Defining the Target Audience of an Open Source Software Company

Without understanding the target audience, Open Source businesses will not be able to effectively communicate with those who are supposed to buy their products, support, services and contribute to software development.

Ideally, the target audience has been defined in the corporate marketing strategy. Although this might seem obvious, most of the Open Source companies we work with at InitMarketing have a rather vague idea about whom they want to talk and sell to. The following reasons are typical:

  • Open Source start ups have usually only broadly defined a go-to-market strategy and target audience in their business plan, which is good enough for their VCs who are rather interested in the grand picture which allows them to assess the business potential.
  • Those Open Source companies who have in the past years organically grown their business from a one or two man show of developers to 10-30 staff members have always somehow made money with their product. They intuitively understand their target audience, but never reflected upon it to expand their business more quickly with a focused marketing strategy.
  • Even large to super-large corporations who are in the Open Source business much too often lack a good understanding of their target audience. The reason being that business decisions of top management (such as “let’s start to port our software to Linux”) are being executed with poor strategic guidelines.

The Branding and Positioning page in my Wiki provides some ideas how to address the needs of your target audience – but how to understand them? Will you have to pay expensive market analysis programs? No, you don’t, because informed intuition comes to the rescue plus the fact that Open Source allows for incremental marketing.

Geoffrey A. Moore defines informed intuition in his classic marketing book Crossing the Chasm:

The key is to understand how intuition – specifically, informed intuition – actually works. Unlike numerical analysis, it does not rely on processing a statistically significant sample of data in order to achieve a given level of confidence. Rather, it involves conclusions based on isolating a few high-quality images – really, data fragments – that it takes to be archetypes of a broader and more complex reality. […] so in marketing can whole target-customer populations become imagined as teenyboppers, yuppies, pickups and gun racks. These are all just images – stand-ins for a greater reality – picked out from a much larger set of candidate images on the grounds that they really “click” with the sum total of an informed person’s experience.

In his book, Moore further describes how to define sample scenarios that allow to understand the user, technical buyer and economic buyer. In essence, the definition of a target audience should be able to answer this little question: Why does your product matter?

Given that many of today’s successful Open Source businesses are alternatives to closed source competitors (e.g. Linux vs. Microsoft, MySQL vs. Oracle), it is quite easy for them to imagine their target audience. Such Open Source products are being used by developers, hence it is mostly developers developing for developers. To define a target audience, such companies basically just need to look at themselves.

The higher Open Source moves up the stack, the more important it becomes for Open Source software vendors and their partner companies to focus on end user needs, a target audience very different from how software programmers think. One example would be SugarCRM who successfully communicate to sales and marketing personnel across various industries.

Due to the Open Source development mantra release early, release often, companies can adjust their understanding of the target audience gradually at minimum risk, but only if they also follow the mantra of incremental marketing: communicate often, communicate early. They will automagically learn to understand their target audience as long as they make sure that they allow for interactive external communication for example through an online forum on their website and establish good internal communication within their organization between the development, marketing and sales teams.

The combination of informed intuition and incremental marketing forms a general business advantage for Open Source companies, because it allows them to minimize the risk of being guided by prejudices when it comes to understanding the target audience.

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