This article flows from a bigger series on how to start a delivery service or courier business. We here at Upper Route Planner offer a route planning application. We want to serve our users by creating a guide to help you start a delivery business overall, whether it is a sole proprietorship, partnership, or limited liability company. This is why we’ve created this guide.
This article will look at the importance of customer discovery and how it can help you run a successful package delivery business. This article from a longer series of articles talks about starting your own business (delivery service or courier business). Let’s dive in!
For more information relating to starting a business, you can check out our blog about the steps on getting started.
Table of Contents
What is Customer Discovery?
The customer discovery process is getting to know your customer, their problems/needs, and how a solution can best solve their problem. This is achieved by having clear conversations, asking unique “discovery” and “validation” questions. Good discovery must define the questions and answers you are looking to get from the process.
As mentioned, this is part of a broader series on starting your own delivery business.
Why is Customer Discovery Important?
The Foundation – Create a Profitable Service Business
First things first: Why it’s important is that you want to build a successful business that makes you money and lets you be your own boss.
And how do you do that?
You build a successful package delivery business by creating a loyal, happy customer base.
And how do you do that?
You provide the appropriate solution to a specific consumer base. In other words, you provide the delivery service that is appropriate to the community you’re serving. This can be done by launching a delivery business that can offer delivery service solutions. Several independent contractors do this by being a part of the Amazon delivery service partner program. Many individual drivers and contractors choose to be Amazon delivery service partners. So it’s a win-win for individuals as well as the corporation. This way, the corporation can start a delivery service with low startup costs without worrying about operational charges, vehicles, vehicle maintenance, and other useful tools.
Let’s break down those two elements. First, the “Appropriate Solution,” and second is the “specific consumer base.”
What is an appropriate solution?
The first half of the answer above is the “appropriate” solution. In other words, this means the “Right solution” or the one that meets the requirements of new customers. You can think, for example, of courier services that provide local deliveries for a specific user with specific requirements, like flower shops or food delivery that can use their services on demand. Of course, some of the base requirements needed to meet the customers’ needs with urgency and expediency.
A great example is Uber, which created a new business with a business plan that disrupted the existing taxi industry. They used the high-demand opportunity left by traditional small businesses to create a faster, more convenient user experience. Uber leveraged new equipment and tech (smartphones), solved the logistics problems that created a better choice for many users and turned an average car into a delivery vehicle ( like a cargo van, pickup truck, box truck, hand-truck) and hired independent contractors or delivery drivers to serve a pressing need for transportation for commercial purposes. In short, customers get faster delivery services for a lesser cost. It also did the same thing with Uber Eats. Even though Uber Eats is more like an extension to Uber’s existing services, you can say that it disrupted the food delivery company.
The same applies to companies offering couriers and mail services like FedEx and UPS. They developed a reliable delivery partnering solution for businesses and individuals who could not deliver couriers independently. They grasped the opportunity of getting packages delivered. When you hire independent contractors, you provide them with delivery tasks and delivery routes without worrying about the vehicles (pickup trucks or bikes) and other assets and operational costs. This system can work for all kinds of industries, whether you deliver food, furniture, courier, or other important articles.
This is an example of an appropriate solution. Having such a solution inevitably leads to repeat customers and clients, and things go a lot easier for you.
Now, what’s missing is the other part of the equation – the specific target market. Let’s look into that side of the equation.
What is a specific target market?
A specific target market is a group of customers that a small business or delivery service can meet. This is a very tricky step in the process. It requires businesses and business owners to take a step back, get user data to support, understand the business structure and the customers they are serving.
What’s important here is that you define who you are serving and who you are NOT serving. For instance, you may want to be a small delivery service business and only service small delivery services. Or on the other hand, maybe you do not want to target many businesses at once and only service their logistics in your deliveries. This can also be achieved by being Amazon’s Delivery Service Partners.
Amazon’s delivery program aims to support owner-operators by funding startup costs and allow individuals to own businesses of their own and make them hands-on leaders. This is a great way of supporting a qualified candidate in being an entrepreneur, creating more jobs, providing hands-on training, coaching great teams, and making sure operations run smoothly. In addition to this, they get access to Amazon’s technology and logistics experience.
The key thing here is: there is no right or wrong answer. The important thing is that you talk to customers, that you get to understand what the need of each user is, and to segment these users into different groups. As a business owner, when you know who you are serving, you can then craft a delivery service or courier service appropriate to those clients.
Why do I Need a Specific Target Market?
In short, knowing the specific target market will drastically improve the quality of your products, own delivery business, or delivery service. It will give you a big head start on how to a) find these clients, b) talk or market to them, c) Get them to use your delivery business. This is precisely why it’s critical in this type of business (or any business) to start and to continue making customer discovery. Specific examples of target markets would be Mobile Pet Grooming or a lawn maintenance service.
Plan quickly, deliver faster, delight customers and get home early.
Everyone deserves to have simple and easy route planning.
What are the Benefits of Good Customer Discovery?
We’ve made the case above for making customer discovery. Here is a bullet point list of benefits that really allow you as the future boss of a delivery business to know how it will benefit you.
- Save Time: With a better knowledge of your users, your business will benefit from creating a scope on where the deliveries will take place (delivery boundaries). It is a great advantage for entrepreneurs to know the size of the market they provide doorstep services to. A driver will not have to face.
- Save Money: If you know your target audience, you can quickly reach out to them, make lots of deliveries, and make those deliveries in less time. This all results in improved efficiency and output for your business entity and keeps your business growing. This means more profit to the bottom line. Businesses will generate more income/revenue, but they will also be able to save money on fuel.
- Improved Client Knowledge: As a business owner, knowing the client’s needs will help you see your specific target market’s demand. This means it’s easier to find them, communicate with them, and sell to them. Marketing to the expectations of a well-defined audience is the best way to ensure growth. This will also help you in coming up with suitable ads about the items you are selling. Finding out the advertising methods that suit your business is important.
- Quicker Sales times: Your business will be able to sell quickly to your clients. To be able to make quicker sales, it is recommended that you specifically understand each buyer persona. You will only end up having more customers to deliver per hour.
- More Efficient Business: Having a focused set of needs for your client base allows your business to limit your delivery service business’s scope: for instance, are you doing only errands? Do you have one vehicle and driver? Or do you need a larger fleet? This knowledge can make you leaner; for instance, it can help you start with just one vehicle (like pickup trucks) and maybe start working out of your home.
- More clarity: When you know who you are serving, you have more clarity. This can help with things like getting a business name, business license, startup fees, etc.
- Fewer Equipment Costs: With more focus and clarity, you will better your need for equipment; for example, what fuel-efficient vehicles do you need? What type of cell phone? What other equipment do you need? Can I work out of my home? Can I use my own car to start errand service? Do I need liability insurance or cargo insurance? This allows every delivery business to reduce startup costs and launch operations quicker. A lot of these decisions will also depend on whether you have a sole proprietorship or limited liability company. There are other things involved like state permits, fuel costs, and possibly liability insurance.
7 Steps to Customer Discovery Success
Below is the blueprint for a successful customer discovery process. Follow this, and you will have the foundation for a successful delivery business.
Step 1- Be Humble and Assume Nothing
The first step is to assume nothing. I don’t know my customer; I don’t know the industry.
The goal here is to have an open mind and go in with the goal of learning. Think of a young child: they are open to learning EVERYTHING. This is who you can initiate in this process. Imagine for a second if a young child thought they knew how to talk before they actually knew any words. Imagine for an instant if they were arrogant and said, “no thanks, I don’t need your help or anyone’s help on how to speak.” This is ludicrous, of course.
Young children have little to no ego when learning; the same is useful for us as adults.
Step 2 – Be a Scientist or Detective
With your new attitude in gear, now it’s time to get to business: the data business.
The key outcome is to get information on the users and find any information source that will help you in your delivery business. In short, you want to use the scientific method:
- Define a question to explore (These types of users seem to have this problem)
- Create a hypothesis about how to solve this problem
- Gather information and do observations – See what is happening objectively (not what you THINK or FEEL is happening)
- Review the Information and validate or invalidate the hypothesis
In short, be prepared to collect data and be a scientist!
Step 3 – Create a Customer Persona (Customer Avatar)
The next step is to create an example of a “typical user you will serve.” There are many examples online of good resources on how to do this, including this one from Digital Marketer. This can also help you when you design your website to publish content. It might add to your marketing expenses, but it will definitely pay off. It can also help you repurpose your social media platforms. For our purposes, we suggest you define:
- Who your customer avatar is (how old are they? what is their name? their job?) or different types of customers
- What are their goals and desires?
- What are their challenges and pain points at the time you deliver packages? e.g., what do they want to do better?
- Are they looking for a new solution? What does that solution look like?
- How much are they willing to pay for this solution?
The next steps will have you work on detail on these buyer personas.
Step 4 – Define a Hypothesis
Now it’s time to define a hypothesis. Work from the Customer persona to create a hypothesis, using this format:
My user’s job is (insert job or role here), their challenge is (insert challenge here), they want the following change ( (insert change here), by doing (insert solution here).
Each of the “insert here” is the assumption you will make. These assumptions will be challenged relentlessly in your customer discovery process.
Step 5 – Create a List of Customer Discovery Questions
If we continue from step 4, there is a list of important questions to ask your users. They are broken down into 4 sections:
User Discovery Questions:
- Who is the user?
- How old are they?
- How big is their company?
- Are they employees or in charge?
Problem Situation Questions:
- What are the requirements for their job?
- How are they currently getting the work done?
- What’s the hardest part of this process?
- What is challenging?
- How much time is it taking?
Solution Discovery Questions:
- What is your ideal solution?
- If someone could do this, would you like that?
- How much would you pay for this solution?
Step 6 – Ask these questions to potential customers.
Talk to People. Plain and simple.
Call them, show up at their workplace, give out business cards, work your network.
By any means, go and find those people and ask them these questions. And write down your answers. These questions will also help you develop on-demand support to make your operations run smoothly.
Also, let them know this is a discovery, and don’t try to sell them. Selling and discovery are 2 different processes of the logistics experience.
Step 7 – Analyze, Rinse, and Repeat
From there, you can analyze all the essential information you’ve collected. With this new information, you can update your idea and assumptions and create new avatars and business cards, which will allow you to better your business, your service offering, create a better logistics experience and help you become a more successful company. Once you start this process, you will definitely be able to develop marketing strategies that work for your business processes, like a loyalty program and other plans of action.
Get Started with your Customer Discovery
So there you have it! We hope we have been able to provide useful information. We here at Upper Route Planner are dedicated to the success of your delivery or service business. If there’s anything else we can help with, please let us know!