When I backpacked through Europe as a student, using ripped out pages from Let’s Go Europe as my guide (it was too heavy to carry the whole thing and this was before the Internet), I looked for three things in a hotel. In order of priority, they were: Cheap. Easy to walk to from the train station. No bedbugs.
Now my priority list is very different. I want charm, comfort, quiet, and an easy walk to interesting restaurants and cultural spots. My budget is considerably higher.
There is no way one brand can cater to both those types of people. Even “budget” hotels (which were beyond my budget as a student) or mid-priced hotels (which are too generic for me now, if I have a choice), need to pick a target customer.
Trying to be all things to all people pleases none of them. It’s like “one-size fits all” pantyhose; too tight for some, too long in the leg for others…. Just not a good idea.
Have you thought through who your ideal customer really is?
By “ideal” I mean, realistic ideal. Ideally I’m sure we’d love to have customers who would pay top dollar and tip our staff with $100 bills. But, honestly, what sort of person is your business best suited to?
- What are the benefits you can offer that make you special?
- What sort of person would appreciate those benefits enough to pay for them?
Sticking with the hotel example, is yours a non-descript hotel in the heart of the business district? If so, maybe your ideal customer is a no-nonsense business person on a bit of a budget. You can flesh out your understanding of this prospect and help keep your decisions on track by developing what is called a “user persona”.
For each of your key customer types, put together a sheet on which you have a “sample customer” fleshed out to seem like a real person. The more real you can make them, the easier it will be for you and your staff to tailor your service and systems to meet the needs of that type of person. Even include a photo and give them a name.
Your persona might look like this, for example:
Persona: Desmond Johnston
Desmond is 35 years old. He owns his own IT consulting firm, which has been growing rapidly. He’s in negotiations with a venture capital firm based in [your city], which has him visiting regularly as the discussions progress. If the deal goes through, he will still need to visit often to meet with advisors from the VC firm.
Desmond is married, and has two girls, aged 3 and 5. He really misses them when he travels. His wife, Tonia, recently quit her job as a social worker to focus on the kids and help with the business. She now makes the arrangements for his business travel. She wants him to be comfortable, but is very aware of the fact that the company doesn’t have a lot of money to spare yet.
He’s known as being friendly and helpful; a good people person. At the same time, he’s demanding, driven to grow the company quickly. He has high standards for his staff, his family and himself. He likes everything to be tidy and organized, so he knows where he can find what he needs at a moment’s notice. He dreams of one day getting the business to the point where he can take six months off to sail around the world with his family. He also wants to be able to save so that he’ll be able to send his girls to the best schools and ensure they have a great future.
Overall Desmond is happy with his life, but he does often wake up at night worrying about the business and things he needs to do. He’s not fully used to having to manage staff yet, and feels the pressure of being responsible for 18 people and their families.
Being in IT, he’s connected to the Internet at all times, except when he’s in airplanes. He doesn’t use social media much, but he does connect with other IT professionals in techie forums. Tonia is on Facebook a lot, staying in touch with friends and family, and sometimes getting advice about places to stay or services to use.
“The point of the persona is to get inside your ideal customer’s head.”
You’ll see that the point of the persona is to get inside your ideal customer’s head. You want to really “know” them, as if they were a friend. You want to understand what motivates them, and how they think.
Now that you have Desmond in mind, you may conclude that he wants to be close to where his meetings will take place, his expense limits don’t extend as far as the premium hotels, and for now the hotel really isn’t his focus, as long as it meets his needs.
What might those needs be? Very likely they would include things like:
- Clean, well-organized rooms
- Comfortable beds
- Fast, efficient check-in and check out
- A breakfast buffet, where he can choose what he wants and get moving quickly.
How would you differentiate yourself from other hotels that were in the same basic location for a target customer like Desmond?
First of all, optimize the efficiency. Odds are efficiency is key to this type of traveler. But beyond that, personalizing the customer service is likely to be what can make you stand out. Desmond hopes to get rich, and may well dream of the day when he can afford to stay in a pricey hotel where he’s treated like gold. So try treating him like gold at your facility. This doesn’t have to cost a lot of money; it is more about staff training and attitude. Greet your customers by name. Make sure all your staff smile and say hello. Keep track of whatever you learn about them over their visits, and have that information pop up so your front desk staff can casually ask after the family, or the business or how the trip to Asia worked out. This will give the guests a sense of belonging that will make them loyal to your business.
Use Research, Not Assumptions in Developing Personas
That said, these are assumptions, and assumptions are not the best way of developing personas or strategy. You want to base them on real market research.
If you have already been operating for a while, talk to your customers. Surveys help, but go beyond that. Ask a random sampling of your customers if you can buy them breakfast or an after-work drink (one on one) and learn more about them. Probe to uncover what they have really experienced with your business and how they compare it to others.
- What do they like?
- What frustrates them?
- What would their ideal company offer?
- Why did they choose to use you?
- What would make them want to recommend you to their friends and colleagues?
Your top executive should have such customer meetings at least once a week; preferably more often. This is not a one-time venture. Perceptions change constantly, as the competitive landscape changes. You cannot afford to rest on your laurels. There’s a reason why many of the big companies of your youth no longer exist.
Other Types Of Market Research
Probe other research too. You want to combine the insight you can get from talking to customers with knowledge you can gain from looking at data. There are many places you can get this valuable data. If you have a physical location, like a hotel, even before you buy or rent the space, you should be looking at publicly available data about the neighborhood you’d be located in. If you’ve been in business for a while, you’ll want to update this information from time to time, as neighborhoods change over time.
At the most basic level, find out how many competitors you have and where they are. If you want to get really devious, chat with people you see coming out of your competitors’ businesses and ask about their experience there. This may help you identify weaknesses you could benefit from, as well as giving you more insight into what your potential customers are looking for in your type of business.
A B2B Market Research podcast episode I just listened to suggested asking former sales reps of your competitors about how they sold. What were their key selling points that worked with customers? Who did they perceive as the major competition.
Take time to go through your web analytics. (If your website doesn’t already have a program tracking visitors to the site, you can install the free Google Analytics program easily and should do so right away.) Looking at where people go on your site, and how many of them turn into customers will help you identify possible trouble spots.
Likewise, get as much data as you can from the 3rd party sites where your business is listed. This type of data, for example, may help you discover that your business is particularly appealing to people from a certain country or region, in which case you can play that up in your design or features, and do more advertising in those areas.
Big companies can do sophisticated analysis of “big data” on the patterns of their prospects and customers, but even if you don’t have access to that level of data, there’s a lot you can do now to get a better grip on who your ideal customers are and how you can serve them best.
(This is a version of an article that first appeared in the “other” HBR: Hotel Business Review Get more articles by Tema Frank at http://frankreactions.com or by signing up for the Frank Ideas updates.)