We know who we want our clients to be, but we do not have very many of them today. Can this kind of program work?
A common problem many companies face--whether they are a startup or established business--is gaining more specific clients. Often, they have two or three customers they absolutely love to work with, but 80% of their revenue is coming from customers that are marginal at best.
So, what happens when a business knows who they want their clients to be, but they do not have very many of them today? What kind of program will work?
What the above problem usually tells us is that a company does not have product/market fit.
Product/market fit is something that is extremely well-known in the product management world but is not typically spoken about among the sales and marketing departments and in C-level suites.
Product/market fit refers to the degree to which you know exactly who your ideal buyers are, what quantities and durations they purchase your products/services in, and at which price they will pay for those products/services.
You can determine if someone has product/market fit in the early stages of engagement when they are starting to build their buyer personas. Those that have product/market fit have at least 5-10 clients on their current client list that are similar to the kinds of customers they want to attract. If they do, they can interview and survey those clients directly. If they don’t, it is critical they are realistic about their lack of:
- Product/market fit
- Knowledge of the average client’s lifetime value
- Knowledge of the average client’s acquisition cost
Revenue is important, but what is even more important is getting to product/market fit as rapidly as possible.
Knowing your metrics is extremely important. The goal for this kind of program should be to get your company to product/market fit as rapidly as possible. Once you do that, your business can be unstoppable.
Does your company have product/market fit nailed? Let us know in the Comments below.
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Topics:- Go to Market Strategy