As a business owner, have you ever found yourself identifying “pretty much everyone” as your ideal customers? Have you noticed that when trying to determine your target, you only pay attention to the clients you think you can attract instead of the ones you really want? It’s unfortunate, but this is actually the most common approach that businesses use to identify their target. However, just because someone might have a need for what you sell doesn’t mean they are the right fit for your business. When a client does not truly understand your value, they cannot be the right fit. From this, clashes in expectations and delivery arise, making it a very unhealthy relationship.
When building your marketing strategy, it is so important to narrowly define your ideal clients (for each of your products or services). Instead of simply asking who you can attract, what if you started asking– whom do we deserve to work with? Once you have established your ideal target, you will start to see more successful business transactions occur. You will no longer be spending too much time and energy on those that bring little to no return; and you will be able to focus more on the ones that matter.
At first, this whole process can be quite daunting. So to help, we bring you 5 steps that will guide you in discovering your ideal target customer:
1) Start with the Smallest Market Possible – This may feel counterintuitive to many just starting a business, but you have to find a group of customers that think what you have to offer is special. When you’re just getting started you may have very little to offer and in many cases very few resources with which to make sufficient noise in a market for generic solutions.
Your key is to find a very narrow group, with very specific demographics or a very specific problem or need and create raving fans out of this group. You can always expand your reach after you gain traction, but you can also become a big player in this smaller market as you grow.
2) Create an Initial Value Hypothesis – In the first step, we mention the idea of finding a narrow group that finds what you have to offer special. Of course, this implies that you do indeed have something to offer that is special.
You must create a “why us” value proposition – your secret weapon in attracting the best type of customers, those that understand your value. To stay true to this proposition, you must always stay in test and refine mode too.
Many people get caught up in trying to execute their business plan when the fact of the matter is the market doesn’t care about your business plan. The only thing that matters is what you discover and apply out there in the lab beyond your office.
3) Learn First from Test Sessions – Established, thriving businesses have the ability to learn a great deal every day from customer interaction. Since start-ups don’t have any customer interaction they have to create ways to test their theories initially.
The key to both making and affirming your initial assumptions is to set-up test sessions with prospects that might easily fit into your initial smallest market group. These are basically staged one on one meetings.
Another possible option is to offer free sample products to those willing to provide you with feedback.
The main idea is that you start talking to prospects about what they need, what they think, what works, what doesn’t and what don’t have now. This is how you evolve your business, your features and your assumptions based on serving a narrowly defined target.
4) Draw an Ideal Customer Sketch – Once you’ve tested your process with your narrow group, you’ve got to go to work on discovering and defining everything you can about your ideal target group.
Some of this information will be easy to illustrate, such as demographics, but much of it will be discovered in your test sessions and though some additional research in more behavioral oriented places such as social media. This is a great time to start your CRM thinking by building custom profiles that include much richer information than most people capture.
5) Add Strategy Model Components – the final step is to apply this new ideal customer approach to other elements of your strategy.
When you discover your initial ideal client it should impact the way you build your overall business strategy. All great business models are customer focused and now that you have a picture of this customer it’s time to consider how this affects the other aspects of your business.
Consider now how this discovery might impact your offerings, your revenue streams, distribution channels and even pricing. Consider how you can reach this market, who you can partner with and what resources you either have or need to have in order to make an impact in this market.
Just a heads up too, you’ll find in the process that working to attract and serve your ideal target is a never-ending story. As your business evolves, as you learn and grow, this model will evolve as well, but the consistency in this journey is also as important as what you learn from it.