Recently while brainstorming an idea, we tried to find out who our competitors are and what our differentiating factor is. Our differentiating factor boiled down to the fact that most of our biggest competitors in the field are targeting someone else as their primary customer, changing the entire design of their offerings. And as expected, our biggest fear becomes the competitor which is targeting the same primary customer base as we are planning to go after. To identify the primary customer base, and strategize the product around it is as important as anything else in a business.
Consider two blogging platforms as an example. I use WordPress to blog. WordPress provides bloggers a great set of tools to make blogging easy. A decent editor, excellent reports about the readership of the blog and great way to customize the blog makes WordPress an attractive choice for bloggers. The bloggers are the primary customers of WordPress, and WordPress focuses its resources towards their needs.
On the other hand, consider some other platform that provides a whole lot of services along with blogging, but with no special tools to help bloggers. For that platform, bloggers are not the primary customers. The primary customers may be social networkers, communicators or for that matter anyone else, and they might be serving them with excellence. The important thing is to have one and to know who that is. There’s nothing wrong in offering secondary services to your primary customer base because that might serve some of their needs and help you retain them.
The point to note here is, you must know your primary customer base and work to serve their basic requirements first. I believe having a niche as the primary customer base to start with will increase your chances of being successful. Reason being you will have a really focused group and you will know where to allocate the resources…after all, great strategy is all about allocating the resources in the right way.