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BILL AULET: So now that we
understand at a high level what

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market segmentation is, the
question now is, how do you

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do market segmentation?

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And this is actually quite a fun
process if you do it correctly.

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If you already have a
technology and people

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are buying it and
experiencing it,

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you can actually just
go to them and say,

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what are you using it for?

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And that will start
to give you input.

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If you have an idea, it's
not as easy to do that.

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But really what we're
going to do here

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is we're not going
to be limited just

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by what's already being done.

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We're going to get
the team together.

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And we're going to
think out of the box.

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What are all the different
potential things?

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And no idea is too crazy.

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Brainstorming is
a very good thing.

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The crazier idea, the better
because it opens the aperture.

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And so then, you're going to
systematically make a list

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or lay out all the
different opportunities

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that you can think of.

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And it's interesting
because in my company,

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some of the first
ones that we thought

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were so obvious-- we're going
to do this-- ends up being ones

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that we didn't do.

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It with some other idea they
came up in brainstorming.

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But once we laid out what the
different opportunities are,

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now that was just
brainstorming in a room.

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They might not be good ideas.

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We have to go out.

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And the answer lies in doing
primary customer research.

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So we're going to go out
and talk to real customers

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to find out what
their problems are,

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what they think of this idea.

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It's not-- we have to
understand their needs as well.

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Because they're not going
to be able to design

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the product for us.

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So doing primary observational
market research is fundamental.

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My thesis at MIT was on this.

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And what I saw was that you
have to have a good process.

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But it's not just the
process that matters.

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It's actually walking
in the customer's shoes

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and using good
inquiry techniques,

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not advocating for your
product but understanding

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what they're about.

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You need to walk in
the customer's shoes.

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You need to understand
them rationally, of course,

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emotionally, and also socially.

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What drives them?

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What do they kind of
fear most in the world?

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But now, we're going to
understand their job as well

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by watching them.

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And this is what we call
primary customer research.

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Then, we're going to
narrow down these markets.

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So we might have 20.

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And we're going to do a first
pass on market research.

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And then, we're going to say,
all right, we can't do 20.

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We can only do six
to eight of them.

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And then, once we do that,
we've narrowed the field.

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And then, we do another push of
market research, primary market

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research to do this.

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Do not trust what you
just see on the internet.

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Do not trust a
report from a group,

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as reputable was
Gartner might be.

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Go out, and see for yourself.

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Because the answer
lies with the customer.

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You have to do this yourself.

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Don't download
your eyes and ears.

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This primary market
research is one

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of the most fundamental
important things

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that you're going to do.