Sometimes the things that can really help your business are hiding in plain sight. While the idea of identifying your ideal customer in order to optimize your results may not seem like an obvious strategy, if you think about it, you’ll quickly see that this concept is a sure-fire way to increase profitability and boost your ROI. Here’s why:
Wanting to attract as many people as possible to your business is natural, but trying to be everything to everyone tends to dilute your efforts and, accordingly, leads to lackluster results. Sure, you may have a greater number of potential customers, but, unless they turn into enthusiastic buyers, all of those numbers don’t help you. On the other hand, if you know who your ideal customer is, you can focus your marketing to target him or her, resulting in more conversions and a better ROI.
Moreover, by narrowing your focus, you’re able to design processes, products, and services that best serve your target customers. This not only helps to build loyalty, but it turns your clients into followers and advocates who will help promote your business and be the source of endless referrals.
Satisfied customers. Thriving business. Happy owner.
Here are four simple steps to help you identify your ideal customer:
- Create a spreadsheet of all your customers from the past few years. Which ones have you done the most business with? Which have been the most profitable? Make a list of these customers.
- From your list of profitable customers, identify those who you know have been referral sources. Usually, only happy customers will act as referrals, and in most cases, customers are happy because you add value to their business.
- Now that you have a list of happy, profitable customers, use it to find patterns. What do these customers have in common? Why do they value your offering? Answering these questions will help you further refine your ideal customer list.
- Once you’ve analyzed the list and ascertained the characteristics that define your best clients, you are ready to create an Ideal Customer Profile. Use this to refine your marketing strategy and think about ways you can offer these ideal customers even more value.
That’s all for today. Until next time, feel free to weigh in on Twitter to ask us your marketing and branding questions, or let us know what kind of events and topics you’d like us to cover.