“If I had asked people what they wanted, they would have said faster horses.” – Henry Ford
Building and growing your business depends on you understanding what your market is wanting and needing. What often gets forgotten or unaddressed is that there are two ways to understand our markets: we can look at what they’re wanting and needing now (market demand) or what they’re going to want and need in the future (market projection).
Market demand is what most small business advisors talk about. Most of the advice is about syncing your business offers and marketing around what people are demanding.
There’s good reason for keeping your eye on what your market is demanding: it’s where you’ll find your short-term cashflow and it’s a great place for beachhead initiatives.
A business that only focuses on what the market is currently demanding, though, will lose to entrepreneurs who have the foresight to both see what people think they need and what they actually need now and in the future. Those latter entrepreneurs become the industry leaders, where the businesses who just focus on market demand are always a step behind where their market is and several steps behind where the leaders are.
That foresight is what I call market projection. Whereas market demand is about the past and present of your business, market projection is about the future of your business and industry.
We have to be careful with market projection, though, because it’s entirely possible to start along the path of taking our tribes where they don’t want to go. What gets confusing is that sometimes our tribes don’t know where they really want to go and other times they think they want to go somewhere when you know they don’t.
For example, many people want to start an online business because they’ve been led to believe that it’s easy, quick, and profitable. They’ve been conditioned to think solely about launching their first product, so what they’re demanding are resources around product creation and launching. From my view, what they actually need is a better strategy and business model – they’re starting their business by focusing on tactics rather than strategy, and I’ve seen where that goes.
This is an age-old problem, though, and it comes down to selling them what they want so you can deliver what they need, all without it being a true bait-and-switch. At least, that’s what I try to do – I think we all know people who are happy enough just to sell them what they want without thinking about what they need.
The case above is an example of when what people want and what they need diverge, but there’s also another case in which people just don’t know where they’re trying to go. A prospect with that particular psychography has a bit of the Shiny Bauble Syndrome, for he’ll spend a lot of time pursuing attractive opportunities without actually committing to any of them.
When you start thinking about market projection, the chief question is “Am I taking my market where they truly want to go?” If you make sure where you’re taking them has practical, useful, and resonant benefits for them, then you’re in a good position. If your desire to take them somewhere is predominantly based upon where you want your business to go, you need to reassess.
Obviously, since this is a discussion on strategy, I can’t tell you in a post what you should do in your business. I can leave you with some guiding questions, though, so here you go:
- What is your market currently demanding?
- How does your business address what your market is currently demanding?
- Do you have any business activities that don’t address what your market is demanding?
- Where are you taking your market? What competencies, capabilities, and solutions are you wanting to deliver to your market in the future?
- Has your market expressed a desire to go where you’re taking them?
- How does your vision for where you’re taking your market relate to their current demands?
The bottom-line: you have to serve your market’s needs and wants today and prepare for what they’ll need tomorrow. Focusing solely on today forsakes tomorrow’s growth; focusing solely on the future doesn’t give you the resources to grow into the future.
A lot of great info here. I think this will take a little while to sink in and I may have to re-read in a few days. I completely agree that market projection is necessary for a successful business. I think the reason most businesses focus only on the current demand is because that is the easy part. Being one step ahead takes more research and work.
I’ve always felt that there’s an element of leadership in business ownership. Sometimes I’m led by my clients – when they ask for a particular offering or opportunity – and sometimes I lead them – when my offer to them causes a “Aha! That’s what I need!” response. You’re so good at clarifying leadership, Charlie, and I thank you for raising it in this context. You’re definitely leading us all on this one.
You’ve made some great points, Charlie! It’s an interesting time to scramble to meet current demand, yet envision where your business and market demand will be in the future. It seems to be a fine line between “going with the flow” and “directing traffic”. I love Michele’s comment about responding to clients, yet providing that “Aha!” moment. I am a new follower of your blog, and already a big fan- Keep up the great work!
Great post – I do agree that future needs are also important, but there”s no question to me the current demands of the market is what should be looked at first. If you are not addressing a need right now, but addressing something that’s a future theoretical need, there’s no cash flow right now. W/o cash flow, your business eventually dies
Solid stuff, Charlie.
To me, this feels a lot like business whispering. Listening to your clients and your work and your mojo and seeing how they all dance together.
This also reminds me of creating music. Sometimes it works just to flip a switch and see where it goes. Spontaneity and nowness can be awesome.
But usually something way more awesome shakes out when you have some idea of where things will end up. Because, when you do, you not only know what instruments you need, but what to play now and what to play next.
Big thanks for the goodness + the smarts.
I think i have a bit of that syndrome in me as i do tend to try everything that catches my fancy at the moment, but i’m trying to keep my focus this year. hopefully your guiding questions will keep me in the right track as i invest into a new business. thanks!
Hey Chuck!
Does anyone call you chuck? It felt fun, sorry if you didn’t like it.
Anyway – I love this post because you are so on the mark about discerning where your market is heading. By being able to forecast changes in your market you can be there for the new demand as it arises, and in marketing the first in time wins big.
I also think it’s important because it demonstrates that you really are listening to and “get” your audience. In the long run this is going to enable you serve your audience in bigger and bolder ways.
Thanks for the insights Charlie! 🙂
P.S. Loving the redesign, very fresh and zen. Is this a genesis theme?
The market is growing every day and I think your market projection idea is something we should follow. However, a market might be unpredictable some times and making a projection that could be wrong is something we should keep in mind. Here is the concept of market segmentation enters and solves the problem by splitting all market in groups therefore any projection may be more accurate.
This is an awesome concept Charlie!
It completely dovetails with my belief that you have to have a bigger vision for your ideal customer/client than they currently have for themselves.
Only then can you serve them at the highest level and keep them as raving fans because you this makes you keep evolving just to keep your edge but as a by product your ideal customers/clients benefit because you share with them what you’re discovering so you end up bringing them along to the next level WITH YOU.
Market projection is a great thing but it can backfire if you don’t do it right. If you foresee the market direction wrong it will do you more damage than good as you will loose valuable time for things that will not bring you back your investment.
Keep up the good work.
Cheers Alex
I believe that in order to be successful in your market, you must have a clear idea of what you want your business to look like. Ypu should have a vision, so you can analyze your business’s own strengths, competition, market’s preferences so that you can come up with several possible strategies to get where you want to be. The real businessman knows that the biggest opportunity cannot be bought, but something he can only create himself.