Business plan quiz 1
how do i find out about served available market?
talk to potential customers
made to stick 6 principles?
SUCCESS: S: simple U: unexpected C: concrete C: credible E: emotional S: stories
Target market
your target customers are those most likely to buy from you. who will likely be your first customers?
underlying principles
humility: you probably don't know the customer very well respect: the customer's needs are more important than your product, design, technology empathy: you need to know their pain before you can ease it
total available market
the total market demand for a product
SAM
-How many people need/can use this product, rather than others? have the money to buy? -how large would that market be in $ if they all bought? -how many units would that be?
necessary characteristics
-definable: they have something in common -meaningful: relates to decision to buy -sizable: big enough to sustain a business-but not too big -reachable: you can access them
segmentation options
-demographics: age, income, gender -geographic: location -psychographic: related to self-image (interests, opinions, values) -buying sensitivities: what matters most? (price, quality, brand name, convenience, etc) to segment?
TAM
-how many people would want/need this type of product? -how large would the market be in $ if they all bought? -how many unit would that be?
customer archetype/start with one market segment
-more convincing -faster feedback from specific customers -within a target market, different customers have different tastes-less noise in feedback -need to know their pain -can you provide benefit to them?
what influences customers?
-nature of buying: intermediate user vs end user or both, seasonality, durability (repurchase) -external market influences: regulations, norms, legitiamcy -temporal: long run and short run
target market TM
-who am I going to sell to in year 1, 2 & 3? -how many customers is that? -how large is the market in $ if they all bought? -how many units would that be?
what does the audience need be convinced of?
1. that there are customers with a similar need (market need) 2. that customers WILL buy your solution to that need because: -you know what the customers want -they will prefer your solution to competitor's -you will be able to sell to them
how can you show that you really know your target market?
PRIMARY DATA: -prior sales -commitments to buy -committed relationships -own personal expertise -feedback from potential customers-first you look-then customers test
served available market
is the segment of the TAM targeted by your products and services which are within your reach
how do i find out about TAM?
library databases
how do i find out about my target market?
talk to potential customers identify and talk to channel partners (A channel partner is a company that partners with a manufacturer or producer to market and sell the manufacturer's products, services, or technologies. This is usually done through a co-branding relationship. Channel partners may be distributors, vendors, retailers, consultants, systems integrators (SI), technology deployment consultancies, and value-added resellers (VARs) and other such organizations.) -identify and talk to competitors
customer archetype
the idea is used to convert dry demographic descriptions of customers into living, breathing people the audience can understand. Archetypes are 1-person samples (real or fictitious) of the typical customer
what is the goal of a market analysis?
to convince the audience (investors)
how do we know our target market?
understand your customers really well
