If you're a restaurant, is your product food? If so why not open a grocery store or strictly deliver. You need to understand what your product truly is.
If you don't know your product then how do you know what to sell. It sounds basic but many businesses aren't clear on the product they are selling. They may know that they are selling and they may be selling decently, but if you don't know what it is you’re selling how can you market it and target it to your customers?
I know you’re thinking, “Well, of course I know what my product is. It is X.” Some of you are right but for others it is actually W.
We were recently talking to a new real estate investment company. Their goal is to buy rental buildings with the help of investors of either time or money. Ultimately they need to have renters. Can you guess what their product is?
At first blush the product is their buildings. They need to attract renters with the product of their building. Initially their target was renters. On the flip side they still need investors. Afterall, they are the ones investing in the building. We saw a discrepancy.
You should only have one target audience. In their case it's either renters or investors. Choose your target and work backwards if this is your situation.
Let's work out what their product is. They make money from renters for themselves and their investors. They need to essentially sell the prospect of income from renters to their investors to buy into. This lateral shift means their product is actually renters and rental income.
Yes, they need to make sure they have an ample supply of renters and will need to attract them one way or another but ultimately they need buy in from investors. Renters are basically stock just like books are in a book store.
The only way the business works is if they sell the investment opportunity of renters. Investors don’t actually even care what building it is as long as it makes them money.
If the building is the product, their goal would be to just find the nicest, newest building they could find. There are no guarantees that building would reach capacity of renters, though.
With this clarity they can re-strategize their entire marketing plan. They know the product and their target. Now their goal is to reach their target customers with messaging that promotes their product. They can focus on finding buildings that have the highest potential of renters and rental income.
Think of it this way. When you go to the movie theater what are you buying—truly? What is the product they offer you every time you go? You're just going for a movie right?
Can't you watch a movie at home, on a tablet, or your phone? It's not the days of film noir when the novelty of a movie itself was enough. You can literally consume a movie from anywhere at any time these days but you've chosen the theatre and not Netflix.
You've chosen the theatre. The theatre offers big sound, a big screen, and a crowd. They've sold you a night out. It's more than just a movie because they've made it an event. It’s something you can’t get at home.
So what is their product if it's not a ticket stub, cushy seat, or the movie itself? It's an experience. With this clarity Cineplex knows it is not enough to target people who just want to watch movies. They know their customers like to go out and they know these same people enjoy laughing and crying with others at a show.
Maybe that’s not you. You might go to a movie for a very different reason. That’s the beauty of a target market. You will get business from people outside your target market too. Choosing a target does not restrict you. It guides a business and focusses it so consumers know what they are buying.
Knowing your product means knowing your customers. It's a great first step in figuring out what your logo design will be and what you hope your brand stands for. You need to know who you are talking to and what you are talking to them about.
The best way to do that is to ask yourself questions. Follow the money trail backwards. Distill down what your product is. If you have any sense of ambiguity, keep going. Come up with the one line you tell your Mom when you're explaining your business:
I sell X to customers that are Y.
If you need help with questions, a great place to start is our Discovery Questionnaire where we’ve outlined our first round of questions we ask our potential clients for logo design. Don’t feel any obligation to hit submit, we just hope you can use the answers to these as a guide.
You can also hit us up on Twitter @brandcouver and we’d be happy to help!