Warning: you’re losing money by not defining your ideal customer

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Struggling to attract the customers you want to work with? Defining your ideal customer isn’t simply a paper exercise, it’s the key to successful marketing for those running service-based businesses.

As a service-based business you never quite know who is going to walk through your door, literally or figuratively.

Some customers love what you do, don’t quibble with your price and repeatedly recommend you. Others don’t always appreciate your work and question your worth.

Have you ever felt that you’d like to work solely with customers who really value what you do?

Running a successful service-based business is continued effort, and very rewarding when customers appreciate what you do, especially when you feel you are making a difference. But it’s quite the opposite when you’re coping with customers who don’t value your efforts and talents.

Well, there’s good news: there’s a way to help ensure you’re no longer compelled to work with customers who don’t truly value what you do – and you can make more money this way than by accepting work from anyone who asks.

Using the right approach, step-by-step, you can focus and attract the customers you want to work with and here’s the good bit – they will be more important for you because these customers will value what you do and won’t be so focused on price.

Ideal customer: rarer than hen’s teeth!

Ah! I hear you cry: my ideal customer is rarer than hen’s teeth, I have to take work where I can find it.

I understand, not everyone you work with will be the perfect customer, however, if you follow these steps you have a greater chance of attracting those that you really want to work with and who appreciate what you can do for them.

So as a start, let’s define, and I mean really define, who you want to work with – your Ideal Customer. You may be surprised at how the process of describing your ideal customer focuses the mind and concentrates your efforts.

When you’ve finished reading this, you’ll know exactly how to define customers which are well matched to you and your service-based business.

Ready? Let’s start.

Determining the ideal customer for your service-based business

There are three key steps to determining your ideal customer.

1.           Identify the characteristics of your existing most valuable customers.

2.           Define the problem that you are attempting to solve.

3.           Write a clear and detailed description of your ideal customers by visualising real people.

What are the characteristics of the existing most valuable customers that you like to work with?

Establish value (cross-referenced with referrals) and what’s good for you

Before you start diving into the search for your ideal customer out in the marketplace let’s identify the characteristics of your existing most valuable customers, especially those who are your “raving fans”. (A raving fan is essentially a customer who is so impressed by your service they repeatedly refer you. (Ken Blanchard & Sheldon Bowles).

(I’ve used the word value here deliberately, this is a whole topic on its own but essentially identify your most valuable customers in the best way that makes sense for your business, for example by profitability, average spend, frequency, or even influence.)

Have a look at your customer list from the last 2 or 3 years and note which services, and the value of the services, they purchased from you. Then rank customers from high to low and cross reference with those customers that have given you excellent reviews and referrals.

Who do you enjoy working with?

Now here’s the clever part. In addition to the empirical data of service spend, frequency etc. make a note of those customers that you enjoy working with and why. You may have had a fun experience with those customers, they may share the same values or pastimes with you, or they may simply give you peace of mind through paying your bills on time, every time. Whatever it is for you, identify these emotional aspects that resonate with you. It’s likely that these customers share similar values to you.

Similar characteristics

Now see if you can identify specific similar characteristics associated with those high value, high referring, high enjoyment customers.

There may be demographics such as age, gender, education, marital status which are common but be careful with these broad attributes when identifying your ideal customer, on their own they can simply be too broad for this approach.

For example, when researching marketing to the over 50s recently, I came across a survey on over-50s advertising from Gransnet and Mumsnet. Their research found that only 12% of respondents believe agencies understand the 50+ age group and 85% believe that ads aimed at older people rely on stereotypes. This age group are looking for “personalised and relevant content – regardless of age.” (e-consultancy.com)

For B2B customers there may be broad similarities such as business turnover, number of employees, sector, job title, but again you are seeking to identify the characteristics of real people and their specific issues within these organisations.

Behaviours

Once you have a broad focus on your ideal customers you can start to understand their particular behaviour and motivation.

Similar to the Stanislavski acting method you can go some way to understanding your character’s “offstage” life to better understand their “onstage” performance!

In other words.

For B2C customers you may explore;

What do they do? Where do they go? What do they enjoy? Where are they active? Where do they go for information? Where are they located? What is their decision-making process?

For B2B customers look at;

Which sector is the business serving? Where are they located? Which publications, blogs, websites, directories, events and trade shows are they interested in? What kinds of social media do they use? How would you describe the company culture and values? How have they been affected by changes in the economy or marketplace? How do they buy?

What is the problem you are solving and how do you help?

Once you have established the value, characteristics and behaviours of your existing customers have a look at the problems they face that you solve.

Express the problem the customer (for B2B customers the particular job title) would like to solve in a negative statement and list out the reasons for this problem (which match the elements of your solution) and the broader implications.

Then define what they want to accomplish by buying from you in a positive statement. What is the key reason they would buy from you? Now have a look at why they wouldn’t buy from you. What would prevent them?

Establish a clear and detailed description of your ideal customers

Write a clear description of your ideal customer which includes the elements described above.

  • Description: name, gender, education, characteristics, behaviours, values
  • Goals
  • Problem, reasons for the problem and implications
  • how they buy
  • how you help
  • how you communicate
  • your messaging and content

Last, but certainly not least, it’s likely that you’ll have more than one type of ideal customer so write detailed profiles for each of them. Then, you can focus in attracting the customers you want to work who will value what you do – and be happy to pay accordingly.

Want to create your own Ideal Customer profile? Download your Ideal Customer Profile Template or contact me.

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