How to segment your customers

Customer segmentation is the practice of dividing your customers into groups or units of individuals that are similar in specific ways relevant to marketing, such as age, gender, interests and spending habits.

To introduce customer segmentation into your business, you should operate under the fact that every customer is different and that their demand for your product or service would be better served if you target specific, smaller groups with messages that those particular customers would find relevant and lead them to buying something.

Customer segmentation relies on identifying those key differences that divide customers into groups that can be targeted. Information can be professionally sorted into groups such as:

Customers' demographics (age, race, religion, gender, family size, ethnicity, income, education level), there are many common segments within the clothing industry, for example—including men and women, fashionable, thrifty, conservative, casual, and business.

 Geography (where they live and work),

Psychographic (social class, lifestyle and personality characteristics) For example, musician customers can be segmented into commercial, retail, drums, live sound, guitars, professional, beginner, collector, live sound, or recording,

Behavioral (spending, consumption, usage and desired benefits).

If is such tendencies are taken into account when determining customer segmentation practices.
Customer segmentation can have a great effect on business management in that, by dividing customers into different groups that share similar needs, the company can market to each group differently and focus on what each kind of customer needs at any given moment. Large or small, niche customer segments can be targeted depending on your businesses' resources or needs.

Customer segmentation will bring the following opportunities:

• To create and communicate targeted marketing messages that will reach out to specific groups of customers, but not with others (who will also receive messages tailored to their needs and interests, instead).
• Select the best communication channel, which might be email, social media posts, radio advertising, or another approach, depending.
• Identify ways to improve products or new product or service opportunities.
• Establish better customer relationships.
• Test different prices.
• Focus on the most profitable customers.
• Improve customer service.

Customer segmentation can be practiced by all businesses regardless of size or industry and whether they sell online or in person. It begins with gathering and analyzing data and ends with acting on the information gathered in a way that is appropriate and effective. It brings hope to gain a deeper understanding of your customers' preferences and needs with the idea of discovering what each individual or group finds most valuable to more accurately tailor products for them.

By Sheba Joy

Intern

Kyusa

SELL THE VALUE, NOT THE PRODUCT

Many people dive head fast into business and we want to sell, sell, sell and get the money, money, money. And so we forget the processes that are within when it comes doing business. One of which is Value Proposition. This is the promise of value to be delivered; the reason people should buy from you.

Take for example on a cold Monday morning, if a lady selling porridge walked in to your office and said, “Good morning. I am selling porridge. Big cup 1500 shs, small cup 1000 shs,” and another lady selling food warmers walked in and started by greeting you, then engaging you in a short conversation that went a little something like this;

Lady: “Good Morning sir/madam.”

You: “Good Morning.”

Lady: “Sorry about the weather. It has been very cold these past few days.”

You: “I know.”

Lady: “And you know food tends to cool very fast.”

You: You start to think about how you don’t like cold food

Lady: “I have some food warmers here with me…”

Now I am almost positive that although lunchtime is hours away, you will be more convinced to buy the food warmers, and not the cheaper hot porridge that will probably solve your problem now.

After you have identified the target market (the potential customers), insight is key when coming up with a value proposition. You must identify the target’s biggest most unmet need and then decide to give them benefit by focusing on providing the solution. Do not have multiple benefits. Have just one that will solve the most pressing, most significant problem to the target market and by doing so, your value proposition increases.

Look out for the alternatives in the market i.e. the other places that the customers would most likely turn to solve their problem. Find out who directly or indirectly already delivers against that problem? And then go further to find out what they leave out and how you can address that.

Last but not least, offer your unique selling point i.e. “We can deliver benefit to the highest degree of superiority over everything else that exists in the market, therefore you should come to us.”

If your value proposition makes people go “hmph?”, you’re doing it wrong. Yes, sufficient information and selling the product is crucial for business, but you need to draw them in with a clear, compelling value proposition first.

By Rebecca Nabejja
Intern
Kyusa

Beating Competition

“Gundi is doing it better so why bother?”

This is sadly the reason why many of us don’t want to start doing things. Because we think the other person is doing it well or even way better than we ever could. Many of us fear to venture into business because we are afraid of the competition. We are so quick to think about the negative outcomes and leave out the positive even before even we start.

Well let me interest you for a minute…

Riham Cola, a carbonated soft drink bottled locally by Hariss International Limited, was introduced to the Ugandan market in February 2013. Most of us wondered how it would battle against Coca Cola or Pepsi products. But lo and behold! Century Bottling Company is said to have cut prices for most of her products by almost 70% in response to a new and aggressive rival in December 2013.

While Coca Cola and Pepsi increased the prices of their sodas, especially the Kamini which was brought to counter Riham Cola as a strategy, Riham Cola chose to instead reduce the quantity of their 350ml to 320ml and kept the price at 1000 shillings. Coca Cola had its Kamini price at 1200 shillings and has recently increased to 1500 shillings.

The average Ugandan would obviously want to save the 500 shillings if they had the chance to. In a price sensitive market, 200/500 shillings means a lot and the customers can reject the brand faster than you can blink your eye. Riham Cola went further and targeted the untapped market in the villages and by doing this, its market shares rose by 5%.

So maybe you thought of something that probably already exists. Truth is, there is nothing new under the sun.  That should not stop you from doing it, and doing it in a better way. Realise what makes your product different from the rest. Find that gap and exploit it. It is up to you to make a difference; to be better.

No matter how competitive the market, you can still succeed. Competition should not scare you. It should motivate you.

By Rebecca Nabejja

Intern 

Kyusa

Bookkeeping as a new tradition

Bookkeeping mainly refers to keeping of accounts and all the information regarding the transactions and financial activities of a business. Bookkeeping basically keeps track of the performance of ones business. It should be a major practice to not only organize a business’ management but also prepare for the future. Record keeping  helps analyze your business’ profitability and the losses made. It can help you stay out of trouble with tax authorities, maintain positive relationships with clients and vendors and also to legally protect your business.

Certain records are key to your business and hold importance to the smooth run of your finances. For example, contracts. If your business provides a service, you should sign a contract with your client every time you begin doing business with a new person or company. If you provide a product, you may have contracts with suppliers and distributors. And if you have employees or contractors, you’ll definitely want to draw up work contracts. All this are records that would prove important to of use to your company.

As for smaller businesses and individuals, you’ll usually need to bring your own contract to the table. Before you open for business, you should create a standard contract that lays out the basic areas you want to cover in every business agreement, such as time frame, pay and job specifics. Your contract may also cover issues such as confidentiality, records, liability and ownership of work product. You will want to fashion the contract to each business agreement you create, hence making business easier for you.

The other kinds of records are client files. It’s important to keep a record of the work you’ve done and the business agreements you’ve made in case you or the other party has a question after the fact. Also, sometimes you can use past assignments and agreements to inform future ones, saving you time. Client files are also a good place to store notes about a client’s preferences or anything else unique to that client that you want to remember.

Lastly the other kinds of records are accounting and tax records. These are documents that show the expenditure and earnings of the company. If your business has complicated financial records or if you want to be able to prepare financial statements with the click of a button, business accounting software such as Quick Books can be a big help. Be warned, though, that to use business accounting software accurately and effectively requires some accounting knowledge. If you don’t know what debits, credits and journal entries are, this software may just cause you headaches. You can always keep records by hand or by spreadsheet. In many cases, spreadsheet software can serve all of your accounting needs at least while your business is small.

Therefore, record keeping can save you from loss and high credit debts and should be a new practice all Ugandans should take heed in for the betterment of their businesses.

By Sheba Joy

Kyusa Intern

2018

Steps to successfully starting a small business with little capital

Most aspiring business persons might think that to start up a small business u will still need a lot of funding. On the contrary, it is possible to start up a business without needing a lot of capital. Even then its still possible for a multi million dollar to crumble without the right foundations.

First, select the type of business that you would want and would fit in your budget. For example the most trending businesses in Uganda include salons, fast food restaurants, farming, clothes, etc really need a maximum 100,000/=. The secret to this is that you just need to identify enterprise that would cater for peoples everyday needs, hence you are guaranteed market.

Secondly, start the business plans. Plan the accounts, write lists of equipment that you need, etc. this helps to avoid unnecessary expenses and also check credit department burden in case you took a loan. This is also the stage.

Next, apply for a business license. This is to make your business your own. You must have a name for your company so that you might receive patent rights to your products. It also makes you available for the National Social Security Fund. You won’t have to worry if KCCA is shutting down unlicensed businesses but this also means you will be required to pay taxes.

Now the real hard work starts with you marketing your product so that you can get customers and profit. Open websites, advertise and tell more people about what you are doing. If employing labour is needed, make sure it is one that has high efficiency in the production of your products.

Therefore, do not sit and wait to collect a lot of capital for a big company, starting small can bring better results faster.

By Sheba Joy

The Beauty of Small and Medium Enterprises (SMEs) to the Youth of Uganda

Small business enterprise is a new development that has taken Uganda’s economy.  Its promising to be the solution to the high unemployment rates and also the financial empowerment of youth regardless of level of education.

What is an SME?  An SME is a business that employs between 5- 49 people and has the total assets between shs.10 million –  shs.100 million. These small Bs have taken up 80% of the regions employment, 90% of the entire private sector and contributing 33% of the nation’s GDP. Simply put, these business are making Ugandans less poor each day.

So what’s the beauty about SMEs? Unlike being employed under a company, you are your own boss. You can make own decisions about anything, discover and practice your own ideas, have first hand experience and contact with customers in the field, a guaranteed collateral security and a community sense of belonging and stability should you choose to hire anyone from the local economy. And lastly, No one can fire you.

Subsequently however, SMEs had not been noticed by the Ugandan youth until of late and therefore the number of limitations towards financial growth are endless and still ongoing.  For example, while 10% of Ugandans started a business last year, a fifth of them have discontinued a business in the past year. This was blamed majorly on the lack of knowledge of opportunities in foreign markets, high loan bank rates and the low growth expectation especially in the young. Another hindrance to the SME boss maybe the inconsistent income, long working hours and the fear to make investment that can lead to financial risks.

Nevertheless, the pros outweigh the cons of Small and Medium enterprises. Hence this should fuel the energy for those driven by passion and ambition for their dreams.

And the beauty about SMEs is that they could anything and everything , anywhere to everywhere, from snacks like samosas, mandazi, roasted nuts , juices to cosmetology , textile, the list is endless. All you have to do is choose what you want.

By:

Sheba Joy