Your products need to be matched to your customers. There is little call for gas heaters in the tropics, consequently it will be difficult to find a retail outlet selling gas heaters in Bali, likewise, jumpers and long johns will be slow sellers. It can be a thin line between bringing an innovative new and totally different product to market and it succeeding or falling flat. Sometimes a product or service may fail, not because it is an inferior product but because it was unable to get a foothold into the market, or just didn’t suite the market. It may however work elsewhere, and it may be a run-away success. Making the determination of a products success or not is your job, and in today’s world, it just got harder.
Demographic product matching is especially crucial for bricks and mortar stores, and specifically those stores that retail goods and services that might be a commodity by nature. Think food.
You either love food or you purchase it to survive. Either way we all need it. For a retailer this is a good thing. Problem is that there are lots of retailers trying to sell to the same market. With so much immediate choice, most shoppers will head to their local shops rather than travel great distances – this is a problem for retailers (as with all generalised statements, there are exceptions to the rule).
If you have an absolutely must get to market product, then you need to do some homework to ensure that your most immediate customer base will buy it.
There are a couple of strategies that you can use to test the market, including small scale roll-out, free samples, brand ambassadors and feedback loops.
You could persist if your initial results are inconclusive, but what do you do if the results are absolutely abysmal; do you withdraw the product and go back to scratch or do you look for alternative outlets?
The point here is that you need to know what your customers want or are likely to want. Certainly, if you customer base is receptive to new ideas or products and services, then your market testing will probably be more successful. If however your consumer base is closed and will not deviate from their established buying habits, then persisting with a product or service outside your customer comfort zone may be an expensive exercise.
Appropriate marketing may help to break new products and services into established markets, and there have been numerous success stories. Correspondingly there have also been some failures. Where there has been success, the rewards have been great.
This article is not about stifling innovation or holding back on pushing the envelope; sometimes the market needs to be tested. The take home point here is to ensure that you have done your homework and made an informed decision. The use of samplers and other give-aways is a smart way of doing things. Using an “All In” investing strategy in a bizarre product without appropriate background work is dangerous.
So far we have assumed that your customer base is static and restrictive. Although it is important to work to your current customer purchasing habits, there may be some serious advantages to expanding your current customer base. If what you do is tied into geographic areas, then this might be a little bit difficult.
A great example is tradesmen that establish geographic business names. Fantastic calling yourself Aubin Grove Plumbing – you may be at the top of the list of all Aubin Grove residents if they need a plumber. But the further away from Aubin Grove a potential customer is, the less likely that they will call the business. A localised name will tell everyone that you are not interested in servicing clients outside a 5km radius. Now don’t get me wrong, maybe this is all that you want, in which case this is fine, but if you wanted to expand, then maybe a more generic name might be more appropriate – say something like Southside Plumbing Services (SPS).
If you are tied to a physical location and customers need to visit you (such as a shop), then expending your base may become a tad more difficult. The trick here is to setup a system where your product is traded outside of the constraints of a physical location. Agents, online, wholesaling, etc. are all possible and will be strategies that are individually explored in future blogs.