Welcome to the Why businesses fail series. This is the third of five blogs that delve into the reasons for businesses failing and offering solutions. This series was launched by Lucy Robinson of Birkbeck Futures and Ghazala Zia from Windsor Swan. In this blog, they share how you can narrow down your customer and find an effective marketing strategy to attract and retain them.
Lucy Robinson is the Employability Consultant for Business and Enterprise at Birkbeck Futures. She runs the Pioneer programme for aspiring and early-stage entrepreneurs and hosts an enterprise series on the #FuturesPodcast.
Ghazala Zia is a Venture Capital Advisor at Windsor Swan, a boutique London business advisory firm. She has an extensive legal background, and currently specialises in advising start-ups of all stages on funding, strategy and business analysis.
Once the product or service has been tested, it’s not enough to assume that it will speak for itself. Customers don’t come without being invited. It’s crucial to have a detailed customer acquisition strategy and a relevant, targeted marketing strategy alongside in order to succeed.
Firstly, define your customer. Not just ‘young women’ or ‘professional millennials’, but very specifically identified. Think about gender, age group, location, profession, and more. Similarly, your customer might not be an individual but a service provider themselves. You still need to be specific here. For example, if you want to sell to a university, who do you want to reach within the organisation? The students, the lectures, the staff? Knowing who your customers actually are is vital to the short- and long-term success of your start-up. Conducting market research tests on your intended audience is also a great way to measure if they actually want your product – often, you may be surprised by who your actual customers are.
At the early stages of a start-up, it’s wise to channel funds (even if they’re limited) into a solid marketing strategy. Test your consumer behaviour, determine advertising costs, and determine how many customers you’ll reach. Similarly, build up your brand reputation in order to garner recognition and ultimately, loyalty from your intended audience.
Customers show loyalty to authenticity, and your marketing should reflect a strong and consistent brand identity that is honest to the product itself. If you have a flashy marketing campaign but the product itself doesn’t hold up to scrutiny, you risk being slated online and by word of mouth. This is why the marketing strategy itself only holds up when the product does – which bring us back to the importance of understanding the problem you’re solving, and carrying out extensive testing on your intended audience.
Within your customer acquisition strategy, you should be familiar with certain metrics. How will you acquire your customers? What is your cost of acquisition? How much marketing do you need to spend to acquire one customer? How are you going to retain that customer?
Read about how to identify a need in the market and attract investors in the first two blogs of the series.
