If you work in banking or financial services, you’ll be familiar with the legal phrase “Know Your Customer” or KYC. To prevent fraud and money-laundering, it’s a requirement to be fully informed about the people you’re dealing with. For entrepreneurs, the context may be very different, but you should think of “KYC” as an inviolable law of branding. It’s a matter of common sense: without knowing who you’re talking to, you’ve no hope of landing the right messaging.
Think of your brand as an electrical contact point. It’s the meeting of what you offer with what people want. That contact should be as clean and clear as possible, so the strongest possible current flows between you and your audience. You already know everything about what you offer (well, you certainly should!). About the people you’re talking to, there’s always more to learn.
Familiarity Will Fool You
The greatest barrier to knowing your customer is in your own mind. Entrepreneurs suffer from the curse of knowledge. “I’ve been selling to these folks for years… I know everything about them.” Sorry, that’s a mistake. Human beings are too complex and too hidden for any of us to be that confident about what’s driving other people.
Take the example of Carhartt, makers of workwear. Carhartt long saw its audience as traditional, blue-collar workers. But that meant they were missing out on a whole crowd of urban fashion fans and outdoor adventurers — people who actually loved the brand for its toughness and style. This new customer base found Carhartt on their own, more by accident than careful market study.
The first principle you have to grasp about knowing your customer is that this is a journey that never ends. So long as you’re in business, you can always be learning about your target audience. So let’s dive in and look at what you need to discover.
Your Avatar Won’t Save You
Many marketers will recommend you start by creating what’s called an “avatar”. This is a fictional character who represents your ideal customer. In this popular exercise, you give the avatar a name, age, profession, salary, and lifestyle – just as if you were sketching out a character for a movie or novel. There are benefits to the process: it helps you think in terms of t\real people, not a generalized and impersonal category. There are problems, though. You probably don’t know enough yet to write an effective avatar. You can have fun in your imagination, but until you’ve done your research, your avatar is just make-believe.
Another drawback is choosing where to focus. It’s rare that your brand audience is confined to just one group of people. Let’s imagine you’re selling a nutrient-rich protein shake. Your target audience could break down something like this:
- Athletes and fitness enthusiasts looking to build muscle and performance
- Young mothers too busy to fix a meal for themselves
- Middle-aged folks trying to lose weight
- Biohackers hoping to reduce their biological age
But it doesn’t stop there. You might also be thinking about audiences that don’t buy your product but influence those who do, for example (in this case):
- Natural health practitioners
- Fitness trainers
- YouTubers and social media content creators
- TV and print journalists in the lifestyle sector
So which of these should be your avatar?
The Brand-Defining Audience
Although you may have many audiences, your brand will be stronger if you prioritize one customer group out of all the possible ones. That doesn’t exclude a spread of targets. It just means your marketing has a clear focal point. Now you’re asking yourself: “Where amongst all these possible audiences is my greatest revenue potential?” There’s another question you should also be asking: “If I emphasize one of these groups, how will that feel to the others?” In our example, focusing on young mothers might exclude your middle-aged weight loss customers. However, focusing on fitness enthusiasts – done right – could feel relatively inclusive for all the potential targets, because even those who don’t work out like to imagine themselves getting fitter than they are.
We could all this priority group your “brand-defining audience.” It would be the one for whom you design your first avatar.
Here are a couple of examples. The online consignment brand ThredUp had a huge potential market. But they stepped away from trying to reach everyone. Instead, ThredUp zeroed in on eco-conscious, budget-smart millennials and Gen Z. These buyers wanted sustainable fashion and a smart way to update their look without feeling guilty. That focus didn’t exclude older, more traditional customers. It just allowed the brand to have its own distinct flavor.
Yeti could have sold to anyone needing a cooler, but they sharpened their aim at serious outdoor enthusiasts—hunters, fishermen, and adventurers. These are folks who demand extreme toughness and performance, even if it costs more. That focus attracted a much wider aspirational audience, folks who just like to imagine themselves braving the elements.
Know Their Pain
If the task is to know your customer, the next question is: What do you need to know?
Demographics is not the answer. Gender, age, ethnicity, education level, socio-economic status: these are the checkboxes beloved by marketers, but they tell you way less than you might hope. They are simply clues pointing to what really matters: psychographics. In other words, the hopes, fears, needs and dreams that shape people’s lives and drive their buying decisions. Of course, this is much harder information to come by. You’ll be tempted to make assumptions, especially if you have experience dealing with the audience you’re looking at. The curse of knowledge kicks in, and you trust too much to your “instincts” about what matters to the people in your sights. Your intuitions may spare you the labor of doing research, but they won’t serve your brand long term. People are complex, and no matter how much experience you have, there’s more to learn. You need to do some research.
“Market research” can sound intimidating to the average entrepreneur. It evokes images of expensive experts conducting endless telephone polls and focus groups. You can relax. People are complex, but they’re also very much alike. Statisticians may not be satisfied, but you can get a reliable read of your audience from a pretty small sample. You don’t need to pay for focus groups (which are anyway filled with bias hazards). You can skip polling large numbers of strangers. In most cases, you can safely reach out to the people in your vicinity — so long as you’re very careful how you frame your research and phrase your questions.
The problem you have is that people are mostly nice. They’ll want to make you feel good, especially of course the ones who know you. That’s why the worst question you can ask is “Do you like this product idea?” The answer will tell you everything about the human tendency to please, and nothing about buying intent. Here’s what you really need to know:
Where’s your pain?
- What is it costing you? (Financially or otherwise)
- What would you be willing to pay for this pain to go away?
- How are you trying to solve the problem now?
- What are your frustrations with your current solutions?
- What would your ideal solution look like?
If you can gather even a portion of this information, you’ll probably be better informed about your market than 90% of your competitors.
In the business world, Slack hit on the pain points of messy communication, endless emails, and clunky project management in the workplace. Their win came from clearly defining these frustrations and then offering a solution that met the problems head-on. Companies have shown at massive scale their willingness to pay for the pain to go away.
As for consumers, James Dyson spotted the frustration of vacuums losing suction because of dusty bags. His early marketing hammered home the cost – in cash and aggravation – of constantly replacing bags and watching performance drop. He pitched his bagless tech as the fix people would pay for to cure that familiar headache. And pay they did.
Low Cost Research That Works
The best way to capture the knowledge you need is a mix of online questionnaires and individual interviews. Use whatever list you have, and send out a short survey — no more than six questions. If you can offer an affordable incentive to get responses, so much the better. In your survey, ask people if they’d be willing to take a short call from you to discuss the questions further, making sure to capture their contact information. A small percentage will agree, and that’s enough to greatly enrich your results.
A broader way to gather knowledge about your brand audience is through what’s loosely known as “social listening.” Here again, you can pay large sums for a specialist agency to do the work for you, but a small effort of your own will go a long way. The idea is to identify the target audience and then trace where they hang out online. The best sources can be Facebook or LinkedIn Groups, because this is where people talk freely about their needs and frustrations. You can also check conversations on X, Reddit or Quorum. Be clear before you begin about what you’re looking for, otherwise you may pour valuable time down digital rabbit holes. In whatever field your product is positioned, you want to know what irks people, what pleases them, which solutions they are trying, and where their biggest frustrations lie. All this offers priceless fuel for your brand positioning and marketing messaging.
We can’t know for sure, but it’s a good guess that mattress maker Casper observed discussions on forums like Reddit’s r/Sleep and and a whole slew of design and lifestyle blogs, to understand what people what about common frustrations traditional mattress shopping: confusing choices, pushy salespeople, inconvenient delivery. That kind of data will have helped them shape their successful direct-to-consumer sales model.
“Know your customer” applies first and foremost to your brand-defining audience. But as you identify all the key groups you need to bear in mind, the KYC law applies to each and every one of them. Which means, unfortunately, you probably have more work to do in this area than you may have imagined! Progressively, you want to learn about the pains, attempted solutions, frustrations and dreams of each target audience. Be sure to watch for the language people use, not just the information they share or the sentiments they express. In their words you may find some of the best possible material for your marketing messaging.
Ultimately, your task is to do everything you can to see — and feel — the world from your customers’ point of view. The ultimate purpose of research is not to deliver data, because data alone can’t define your brand. The task of research is to inform your imagination, so that when you try to see and feel and think like your customer, you have a better chance of success. It’s your ability to stand in the customer’s shoes that commands the success of your brand. Why? Because, as we’ve established, your brand is the meeting point between what you have to offer and what your audience wants.