There is not a business out there that sells its products or services to everyone. I find this shocking, but some people really don’t like chocolate. So, if you aren’t selling to everyone, who exactly are you selling to? The 80/20 rule suggests that 80% of your sales are coming from 20% of your customers. In my experience that is a pretty good estimate although in some cases it looks more like a 90/10 rule.
When I work with clients on their marketing strategy, (remember marketing is not just advertising,) I start by asking who will want to or who does buy their product or service. The customer must absolutely be the main focus of every business. Some clients are resistant to this and are afraid they may miss out on customers by narrowing this down. But, you can’t be everything to everyone and if you try, chances are that you will connect with no one. Close your eyes and visualize your ideal customer. This can be one of your actual customers or a hypothetical one. This is how we start a customer profile or persona and I want to know everything about them.
Demographics are the easiest to begin with. Age, gender, race, income, educational level and marital status with or without children in the household create a generic profile that you can build on.
Psychographics come next and this refers to someone’s interests, personality, lifestyle and values. What does your customer do in their free time? What are their hobbies? Do they like sports? Do they like to cook or eat out? Do they travel? Do they work out? Do they have pets? What kind of music do they listen to?
Round out the profile by considering your customer’s behaviors. What motivates them? Is price or customer service more important? What about convenience? What type of promotions do they respond to? Are they a loyal customer or always looking for the next best thing? How do they receive information?
Let’s try this by choosing something we think everyone buys such as insurance. You sell home, life and auto insurance and everyone needs at least one of those, right? If you can sell all 3 products to the same customer you make more money than selling 1 to 3 different customers. There is a huge difference between someone who needs all 3 and someone who just wants the minimum required auto coverage.
What does your ideal customer look like? Male, age 45, $200,000 annual income, master’s degree, single family home in a gated community located in a flood zone, 2 kids in private school, wife works part time for fun and plays a lot of tennis, has a dog, drives a Mercedes sedan, wife drives a Ford explorer, most socializing is done through kid’s school and extracurricular activities, leaves the house at 7:30am and checks his LinkedIn when he first gets to work, etc.
The end result of building a customer profile is a greater understanding of where and how to reach this customer so that you can more effectively communicate your product or service message. Your product or service is of great value to this customer and they are willing and, more importantly, able to pay for it.
(Source: Becky Brownlee, Consultant, UGA SBDC Southern Coastal)