Product-Customer Fit: curate your Ideal Customer Profile for who really need your product
Sample Product-Customer Fit:
Imagine you are launching a product that helps other companies with the problem of frequent team meetings. Wouldn’t it be better to chase companies that have offices in more than one location and use Zoom for meetings, instead of chasing all SaaS companies in the hope of finding the best one? If your email open rate is lower than 50% or you are receiving negative replies, it is probable that you are not reaching out to the wrong leads. It is not viable to use resources and time to draw the attention of companies that might never buy your product because they either do not need your product or do not match your Ideal Customer Profile (ICP).
A Product-Customer Fit study is often crucial to increase the growth rate and ROI of a product for both a start-up and a well-established company. One needs to filter out certain prospects in order to reach the ones which would be seriously interested in their company’s product or service. The audience you are looking for is a group of people with similar needs and certain behaviors. The table below shows examples of companies that would reach out to prospects before and after completing the product-audience fit process.
There are a number of ways to refine your audience before you directly contact them. Here is a short (but handy) list of factors that can be used to define your audience.
Finding Intent: How are your potential customers behaving? This implies actions such as visiting web pages, searching keywords, online reading, etc. It also includes their main pain points: things that they are complaining about. Basically, gathering intent data about your prospects reflects what they are looking for and if they are ready to purchase the product you are offering.
For further reading about Intent Data, please click here to get a succinct blog piece.
Your Competitors' Customers: Your competitors would be offering a product similar to yours, therefore, their customers can also be a good fit for your business. It is always a good idea to reach out to them and show them how you stand apart from your competition in the market.
People Using the Same Integrations and Complementary Products: If your product is integrated with tools such as Salesforce and HubSpot, there is a higher chance that companies using these tools for their business will buy your product as well. Similarly, it is also a good idea to find complementary products that add value when they are used in unison with your product. For instance, your product is for the companies that have to stay available 24/7, you can check this domain and find a product for a similar purpose. The next step is to find the existing customers of the product and chase them.
Your Existing Customers' Competitors: It is most likely for you to find prospects in companies that are your existing customers’ competitors, as they would have similar needs. If you are selling to Company A, then the competitors of the said Company A would also show interest in your product as you are probably solving a problem that all such companies are facing.
The research and the work that goes into finding the right Product-Audience Fit pays off with a number of benefits including;
Higher number of closed deals
Faster Sales Cycle
Finding the language and channel to reach your customers
Getting more while spending less
What do all these ‘fits’ mean?
Product-Market Fit is usually described as a scenario when a company is successful in ensuring that its customers are buying, using, and advocating the company’s product(s) in significant numbers that can help sustain the company’s growth and bring in revenue. Marc Anderson, an entrepreneur and investor, is often cited for coining the term ‘product-market fit’, which he explains as the phenomenon of finding a good market for a product that can satisfy the needs of the said market.
It is understandable that one needs to employ a product-market fit strategy for the success of a business. However, the question remains, “How to do so?”. It would be a good idea to divide this major term into sub-categories in order to understand the concept better.
The sub-categories are:
Product-Solution Fit: It is the process of finding a solution by dint of your product that can solve a current problem. Simply put, if your product is able to deal with the pain points of consumers, you have created a successful product. Product-Solution Fit is particularly important for startups because they can find ways of providing a solution that has the potential of being monetized.
Product-Language Fit: Finding the right language to communicate your idea/ product to a new market is crucial. The best approach is to think like your consumer and use direct and clear language to send your message across. In today’s time, when potential customers are being flooded with messages and ads from everywhere, clear and functional messaging is what a startup needs to make a solid point.
Product-Customer Fit: It is about putting the product to test by putting it in front of the right people/ audience. Ideally, you would want to reach a specific group of people who would be willing to try your product or service. Based on the feedback you can get from such people, you can have the opportunity to add improvements.
Mastering a product-market fit can be approached from two main potential ways:
The first path begins with you finding a problem or pain point in the world. You work on solving the problem with your product. The next step is to find the right language to reach out with and advertise your product. Once you discover the audience you need, you put out your product to test.
The second way is the reverse of the aforementioned method. You begin with finding your audience. For instance, you want to provide a service to a certain group of consumers. You develop the language or messaging to reach out to them and then define your product that can help them with an issue they are struggling with.
Steps for Perfecting the Audience:
Here is a list of six simply explained steps that one can take to perfect their company’s audience.
Research about your current customers or potential buyers. If you do not have current customers, you can create a list of 10 to 20 companies that can become customers in the future. The most important thing is to pinpoint the common feature amongst all such companies.
Here is a brief checklist that you can use:
Who are they and where are they located?
Which value are they looking for?
What are the common pain-points?
What product(s) had they been using to solve the problem?
If they are a customer, how has their feedback been?
These questions help you identify your current customers and their behavior.
Define your new audience. Once you know the profiles of your current customers, you can better define the profiles of your new audience by means of a scoring algorithm. Scoring your audience can help you distinguish between possible closed deals from lost opportunities. For more detail on prospect scoring, follow the link to a brief reading.
You can define the companies based on very specific features such as:
the number of web pages,
location(s)
ads spent
job postings
Your new audience comprises companies that you would like to work with as your product matches their needs and they match the profile of your ‘Ideal Customer’.
Understand your new audience. During this step, you focus your energy into analyzing how your new audience is behaving. What are their pain-points? What kind of challenges are they facing in the current market?
Once you fully understand their problem, you can devise ways of seeing how your product can help them. For instance, can your product help a struggling SEO company find more B2B leads? If yes, approach them!
Define your message and channel for your new audience. Before reaching your audience directly, it is of utmost importance to analyze which kind of message you need. The way you would approach and talk about your product would (read: should) be different if you are talking to a sales representative or the CEO of a company. Finding the right language can make all the difference. This is where Language-Market Fit comes into play!
Reach them. After you have finalized your product, audience, and language, it is time to reach the prospects and tell them about your product. This messaging can be through various such as email, LinkedIn and Twitter messages, direct calls, etc.
Either scale up if it is successful or redefine your audience. Once you have taken all the steps, scale up the process to maximize the benefits. On the contrary, if it has not brought the fruits you were expecting, then there must be a flaw in the system that can be worked on. Redefining the audience or the language is not a total failure, in fact, it can lead to numerous other wins!
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Analyzing the market while introducing your product can make all the difference otherwise, it is equivalent to throwing a dart in the dark. The prior work on product, audience, and language is rudimentary in drawing the results you want.
We are willing to hear how you are progressing with finding your market fit; connect with us on LinkedIn or visit our website to reach us!
