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MARKETS, NEED-FINDING AND PLANNING

DEFINING THE FOCAL MARKET: MARKET SEGMENTATION

Three questions:
 Why segment?
o Helps you prioritize
o Helps you manage your resources
o Helps you identify the focal market
o Helps you become better than your competitors
 Starting with change management. Unclear if market will pay
 Starting with LBSAA. Segment into different customers with
pain points. Unclear what the value proposition is that will
meet their needs
 Ultimate goal:
o Describe the segment in terms of a typical
customer/buyer.
 3Ws:
 Who buys?
 What product do they buy today?
 Why would they switch today and tomorrow?
 To look at:
 Demographics – gender, age
 Behaviors – routine, usage patterns
 Needs – pain points
o Describe the size, potential value and growth of the
segment: To compare segments, look at size (total
population), growth (perceived adoption rate) and
profitability (based on customer’s income)
o Deliver services to the segment. How actionable – can I
serve them?

UNDERSTANDING USER NEEDS

4 steps of needs identification
 Gather raw data on customer needs:
o Focus groups with 8 – 10 customers: Highly productive
but expensive
o Interviews: Cheap, effective and fast
 Interview all stakeholders – users, buyers, advisors
 5 – 20 subjects. Sweet spot is 10
o Surveys: Good for specific companies like pricing and
product features but less useful in opportunity
identification
 Interpret the data
 Organize the needs by type
 Establish relative importance of their needs

Establish relative importance of their needs b) Describe the size. Ask about current behavior rather than speculating about the future 4. 5 – 20 subjects. Ask for specific examples rather than generalizations 5. Why would they switch today and tomorrow? Needs – pain points. Interview all stakeholders – users. Size (total population) b. Forget the product concept and focus on user need 3. advisors b. 2. How actionable – can I serve them? . Start with LBSAA. effective and fast a. What product do they buy today? Behaviors – routine. Will the user value the product? Is change management a pain point? TO DO: 1. Identify the steps in the customer journey or experience ii. Accessibility. But it increases the odds of success. Gather raw data on customer needs: 1. potential value and growth of the segment: To compare segments. i. usage patterns c. Interviews: Cheap. Clarify what the value proposition is that will meet their needs Ultimate goal: a) Describe the segment in terms of a typical customer/buyer.CAVEAT: Facebook and Google didn’t do it. 3Ws: a. Segment into different customers with pain points. Sweet spot is 10 2. Growth (perceived adoption rate) c. Organize the needs by type iv. Profitability (based on customer’s income) c) Deliver services to the segment. Who buys? Demographics – gender. buyers. age b. look at: a. Interpret the data iii.