“There are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are unknown unknowns – the ones we don’t know we don’t know.”
The above statement was made by Donald Rumsfeld, former United Secretary of Defense on February 12, 2002.
Start with the fundamental purpose of trading – that is, begin your improvements of your marketing strategy by defining the best fit between the customer problem and your solution. The greatest impact in this area will come from ensuring that you know what the customer wants and the customer knows what you offer.
While this might seem simplistic, it is amazing how many times you see this disconnect. Far too often a firm cannot describe what they do, how they do it or who they do it for. More specifically, they can’t describe succinctly the problem they solve.
Let’s be blunt – if you can’t say what problem you solve, then how is the customer expected to find you?
Far too often entrepreneurs and their sales staff talk in terms of features and functions, accessories and supplements and how they compete. But if you are not technically conversant with the particular technology, science or activity they are immersed in, it is very easy to end up with your eyes glazed over wondering why you exposed yourself to a content dump.
If we use the known/unknown matrix, you can gain an appreciation for part of the problem.
We can look at this problem from another angle – that of consumer buyer behaviour. Using the basic model outlined by Howard J.A and Sheth J.N ((1969), the Theory of Buyer Behavior, New York: John Wiley and Sons).
This model suggests three levels of decision-making:
The consumer already knows what they want, will usually buy the same brand or item each time. They normally don’t evaluate alternatives. This would be a known:known. That is, the vendor simply has to make the product easily available for the customer to purchase. This type of buying behaviour would characterize most frequently acquired household items.
In this situation, the customer has some knowledge about the products and brands available but would need to undertake some evaluation before purchase. This situation could easily apply to known:unknowns. That is, the customer is not sure what will solve their need but the vendors known exactly what will. The vendor’s task is to educate the customer so they recognize that the vendor can solve their problem.
On the other hand, the customer might know what would solve their problem but has to track down the vendor which can satisfy the need. This is also a situation where the product or service might need to be adapted to suit the customer’s requirement. This can be complicated for the customer as the vendors might not be thinking about the type of problem the customer has, or might not see their product or service as solving that type of need.
This type of problem solving occurs when the customer has limited or no knowledge of the available products or services or is sometimes unclear on how to solve the problem or need. It also describes the situation where the vendors have limited knowledge of the customer’s situation and they need to undertake a discovery process to uncover the need. Sometimes this latter process occurs while the customer is also undergoing an education of what could be done or supplied vs. what the ideal solution might be – if they could even define what that is. This situation probably fits best into the unknown:knowns and unknown:unknowns.
As you can see, there are a range of possible points of connection with the customer and the way in which the customer buys depends on their level of knowledge of the possible solutions and their prior experience. The higher their level of prior purchase satisfaction, the more likely they are to buy the same product or service again and move to a habitual purchase decision process.
Tom McKaskill is a successful global serial entrepreneur, educator and author who is a world acknowledged authority on exit strategies and the former Richard Pratt Professor of Entrepreneurship, Australian Graduate School of Entrepreneurship, Swinburne University of Technology, Melbourne, Australia. A series of free eBooks for entrepreneurs and angel and VC investors can be found at his site here.
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
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