To learn about potential customers you must conduct market research. Remember, you must know who your potential customers are and what type of product or service they are looking for in terms of a solution to their problem/s. Find your market first, than customize your service or product to fill the market need. Do not develop your service or product first, and attempt to find a market for it afterwards – This is a recipe for disaster.
If you’re selling to industries or other businesses, answer the following questions:
1. List your major customers, their location, number of employees and the main product or services they sell.
2. Who makes the purchasing decision in the companies you’re targeting?
3. What are the key criteria in making the buying decisions?
4. What price would they be willing to pay for your services?
5. What are the specific needs of the users of your product or services?
If you’re selling to consumers, answer the following questions:
1. Where do potential clients live?
2. What is their age? level of education? annual income?
3. How many people make up the average household?
4. What are their current buying habits?
5. How do they use their leisure time?
6. Do they have specific needs or wants that aren’t being fulfilled?
7. What do they like and not like about the products or services of your potential competitors?
8. Where is the best place to locate a business?
9. What distance are typical customers willing to travel to buy from you?
Determine the number of potential customers
How many of the potential customers you described previously live within your local geographical area? State the source of this information.
Determine the number of potential customers that will purchase from you
You need to seriously consider your competition, both in numbers and in quality. (You will address these issues in a coming section). You also need to realize that some potential customers will not purchase the product or service from you or a competitor.
|1. Estimate number of potential clients in your market area|
|2. % of clients that will purchase products or services from your business|
|3. Your Total Potential Customers (Multiply #1 x #2)|
For example, lets say in year 1, you estimate the number of potential clients in your area to be 20,000. You also assume, based on your research that roughly 20% will purchase your product. Your total potential customer reach is 4,000 customers (20,000 x .20 = 4,000).
Other: If items 1, 2, and 3 above do not apply, describe your total potential customers.