When I'm coaching a business owner and I ask "who is your ideal client" I sometimes get an answer that looks like this: "anyone who is willing to buy my product or service." My next question is "can you describe what this 'anyone' you have in mind looks like?" Some are perplexed by this question since they expect to focus a sales strategy conversation on their product and how good it is instead of who's going to buy it. While the excellence of your product is of crucial importance, let's set that aside for another article and let's focus today on being very specific about knowing exactly who your client is… and who is not.
Your ideal clients are the people or companies most interested in your offer, who will reap the most value from what you do for them, and who are most likely to be loyal customers. Think of your unique selling proposition - what sets you apart and above from your competitors - and how only you can provide that value. Now think of who is the client that has a very specific need that only you can solve; in other words, a perfect match between need and benefit. This will very likely point to the description of your ideal client. Be aware that the existence of a specific need is not the definition of the client. First you need to know who they are so that you can direct your marketing efforts towards them, and then you probe deep to discover if they have a need that you can solve. After you solve their need and the urgency goes away, they are still your client who could buy again or refer you to someone in a similar situation.
You need to be very specific in describing the characteristics of your ideal client. If you sell to consumers, describe their demographics: age group, education, residence, income bracket, family status, hobbies, preferences, likes, etc. If you sell to companies, describe their industry, specialization, employee size, location, years in business, annual revenue, goals, etc. Having a laser focus on who they are and where to find them is essential to determine how you will approach them.
Sheryl Clark, the President and CEO of Boston Proper, an online clothing boutique for women over 40, has cemented "Lucy" at the center of all conversations that refer to their ideal client. They created the persona - or avatar - of Lucy to fully represent the client they thrive to make happy. If you listen to Sheryl's interviews, she never says "clients, clientele, customers, target market" instead she says: "Lucy likes this… Lucy would wear that… Lucy is looking for… " Having this meticulous focus on the persona of Lucy makes all internal stakeholders conscious that what they do is all about Lucy and not about fashion or clothing, which is - to no surprise - reflected on their overall NPS (net promoter score) of 74 in an industry where 30 is considered "good".
A close look at your current clients will also help determine a description of the types of clients with whom you are most successful. This evaluation will yield three pieces of crucial information: (1) where you need to focus on building loyalty (repeat purchases, referrals), (2) identify areas of improvement to serve them even better, and (3) the low-end of your list where you will find the lowest return-on-effort. You will have to make tough decisions about your non-ideal current clients. They are draining your limited resources and not giving you enough business. You need to focus your efforts on serving your top clients to the best of your abilities.
However, let's not forget that the growth stage of your business is also an important factor to consider. In the early stages, gaining traction and cash flow is more important than filtering clients. You may consider signing up a non-ideal client in your earlier stages as you seek that precious revenue, but as your business stabilizes, you get busier, and plan your next inflection point, narrowing down your focus on ideal clients will allow you to be more profitable. Keep in mind that as your client perceives more value, price sensitivity will become a secondary issue. Said differently, the more excited your client is about what you offer, the less susceptible they are to your pricing. If you can define who would be the people in most need of your product, you are on-course to achieve the coveted segment of your market that is driven by value, not price.
Lastly, it is also important to pay close attention to what your competitors are doing. They are also targeting your ideal client and their approach might be different. Look at what makes them successful and also look for incoming new vendors that may disrupt your market. These factors must also be weighed to define the upcoming improvement you will make to your product or service. Why do I mention competition in an article about the ideal client? Your client will also change over time and while their need may remain unchanged, they may be looking for easier or alternative ways to fulfill their needs.
Back to the example of Boston Proper, they have been in business for over thirty years. Although Lucy has always been in her 40s, today's Lucy does a lot more shopping from her smartphone than the Lucy of 1998, who folded the corner of the pages of a printed catalog. Lucy is no longer a Baby Boomer, she's a mix of Gen-X and a few early Millennials. Boston Proper has adapted to Lucy's new habits and how she prefers to browse before she shops. Lesson learned: evolve with the market and for your ideal client, and make sure you will meet them where they want to be.
A crystal-clear clarity on who is your ideal client will help you increase the efficiency of your marketing, build customer loyalty, and afford a higher profitability.