The Importance of Knowing Your Ideal Client

Marketing is a challenge for any business, but especially for small businesses with limited resources. That’s why identifying your ideal client is so important.

When you don’t know who to market to, you end up marketing to everybody, which is a sure recipe for failure. Identifying your ideal client narrows the scope of your marketing efforts and enables you to use your marketing dollars much more effectively.

To identify your ideal client, ask questions like:

  • Who should buy from us, and why?
  • Do they have the financial resources to buy from us?
  • Of this group, which clients will be the easiest to find and sell to?
  • Which clients are we most likely to develop ongoing relationships with?
  • Which clients will deliver the most revenue over the life of our relationship with them?

To answer these questions, start by gathering as much demographic information as you can. If you sell to consumers, this will include age, sex, occupation, income level, zip code and other lifestyle information.  If your market is B2B, demographics include the industry, sales volume, number of employees, geographic area and other factors.

Next, identify your clients’ “pain points” in relation to your products or services. This is especially important in the B2B arena. What problems, challenges or issues are clients looking to you to solve? How do your products or services solve them? When you solve them, what kinds of benefits does it provide the client?  For example, how does it help them to lower costs or operate their business more efficiently? How does it help them solve problems for their clients?

Once you have this data, study your clients’ buying processes. A lot of companies will have a legitimate need for your products or services. But some may buy in a way that doesn’t fit your business model. Others might buy in a way that could make it difficult to obtain your desired margins. This doesn’t mean that you will never do business with them, but they won’t qualify for the “ideal client” category.

If you don’t have the time or resources to conduct a lot of formal research, try this approach: pick your best current client and write down all the characteristics that make them #1. How big are they? How many employees do they have? What do they buy from you? Why do they buy from you? How much do they buy from you? What makes them easy to work with? Do they pay on time? Do they refer you to other clients? Do they suggest ways you could improve your customer service?

Think of everything that makes them a great client. Then create a profile that describes them in detail. These are the kinds of companies you most want to do business with. And these are the kinds of companies that should drive your marketing efforts. This doesn’t mean you shouldn’t do business with anyone that doesn’t fit this profile. But it tells you where to focus the majority of your resources to get the best return on your marketing investment.

When you have a clear picture of your ideal client, marketing your business becomes a lot easier and more cost-effective.  Rather than broadcasting your marketing messages to the entire world – an expensive proposition even in today’s Internet/social media world – you can concentrate all your resources on those clients most likely to buy from you.

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