Potential investors want to know who might purchase the product, why, at what price, and how many potential customers are out there. Experience strategists set out the research similar questions to understand the audience context. This information leads to an understanding of the individual people who might purchase the product, and eventually to the development of a product experience strategy.

The following diagram maps out an audience funnel that connects a company and its product to the individual consumer. The term "funnel" is in reference to the narrowing of the total market for the product down to specific audience segments.

The total market for a company's product is the largest possible cluster of people who may share common interests or needs, which are addressed by the product, or will be addressed by a new product the company plans to offer in the future. Total markets can appear to be deliciously large. For example, the audience for a product such as the Flip camcorder is potentially everyone in the world who wants to make videos. That's a lot of people and a lot of camcorders to manufacture and distribute in the hope that all will be sold.

When taking a closer look at the total market, it actually begins to shrink significantly: Not everyone in the world who wants to make video can afford to purchase the device, or care enough to actually purchase the device. There are professionals and hobbyists for whom the product's video quality is unacceptable, others may already have a camcorder, or plan to purchase a tape camcorder, and so on.

The remainder of the total market is the product's target audience, people who are attracted to the product due to the combination of its experience design, simplicity, and low cost--those who are frustrated with the complexity of the camcorder they own, others who will purchase it in addition to their camcorder, those who planned to purchase a new camcorder and like the simplicity of the product, those who will purchase the product as a gift, and so on.

Historically, the notion of targeting audiences and audience segments has gradually evolved from the advent of the industrial revolution in the mid-eighteenth century. Mass manufacturing coincided with many other emerging trends. Steam locomotives and steam freight ships made it possible to move large quantities of goods from factories to urban centers and large quantities of fresh produce from the countryside to cities, quickly and inexpensively. Proliferation of jobs in factories and services led to a raise in the disposable income for many workers in industrial countries.

For the first time in human civilization, it became possible for millions of people to spend money on products that are not essential for survival.

Fast-forward to our times, marked by a global economy, network-connected high-tech products, advanced logistics, product miniaturization, and huge markets for companies. Facebook, a social network company, has over a billion and a half users. According to http://www.internetlivestats.com/, Google executes over 1.2 trillion search queries annually, and Microsoft claims that more than 1.2 trillion users around the world use its Office product, in 107 languages.

However, reach of this magnitude is not limited to digital products and services. Many manufactures of physical products, such as Ford, Walmart, and McDonalds, established global production and distribution centers, which enable them to reach hundreds of millions of people. The latest trends in manufacturing, such as 3D printing, open up such opportunities to small companies to compete on a global scale, because printing products locally significantly cuts the cost and complexity of manufacturing and distribution.

Naturally, the larger the markets and audiences, the more robust the competition. This benefits individual users because with competition comes a wider choice of product options and price-points. Companies that are able to deliver a user experience that builds a strong emotional connection between users and their product stand a chance to dominate their market.

For example, like previous Apple products, its first generation of iMac computers was revolutionary in targeting a slice of the overall market for personal computers at the time. iMacs helped Apple greatly expand its share of that market, blending its B2B and B2C audiences--individuals, families, and users at corporations and educational institutions worldwide were mesmerized by a personal computer that was drastically different from anything else offered by its competitors.

Compared to computers that were packaged in uninspiring beige boxes, the iMac offered a set of competing experiences:

• It was shaped as an egg shell, whereas PCs of that era were shaped as rectangles.
• It came in five translucent colors, which made it possible to see its inside. Considering that computers are very visible in the home and in the office, the unique shape and choice of colors, coupled with the ability to see the computer's inner parts, made the iMac a delightful piece of home furniture to look at. Keep in mind that at the time, beige boxes wholly dominated the personal computing market.
• It delivered on the promise of true plug-and-play: get the product out of the box, connect keyboard and mouse, connect modem cord to the phone jack, plug to electricity, and start using your new computer!
  For Apple customers familiar with Macintosh computers, this and other iMac experiences further strengthened their emotional attachment to the company and its products. For new Apple customers, the elegant unboxing experience provided a powerful first impression even before turning the computer on.
• The "i" in the iMac's name further connected the emotional and intimate aspect of the person-machine relationship.