Is Your Company and the Market Misaligned?

By Rob Meissner, TCV Growth Partner-

In today's rapidly evolving business landscape, market alignment is more than just a buzzword, it's a necessity for survival and growth.  Yet, many companies find themselves misaligned with their target market, often without even realizing it.  If your products, services, or messaging no longer resonate with your audience, it may be time to assess whether your company and the market are truly in sync.

What Does Market Misalignment Look Like?

Market misalignment occurs when a company's offerings, values, or strategies do not match the needs, preferences, or expectations of its target customers.  This disconnect can manifest in several ways, such as stagnant sales, declining market share, negative customer feedback, or difficulty differentiating from competitors.  Recognizing these signals is the first step toward addressing the problem.

Common Causes of Misalignment

• Outdated Products or Services: The market's needs may have evolved while your offerings have remained the same, making them less relevant or appealing.

• Poor Understanding of Customer Needs: Failing to keep up with customer trends, preferences, or pain points can lead your company down the wrong path. You may have understood the needs of the early adopters but failed to clearly identify the needs of the broader market that you are trying to appeal to.

• Inflexible Business Models: Rigid processes, pricing, or channels can limit your ability to adapt to market shifts.

• Ineffective Communication: If your messaging doesn’t resonate or is inconsistent with your audience’s values, you risk losing their trust and interest.

How to Identify Misalignment

To diagnose a misalignment, start by listening to your customers and potential customers.  Ask them about their challenges, their pain points.  Ask them what keeps them up at night.  What did you hear from your customers that was different than what you heard in the past?   Review your complaints.  Are you receiving more complaints or seeing lower engagement?  Analyze sales data for trends and compare them with industry benchmarks.  Conduct market research to understand what your competitors are doing differently and gather feedback through surveys, interviews, or focus groups. Sometimes, the signs are subtle—a dip in customer referrals or a rise in negative online reviews—but they are critical to notice early.

Steps to Realign With Your Market

1. Revisit Your Value Proposition: Ensure that your products or services solve real problems for your customers and provide clear benefits.

2. Engage With Your Audience: Build ongoing relationships through social media, customer support, and community engagement to keep your finger on the pulse of their needs.

3. Foster Agility: Be willing to pivot your strategies, update your offerings, or explore new business models in response to market data.

4. Invest in Market Research: Regularly gather and analyze data about your market, competitors, and consumer trends to stay ahead.

5. Align Internal Culture: Make sure your teams understand and embrace your company’s mission, vision, and commitment to serving your customers.

A Case Study

Recently, I worked with a restaurant that opened during Covid.  They had structured their operations to focus on carryout and delivery to address the needs of their customers at that time for more social distancing, etc.  Initially, their sales took off, customers loved their unique menu and friendly staff.  After a while, however, their sales stalled.  Their initial response was to attribute their flattening sales to the overall economic conditions in the area.  There was an element of truth to that.  They also questioned whether their social media marketing manager was being effective.  Again, there was some truth to their concerns.

Before taking action, though, I encouraged them to undertake an intentional, structured process of talking to their customers.  What drew them to come that day?  Where were they from?  How did they hear about the restaurant?  What was their experience like?  What other options did they consider?  One of the biggest Ah Ha’s was that, because of their unique menu, they had many customers who came from some distance.  While those customers loved the food, they were not expecting and were frustrated by the fact that the restaurant offered take-out only.  While it may sound obvious, but the needs of their customers during COVID were not the same post-COVID.

They were able to re-configure a small area as an experiment to provide a dine-in option.  Sales grew pretty quickly by approximately 10%.  Armed with this data, they embarked on a much more substantial remodel of the store. 

Conclusion

Market misalignment is not uncommon, but it can be a silent business killer if left unaddressed. By proactively seeking feedback, analyzing trends, and staying adaptable, your company can realign with the market and set itself up for long-term success.  Remember, the most successful organizations are those that evolve alongside their customers and view alignment as an ongoing process rather than a one-time achievement. For assistance in assessing market alignment and remediation, feel free to reach out to Rob@TCV-Growth.Partners