What I’m about to tell you about is nothing short of the foundation of all successful businesses. Yet most business owners are only vaguely aware of this and don’t spend much time thinking about it, when they should spend most of their time thinking about it.
What is it?
It is a complete and exhaustive understanding of the characteristics of your ideal customer.
All business owners know who their customers are, don’t they? Not exactly.
Don’t misinterpret the point I’m making. You should know your customer about as well as you know your spouse. (I said about!)
Why is this so important?
Once you know the characteristics of your best customers, you can then seek to clone them by finding prospects that fit their profile.
This doesn’t happen by accident – it is a very deliberate process that is more involved than it appears at first.
Let’s start from the beginning – how do you go about selecting a market to begin with?
Selecting a Market
No matter what business you are in, you need to carefully select the market that you will be selling to. If, for example, you do home remodeling in the Seattle area and you define your market as ‘homeowners in the greater Seattle area’, you are in doomed to failure.
If you go with this approach, your message will be so broad that it won’t strongly appeal to anyone. When everyone is your customer, no one is your customer.
Getting this right is of utmost importance because your marketing message will be tailored specifically to your chosen market. The reality is that a poor message aimed at a well-selected market will produce far superior results than an amazing message aimed at a poorly selected market. Spend the time to get this right.
Narrowing the Market
Once you have a market in mind, narrow it down. Consider these aspects when narrowing your market:
- Do you have the ability to reach the market affordably and efficiently?
- Is your market known to be responsive?
- Do you have an understanding of the market – can you empathize with their needs and desires?
- Do you have a natural affinity with the market?
The more you can narrow your market, the more you can tailor your message to their specific trigger points. Your message should resonate strongly with your chosen market segment while simultaneously being of no interest to everyone else.
A Gold Mine
If you’ve done this right, you are now building a highly responsive and engaged customer base that finds value in your products or services.
Don’t stop here.
The largest expense for most businesses is customer acquisition. Once you have them, sell them additional products and services, don’t try to recruit additional constituencies with different messaging. The hard work is done! Now is the time to work on maximizing customer value. Here are just a few ways to do that:
- Communicate more frequently – not just offers, but useful info and humor
- Reward your regulars with special deals
- Turn your products and services into a subscription service
- Group your customers by level of engagement and develop strategies for moving low engagement customers ‘up the chain’ – one-time offers, free samples, buy 1 get 1 free, etc.
The Bottom Line
A lot of work goes into market selection. Don’t overlook this aspect of your business. Pay very close attention to the characteristics of your best customers. Determine what they have in common and develop strategies to find more of them. This will ensure your marketing message is relevant and allow you to maximize the value of each customer you acquire.