Entrepreneurship

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1) Why is it important for entrepreneurs to define and identify who their customers are? What strategies do entrepreneurs use to determine customer needs and wants? Be specific, using resources, concepts, information and cites from the course text.

It is very important to know what kind of clients and customers a company wants. It may be obviously silly to ask this because every organization would want all customers and clients to purchase their products/services. However, identifying and defining your potential customers is the key to success. Businesses spend their hard-earned dollars to market their products and it would be good to focus on the target market rather than spend for customers who are unlikely to benefit from the product or service offered. It is essential that companies identify the market they can best serve before they set out to launch their marketing campaign so that there are more chances of sales and return on investment. It is very impractical to spend for marketing campaign to people with unrelated interests. It is the shortest route to failure and away from success. Other reasons for the need to identify target market: customize marketing campaign, save on effort and expenses, more focused and result oriented strategies, identify concentration of customers and analyze competition, maintain best pricing and quality to retain customers, and the customer data will serve as a good resource to important information about the market of the company's products.
Among the strategies that organizations and market research companies use in identifying potential customers is market segmentation. It is the process of categorizing a market into defined groups with comparable attitudes and behavior. There is a better probability of a favorable response to a marketing initiative when the company knows who they must target in terms of advertisement campaign. Other techniques used: gathering data from customers through interviews, focus groups, product observation in use, then interpreting the data ...