar)
3. Don’t get too tailored. “We serve the small business community in English-speaking countries — potentially millions of customers. This forces us to think high-level. If we try to get too specific in defining the ideal customer (like what city, what food, or how many years they’ve been in business) then we inevitably overlook a major segment of business that we didn’t imagine.” (Jim Williams, MustHaveMenus)
4. Stay close to current customers. “Whenever I’m unsure which path to take, I make a point to go talk face-to-face with current customers. This helps me understand what value we are delivering to them with our current products, and if they perceive the value the same way we do. I can use this knowledge to determine what other customers or customer groups are most likely to find the same kind of value from what we do.” (Nik Blosser, Chinook Book)
5. Be the original customer. “Most startups are created to solve a particular problem the founders have identified in the marketplace. From the beginning, we felt that we should target the SMB channel, but out of ambition we wanted to be as opportunistic as possible. Since then, we’ve decided to focus on SMBs, which has allowed us to tailor our products to their needs, sharpen our messaging, and improve our sales process. I recommend targeting the type of customer you’re familiar with because you’ve been there, whether as an individual, an SMB, or an employee in a large corporation.” (Ayal Ebert, Dispop)
Interviews have been edited for length and clarity.
Stephanie Miles is an associate editor at Street Fight.