Business experts can offer outside perspectives on ways you can improve your business. The Shopify Masters podcast featured many of these experts in 2023, from venture capitalists to marketing specialists to a city economist.
And there’s one thing they all agree on: You can never know enough about your customers. It’s extremely important to continue deepening your relationship with your customers, whether that’s through community building and marketing or leveraging data and artificial intelligence.
5 tips for understanding your customers better
Four experts share their advice to grow your business by learning more about your customers.
1. Start with a hypothesis
Many entrepreneurs go straight to back-end reports to find out about their customers, but there is often so much data that it’s easy to get overwhelmed.
Neil Hoyne, the chief strategist for data and measurement at Google, recommends that you start with a hypothesis before you pull any reports. “We're starting with the question, what you think you should do differently, where you think there's an opportunity,” Neil says. “And then all those reports work to support that, as opposed to the other way around.”
Figure out which metrics matter in your business goals before turning to reports. For example, if you’re trying to increase revenue, hypothesize how you could increase average value order.
2. Understand how people make decisions
Maryam Haghighi is the Bank of Canada’s director of data science. She advises founders to learn about behavioral economics and psychology. “Understanding how human beings make decisions has a direct impact on your business,” Maryam says.
Humans aren’t always rational beings when it comes to consumption. They love stories. Make them care about your product and give them an opportunity to be the main character. “Sometimes their decisions are not data-driven at all,” Neil says. “They may pay more for those products or features [you] didn't think were important.”
3. Focus on finding acquisition channels
Ashwinn Krishnaswamy, founder of the growth and design agency Forge, says it’s not enough to have good branding or design to be a successful direct-to-consumer business. To stand out, you’ll need to find out where your customers are and how best to reach them.
“One of the things that not enough founders are thinking about early on is distribution and customer acquisition,” says Ashwinn. ”That is the true make-or-break for the business.” He encourages founders with early-stage start-ups to experiment with both paid advertising and organic content to see what works best for them.
4. Own your niche
Once you find out who your customers are, don’t be afraid of marketing to them directly and doubling down on a receptive base. “If you think you're too niche, I'll suggest you're not niche enough. You haven't gone deeper,” Ashwinn says.
Jason Feiffer, the editor-in-chief of Entrepreneur magazine, recalls a company that made compression socks for athletes. However, most of the brand’s customers were not athletes but workers who spent all day on their feet. Once the company was able to change their marketing strategy and product line, they unlocked much more growth.
5. Pitch stories that appeal to the audience
As a magazine editor, Jason gets many requests to cover certain companies or founders. “You have to understand that the media is not a service provider. People who work at a media organization are not thinking of themselves as being there to support you,” Jason says.
To get more coverage in media outlets, understand the publisher’s audience in the same way you know your own customers. After all, readers or viewers or listeners are the publisher’s customers. If you want to work with a media outlet, pitch stories that demonstrate value to the media company’s customers—it might even help you gain more customers, too.To hear more advice from some of the experts interviewed on the Shopify Masters podcast, listen to our roundup episode.