The $100 MBA

One of the most important steps in building a successful business is figuring out to whom it caters. In fact, it should be one of the first things you decide when you venture into the world of entrepreneurship. Your own passion and expertise should guide the creation of your product, but the difference between a hobby and a business is that they do so with a market of consumers in mind. That’s why it’s so important to carefully define your target audience.

In doing so, you’ll want to be specific. Simply targeting “teenagers” or “pet owners” or “hipsters” is only the start. You’ll want to narrow the field to appeal to a distinct archetype, a kind of customer that you can serve better than anyone else. While narrowing the target audience may seem counter-intuitive (Appeal to less people, you say?), it’s actually the case that the most successful small businesses make their money by offering a specific solution to a specific need. “Teenagers with a heavy course load at school,” “pet owners who live in apartments,” or “hipsters with particularly unruly beards” are all target markets that can be served way more effectively, with the right product.

Even if you’re not in the early phase of building an independent business, it’s never too late to define your audience. In fact, it’s necessary to revisit the question over and over, periodically sharpening the image of your customer- especially as your business grows and innovates its products. By consistently keeping your target audience in mind, you’ll be sure to tailor your products in the ways that best ensure customer satisfaction. In that sense, defining your audience is the most important aspect of designing your product. To do so, use these tried-and-true strategies:

Be Specific. Very specific, about what it is your product offers. Whatever makes your product uniquely valuable, whatever sets it apart from the competition, will help you define exactly who you’re selling it to. Selling shoes isn’t specific enough to define an audience. Even selling athletic shoes isn’t specific enough. Even selling basketball shoes still falls short of the kind of specificity needed to pinpoint your target market.

To continue with the shoe example, a sufficiently specific product would be a basketball shoe with added ankle support to avoid sprains. By zeroing in on the most particular aspects of your product, you define who it’s made for. The thin-ankled, regular sufferers of an injury common to one sport, is a narrow but important demographic, one that your company could have all to it itself by focusing on its needs. No, it’s not a “big tent” strategy designed to convince the broader market to buy your shoe, but the aim here is brand loyalty, not mass appeal. That’s the key to small business: the loyalty of smaller markets.

Focus on one person. Literally. A single customer, real or hypothetical, who best represents your targeted market. This may sound like an extremely specific strategy, but it works when you apply what you learn to the demographic as a whole. In business jargon, companies refer to an “avatar.” If you tailor your product to your avatar, it will be popular among everyone who shares his or her key preferences. Your avatar is a stand-in for the hundreds, thousands, or millions of people you hope to target, but through him or her, you target them in a more personalized way.

Have a headline and three bullet points. Come up with a headline that encapsulates what your product is offering to your specific audience. This forces you to really articulate not just what your product is, but who it’s for. Then, come up with three short selling points that would further entice this targeted audience. Think of it as an exercise in marksmanship- by coming up with this headline and these bullet points, you’re forcing yourself to think in terms of what would make a particular audience respond. You’re aiming for the precise needs that you’re in the business of fulfilling.

Here’s how this would look in our sneaker example:

Constantly playing on a sore ankle? Introducing FlexForce:

• Scientifically proven to reduce the risk of sprain
• No more annoying braces
• Play with confidence and without fear of injury

It looks like an ad, and it could be. But the point of the exercise is to cultivate the mindset of identifying the customer, and getting inside their heads to meet their needs.

Build long-term relationships. Once you think you know who your audience is, refine your understanding of their needs by getting to know them as intimately as possible. When you seek them out, envision yourself serving them not for a single sale, but for years on end. This is a relationship, not a fling, and the companies with the most loyal following are the companies that do everything they can to keep a running conversation with their audience.

At Business Republic, for example, we’ve put a great deal of effort into our freecontent- the blogs and podcasts for both the $100 MBA and our software company, Webinar Ninja. The reason we expend so much time and capital on things that don’t make us a dime? Relationship-building. We offer value, and in return we get the opportunity to serve an audience that knows us as well as we know them.

It’s a reciprocal relationship built on familiarity, credibility and trust. Two years into the $100 MBA and a year into Webinar Ninja, we like to think that our audience is well-defined, and that we can meet its needs in ways that other companies wouldn’t think to.

Defining and targeting a specific audience can seem like it’s limiting. Intuition tells us that every product should have as broad an appeal as possible, right? But in the world of small business and independent entrepreneurship, success is built on a guerrilla strategy, taking on precisely defined targets rather than huge swaths of the consumer world. Defining your audience isn’t casting a smaller net- it’s simply choosing to cast it exactly where the fish are.