By Emmanuel Itori
The lifeline of every business is enmeshed in the number and interactions of stakeholders as well as their activities in relation to the business. These stakeholders include the suppliers of the raw materials needed for the business to manufacture its offerings, the employees or human resources who engage in the production and the customers who are the end-users and the most important stakeholder in the cycle.
The Customer
Customers are consumers or end-users that products or services are made for in order to satisfy their needs with a series of unique experiences. The customer in turn has a unique role to play as their consistent purchase makes them become the most important stakeholder in a business.
The major reason businesses collapse is for lack of customers as customers generate cash-flow for the business whenever they make purchases, therefore, contributing to increasing the sustainability of the business to remain afloat.
The uniqueness of the customer does not trivialize the role of the supplier and employee but then without the customer, the aim of building a business without an end-user is defeated.
The Nigerian market is characterized by different categories of customers and the ability to understand the type of customers a business attracts through their purchasing behavior and data-driven approach will support the growth of a business as they will understand how to position their offerings in order to attract the specific customer segment they want and also secure a reasonable market share through intentional strategies.
Here are the five customer types and what we need to know about their personality traits in order to sell to them.
Innovators (2.5%)
Innovators are the type of customers whose buying decisions are risk-driven. Innovators are the youngest in age and willing to experiment upon seeing a product or service they desire to use. The personality trait of innovators is that they are impulse buyers, their need for adopting a new product has no regard with respect to whether they have budgeted for it or not. Because they are risk-takers, they easily adopt new technological solutions and while they can easily help brands to get exposure by putting these products in the presence of other potential users, they might lose their financial resources if such solutions fail based on some limitations. The Innovators account for only 2.5% of purchases made.
Early Adopters (13.5%)
These categories of customers are the second set of individuals to adopt an innovation after the Innovators, they are called the Early Adopters and they account for only 13.5% of purchases made.
The Early adopters are also very young in age just like the Innovators and have a high social status and reasonable disposable income. They are opinionated and can be regarded as thought leaders. Because Early Adopters are judicious in their choice of adoption, they can easily maintain a central communication position, especially in giving reviews.
Early Majority (34%)
The Early major only adopt new solutions when a degree of time has passed after the launch of the solution into the marketplace. The time is taken before they adopt any solution is usually longer than those of the Adopters and Innovators. They usually tend to be slower when it comes to the adoption of a solution and only belong to the above-average income class, however, their contact with Early Adopters eventually informs their decisions about eventual purchases. They also rarely hold an opinion that is the direct opposite of what the Early Adopters do. They account for 34% of all purchases.
Late Majority (34%)
The Late Majority only adopt any form of innovation after the average in the society has done that. Their approach to innovation is with a high degree of skepticism. They are far from being risk-takers as they are low on disposable income and want to avoid mistakes when making purchases since their income is limited. They are also characterized with very little financial education, are in contact with those in the Early majority and their peers, and possess not much opinion leadership. They account for 34% of all purchases just like the Early Majority.
Laggards (16%)
The laggards as the name implies are the last to adopt any form of innovation. These individuals have no respect for change as they hold on to their first generation of solutions and do not consider a change of such a solution except if there is a breakdown of such a product or it no longer works again, only these circumstances make them embrace change. They are traditionalists and are usually elderly, have very little disposable income, the lowest financial education and are only in touch with family and friends
All customer types make their unique contributions to serve them and grow a business; their role in the value chain supports the sustainability of a business in different dimensions.
The early majority and the late majority are usually the difficult set of customers, however learning to sell to them by winning their confidence and serving them right, has the ability to increase repeat purchases as they both account for the highest percentage in overall purchases made.
Customers are never the same and understanding how to serve them uniquely in a particular market, holds the key to profitability.
Emmanuel Otori, the writer has worked on the GEM Project of the World Bank, Conducted training for entrepreneurs and professionals at the Abuja Enterprise Agency and has over 8 years of experience working with over 50 SMEs across Nigeria.