How do entrepreneurial business owners balance the passion they have for their product and the demands of the consumer? Savvy, successful enterprises manage to achieve equilibrium. Many small businesses fail because they cannot strike this balance.
I live in a small town with a tourism-based economy. Summer is the busiest season in spite of our proximity to a ski area. We have very long shoulder seasons. During March and April many local businesses wonder how they will survive. I’ve seen a lot of business come and go—for lack of vision, lack of funding, lack of planning, lack of customers.
Lack of customers is an illusion. It is blaming the customer for the failure of the business to do its homework. There are things we need in this small town. Things the residents would like to have access to, but do not. Perhaps we didn’t really need a truck accessories store or an artisan jewelry boutique or a flower shop. With a limited population it is difficult to support the overhead that many retail businesses require. Or perhaps, these businesses didn’t do enough.
I am actively involved in a local contemporary arts center. For two years we have launched exhibitions, sold artwork, sponsored workshops and lectures and done some very active market research—learning what people like and don’t like, defining our audience, attracting like-minded associates. It’s research that has required tens of thousands of dollars. Today, we know what the numbers look like. We have a clear idea of what we can do to make money and what endeavors we undertake that are loss-leaders and what are incredibly valuable and meaningful events for the community, but do not make money that will require sponsorship and grant funding. We have shifted our priorities to focus on the money-making enterprise that will fund the valuable community endeavors.
Which is what a small business owners must do, as well. Shanan Campbell Wells started her Sorrel Sky gallery thinking that she would provide Western art, fill a niche that she saw was missing in the Durango art scene. Today, four years later, her gallery has morphed into a balance of art she likes, artists she enjoys working with and what her customers will buy.
It comes down to market research.
Market research can be as simple as collecting zip codes from customers, asking them to fill out a comment card or as complex as purchasing $4,500 research studies on the world buyers of costume jewelry.
The website http://www.knowthis.com provides access to some of the free market research that is out there. Want to know about bloggers? Home furniture and appliance trends? Gourmet food statistics? Then check out their website for this handy information.
Locally, try your county’s office of economic development, your town’s chamber of commerce and the local library for access to information on the demographics of the community in which you operate a business. Talking to other business owners is key. How long have they been in business? What is the most difficult thing they’ve dealt with as a business owner? What do they know about their customers? The cycles?
Most small business owners have defined their business; the product or service they offer, how they differ from the competition; and how they will promote and distribute their product or service.
What they don’t spend as much time on is defining their customers. Are they men or women? How old? How much money do they make? Where do they live? What patterns or habits do they have? What do they read? Where do they shop? What do they listen to? What do they watch? What do they value about your product or service? And what can you do to keep those existing customers happy? And how do you reach those people? Where do you find them?
Once a business knows this, they can develop a proactive plan to reach out to those people. If I want to open a jewelry boutique in a small town that doesn’t have a large enough population to support the cost of doing business, then I can access a broader client base by selling my jewelry on Ebay, through a website or in catalogs that do reach my prospective client.
Knowing my customer and how best to reach them is the key to a successful enterprise.