The document discusses the importance of understanding customers for business success, covering how to identify target markets through demographic, psychographic, behavioral, and geographic segmentation. It emphasizes the significance of meeting customer requirements and estimating market size using Total Addressable Market (TAM), Serviceable Available Market (SAM), and Serviceable Obtainable Market (SOM). Ultimately, it highlights the need for ongoing research and adaptation to align business strategies with customer needs.

1. The Customer Compass: Navigating Target Market,
Requirements, and Size

2. Welcome to the
Customer Compass
● Understanding your customers is key to
business success.
● We'll explore how to identify your target
market, understand customer
requirements, and estimate market size.
● Think about a product you love. Who do
you think is its target market?

3. Defining the Target
Market
● A target market is a specific group of
consumers most likely to want your
product or service.
● Segmentation can be based on
demographics, psychographics, behavior,
or geography.
● Why is it important to have a well-defined
target market?

4. Demographic Segmentation
● Demographics include age, gender, income, education, and
family status.
● Products often appeal to customers in certain demographic
brackets.
● How might a product for teenagers differ from one for adults?

5. Psychographic
Segmentation
● Psychographics cover lifestyle,
personality traits, values, and interests.
● This helps predict how customers make
purchasing decisions.
● Can you think of a product that appeals to
a specific lifestyle?

6. Behavioral
Segmentation
● Behavioral factors include purchasing
behavior, user status, and brand
interactions.
● It helps in understanding customer habits
and preferences.
● What are some buying habits you've
noticed among your peers?

7. Geographic Segmentation
● Geographic location, climate, and whether an area is urban or
rural can influence consumer needs.
● Products may be tailored to fit these geographic specifics.
● Why would a company market differently in a city versus a rural
area?

8. Identifying Customer
Requirements
● Customer requirements are the specific
features and qualities that consumers
seek.
● These can be identified through surveys,
feedback, and market research.
● What's a feature you look for in your
favorite products?

9. Importance of Meeting
Customer Needs
● Meeting customer needs leads to
satisfaction, loyalty, and repeat business.
● It also helps in differentiating your product
from competitors.
● How does a brand gain your loyalty?

10. Market Size Estimation
● Market size is the total potential sales for a product or service.
● It's measured by volume (units) or value (revenue).
● Why is it important for a business to estimate its market size?

11. Calculating Total
Addressable Market (TAM)
● TAM is the total market demand for a
product or service.
● It helps in understanding the growth
potential and setting realistic sales
targets.
● How might a company use TAM to plan its
future?

12. Serviceable Available
Market (SAM)
● SAM is the segment of TAM targeted by
your products and reachable within your
distribution channels.
● It's more focused than TAM and directly
applicable to your business.
● How does SAM differ from TAM in
practical terms?

13. Serviceable Obtainable Market (SOM)
● SOM is the portion of SAM that you can capture.
● It's influenced by competition, brand strength, and market
penetration strategies.
● What factors might affect a company's ability to increase its
SOM?

14. Market Research
Techniques
● Techniques include surveys, interviews,
focus groups, and data analysis.
● Research helps in understanding
customer behavior and market trends.
● What's a market research method you've
participated in?

15. Competitive Analysis
● Analyzing competitors helps in identifying
market gaps and opportunities.
● Tools like SWOT analysis can be used to
assess strengths, weaknesses,
opportunities, and threats.
● Can you name a competitor of your
favorite brand?

16. Customer Personas
● Personas are fictional characters representing different user
types within a target market.
● They help in visualizing the ideal customer and tailoring
marketing strategies.
● Imagine a persona for a new gaming app. What would they be
like?

17. Value Proposition
● A value proposition clearly explains how a
product solves customers' problems or
improves their situation.
● It communicates the specific benefits of
your product.
● What value does your favorite product
offer to you?

18. Product Positioning
● Positioning is how a product is perceived
in the context of competitive alternatives.
● It involves creating a unique impression in
the customer's mind.
● How is your favorite brand positioned
against its competitors?

19. Marketing Mix (The 4 Ps)
● The 4 Ps are Product, Price, Place, and Promotion.
● They are used to consider different facets of marketing a product.
● How might the 4 Ps influence your decision to buy something?

20. Adjusting to Market
Changes
● Markets evolve due to technology,
consumer preferences, and economic
factors.
● Businesses must adapt their target market
strategies accordingly.
● What's a recent market change you've
noticed, and how have businesses
adapted?

21. Conclusion: Aligning with
the Customer
● Aligning with your customer is about
understanding and meeting their needs.
● It requires ongoing research, adaptation,
and strategic planning.
● How will you apply these concepts to
better understand customer needs in the
future?