Section 1: Customers
“Goals … Customers – Case Study … Market Research”
Summaries
- 1: Customers > Customers - Case Study > Video: Lamborghini Dealership
- 1: Customers > Customers - Case Study > Video: Lamborghini Continued
- 1: Customers > Market Research > Video: Research Methods
1: Customers > Customers – Case Study > Video: Lamborghini Dealership
- We’ll start by doing a case study from Bill Aulet, the managing director of the Martin Trust Center for MIT Entrepreneurship.
- He decided that, after that, he wanted to start his own business.
- Then he realized, boy, there’s no Lamborghini dealership in Boston.
- He built this business to provide the total experience to his customers.
- Finally, at 10:35, Laura walks through the door- Laura, who he hasn’t seen since he was at MIT.
- Laura says, Erdin, it’s so lovely to see you.
- Now, I you make a high profit on Lamborghinis, and I’m willing to pay you that.
- I don’t have a Lamborghini- at which time, Erdin looks out the window and sees that she’s driving a four-year-old Volvo, and in the back there’s two car seats.
- I have to make the same gross margin I make with Lamborghinis.
- I’ve got two people in the back that aren’t doing anything.
- I could start to become a member of this community.
- Erdin’s wondering, should he take the business? So now I would like you to play the role of Erdin.
- Would you take Laura’s business, yes or no? Go back to start of transcript.
1: Customers > Customers – Case Study > Video: Lamborghini Continued
- I know this could be a bit confusing, and at one point we see people, yes, I take the business, no, I wouldn’t take the business.
- When I asked them why, what framework they think about it, there’s no solid framework.
- What we want to do here in this class is give you a very solid framework to analyze critically important decisions in your business.
- Erdin’s business plan targeted a group in Boston that was undeserved.
- Giovanni is in his 40s. Giovanni makes a tremendous amount of money because a Lamborghini will cost you $300,000 to start, and then there’s a whole bunch of ancillary things.
- What Giovanni is buying here, and we could go through the clothes he wears, the clubs he belongs to, the websites, the magazines he reads the movies- the clothes he wears, the cologne, the aftershave.
- At the end of the day, what Giovanni is buying is not a car.
- She’s thinking about how do I pay for college? How do I keep our home in this expensive, exclusive area? Where does she spend her time on Saturday nights? She spends it at Chuck E. Cheese’s.
- There will be some outlying people that buy Lamborghinis.
- There’s a whole bunch of people in here or hedge fund managers working the financial sector, partners at law firms, accounting firms, and this sweet spot is where we’re going.
- She represents the wife that divorced Giovanni because he was so dedicated to succeeding.
- So when he sees Laura’s Volvo there- when he sees Laura, he’s likely not to come back to Erdin’s shop.
- Let me build it a little further is that to attract Giovanni.
- He had to go out and buy a $25,000 coffee maker, which made sense because he could make hundreds of thousands of dollars off Giovanni.
- Now that doesn’t mean that you couldn’t make a proper business with Laura, but it means you have to have a lower cost structure.
- So in the end, Erdin had a lot of urge to take that business.
- He should not take that business if he’s going to be disciplined.
- He has to focus and find out how does he get Giovanni into his business, how does he make him very, very happy, and not take the short term fix of Laura because that will destroy him in the long term.
1: Customers > Market Research > Video: Research Methods
- Now that you better understand why starting with and focusing on the customer is important, we’ll cover how to assess their needs.
- Through interviews or observations, you’ll be able to get firsthand accounts of real needs or frustrations.
- The steps to conducting your interviews will be- first, figure out who you want to interview and how you’ll find them.
- This could be anything from talking to your classmates about an after school club or going out on the street to talk to shoppers after a purchase.
- Write an interview guide of the questions that you can ask that will challenge or affirm assumptions you have about your users or their needs.
- Go out and do it, lots of them, at least four or five for three different groups of customers that you think have the need you’re addressing.
- When interviewing, avoid just asking if they’d like your idea or like your product.
