The importance of identifying and understanding customers
For a new business, it is very important to identify who its customers or potential customers are and understand what they want. Identifying, understanding and meeting the requirements of customers means a new business can do two key things: generate sales and make its more likely.
Generating sales
Generating sales is much easier when a business has a clear idea of its customers and what they want. This enables the business to provide a product or service that directly meets customers’ requirements. For example, a business may decide that its target audience is customers who are on non-meat diets. As a result, it would only source vegan or vegetarian-certified items and food. Because this strategy would be based on an understanding of what its customers want, it would be likely to generate a lot of sales. However, if this same business tried to sell items derived from animals, such as leather jackets or ham sandwiches, it wouldn’t be understanding the requirements of its customers. As a result, it wouldn’t generate sales.
Business survival
Survival is one of the main aims of a new, small business and usually relates to the business continuing to operate for at least 12 months. By generating sales through understanding the requirements of potential customers, a business has a much greater chance of survival. One thing that is key to business survival is keeping up with the changing requirements of customers. Businesses must adapt their products and services to suit these changing requirements.
