Find your customers in three easy steps

Establishing a start-up is tiring work. It’s not easy for entrepreneurs to juggle the competing demands on their time. From development to testing, marketing and raising capital, it’s tough keeping all the balls in the air ... and unfortunately it’s often a focus on customers that smashes to pieces if one hits the ground. You are so busy talking up your app – which is clearly going to change the world – that you fail to notice customers couldn’t care less.

I thought I would share one particular view, which might help early-stage entrepreneurs to regain some focus.

After challenging himself to build a start-up in seven days with less than $500 in seed capital, Sebastien Eckersley-Maslin came up with his simple “Customer 1, 2, 3” philosophy (you can read about his 2010 journey on his blog). Eckersley-Maslin shared this philosophy at the Microsoft APAC Entrepreneur Summit this week and says he now applies it to the companies that sit in his incubator Blue Chilli.

He reckons there are three customers that every business needs.

Customer number one is the original target. He says start-ups should first “find out what your customers want so you can give it to them”.

Customer number two allows start-ups to distribute their product more efficiently or “achieve scale” through bulk partnerships. “It’s a lot easier to sell to one person who buys 1000 [products] than it is to sell to 1000 who each buy one,” Eckerlsey-Maslin says. “You want to target your customer number two as quick as you can.”

One company that is operating out of Blue Chilli’s incubator is Style Rocks – an online retailer of customised jewellery. The initial customer was women who wanted to design their own jewellery online, but founder Pascale Helyar-Moray found “a nice surprise” in a secondary customer: companies. A marketing department of a big-four bank used Style Rocks to design a necklace, which it then purchased in bulk to give out at events. No surprises that Helyar-Moray is looking for more corporations to become her customer number two.

Finally, customer number three is “the one that’s often forgotten or often thought of, but it’s usually too late,” Eckersley-Maslin says. “That’s your strategic customer. It’s the person who’s going to buy you out. It’s the person or company that can make more money than you can from your business.”

Sounds simple enough, right? Does your start-up have these three customers?

Do you agree? Write and tell me your views.

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