If you’ve ever wondered how to define what customer you should be spending your time and money in, this post is going to help you. By the end of this, you will understand why this one thing can change completely the focus of your company and team, it will impact your numbers, your planning and ultimately, your marketing strategy.

First, let’s start with what’s most important for your business. I can say that, in my experience, after years of meeting with new clients and employers and having that first conversation before we begin a project, even before I get hired, all of them have one thing in common: they reach out to me because they want this magic, transformative thing to happen to their company: G R O W T H.

And don’t we all? I mean seriously, we all need to grow as a person, as a human, as a friend, as a professional, as a business, we even go to the gym to grow our muscles! (and reduce our hips, of course…). It is the one thing that keeps us moving forward, fighting and sometimes even looking for a change.

*bonus marketing tip: want to sell something? Show them how your product/service will make them grow!

So, back to “business growth”, what does this mean?

Short answer: None, and all of the above.

I know, I hate this answer too! But it really is the truth. The real answer will depend on you, the person who cares about the business.

During my experience, I’ve seen businesses where all of the above apply: In order for them to grow, they need to expand geographically, therefore meet new markets, therefore grow their customer base, which in the end help them make more money.

You would think this applies to any business, simple math right?…. ohhh, but it doesn’t. In many businesses, growth means dropping some clients, reducing its number of locations, and focusing on their IDEAL CUSTOMER.

So really the big secret is just that. Choosing your ideal customer first and then, making your marketing strategy. Just the way customers choose a product or a service, you, as a business, also have a right to choose the right customer.

Why is this? It all comes down to the famous 80/20 law. And if you’ve never heard of this, it basically means that 80 percent of what you have comes from 20 percent of the market (you can apply this law to almost anything in life, i.e.: 80 percent of your productivity is done in 20 percent of your time, etc.).

Now comes ONE BIG question: HOW DO I CHOOSE THE RIGHT CUSTOMER? And it is BIG… it is so big that many huge operating businesses haven’t figured it out after decades of operating.

Over the years, one thing I’ve learned is that not because you have a paying offer (in other words, someone interested in your service/product) it means it will make your business, or even for yourself for that matter, grow. It is possible that you are not the right fit. Doesn’t mean he/she/they are bad for any business, just not for your business.

For instance, I have a customer that sells gourmet products. Their ideal client is restaurants that buy their packaged products as well as supermarkets. Their strategy’s vision is to make their product an everyday product for every family in the city. Their sales are growing according to their production capabilities and their promotion strategies seem to be working. Recently, they thought about offering their product packaged as seasonal gifts. This would probably hinder what they are aiming for. If the strategy is to make it an every-day product, it is a bad option to sell it as a “special-occasion” product because this creates an impression that the product is not for every-day consume. This would make their short-term sales increase, but their long-term goals would be considerably affected. Those customers are not their ideal customers, they take the business focus and effort out of track.

If you pay attention to the example I just showed you, you probably identified one of the main things to consider when deciding who is your ideal customer. Rule number one: ALWAYS THINK ABOUT YOUR LONG-TERM GOALS. Sometimes, short-term goals can be tempting and be deceiving, win the battle by reminding yourself what are the HUGE rewards from sticking to your long-term goals, it is the target you can never lose sight of, no matter what.

Start by answering this questions: what do you want your business to become? where do you see it going? what is really the kind of growth you want to see from it?

So, back to the 80/20 law. Does it mean you have to ignore 80 percent of your customers? Not necessarily (although sometimes it does). It is possible that in order to get to that valuable 20 percent, you first need to attract part of that other 80 percent.

Ok, so right now you probably feel confused with too much information and too many HUGE things to think about at the same time. My advice here is to follow this steps:

The Ultimate Step-by-Step-Guide to Defining your Ideal Customer:

  1. Define your business: what problem/s are you trying to solve? who are you helping solve this problem? what are your markers for growth? how much growth are you expecting for the next 1, 3, 5, 10 years?
  2. Define your valuable 20 percent customer: who am I getting the most efficient sells from (less cost in time and money with more growth)? can I find more customers like this or is it better to upsell to my current ideal customer/s? do I need other types of customers to get more sales from my current ideal customer or more ideal customers?
  3. Get into detail: now that you know who your ideal customer is, get as specific as possible. This is where tools such as creating personas (which is a whole other post) comes in very handy. Try to define what are their wants/needs as well as their fears/pain points, their habits, their taste, the words they use, the places they visit, the dreams they have… The more you know them, the better you’ll be able to reach, help, communicate with and, ultimately, sell to them.
  4. Reevaluate your orbit customers and eliminate the ones that are taking time and energy instead of taking you where you want: fire clients! stop selling that product! change store locations! GET RID OF THE CLUTTER AND FOCUS ON WHAT IS REALLY IMPORTANT TO YOU AND YOUR BUSINESS GROWTH.
  5. Love your ideal customer and give them the best of you, your company and your service or product: Give yourself the opportunity to build that business you’ve been dreaming of.

Conclusion:

Defining your ideal customer is not only essential for your growth, it can be the core of your business, of your decisions and the direction of your company. You need to take this seriously and give it a long thought. Be true to your business and team and take the right decision by focusing on who really matters. If you do this, you are going to start seeing BIG results. Think about your ideal customer every time you take a big decision and you’ll most likely get it right!

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