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How to Identify Your Ideal Customer

identify Your Ideal Customer

A lot of businesses – especially startups – say that their target audience is anyone interested in their services. But, no business can afford to market to such a wide range of people. We explore some of the best ways to identify your ideal customer and put your marketing dollars into lead generation techniques that really work.

If your business is currently marketing to anyone and everyone who may be in need of your services, chances are you are spending a lot of money on advertising. And most businesses – no matter how big or small – don’t have the endless resources needed to fuel endless marketing campaigns with no clearly defined audience.

Targeting a specific type of customer doesn’t mean that you are excluding people who don’t fit your strict criteria. Instead, this practice allows you to put more marketing dollars into lead sources and campaigns that you know will generate new customers. This means that you’ll get better ROI on your investment, and you’ll reach more potential clients within your business’s niche market.

So, how do you know what your target audience looks like? Here are some of our best tips for defining your business’s ideal customer (and getting more clients like them).

Analyze your existing customer base.

Whether you know it or not, your existing customer base contains a wealth of information about your target audience. As you look at your existing customers, ask yourself some of these questions:

  • Who are your current customers? Think in terms of industry, company size, and geographic location.
  • Why did your current customers buy from you? Did you offer the best price, the best service, or the easiest shopping experience?
  • Which of your customers are repeat purchasers? What prompted them to buy additional services from you?

The answers to these questions can help you create a clear picture of your ideal customer. You can use the information you gather to look for similar customers.

Identify the problem that your business solves for customers.

Can you complete this sentence? For the first blank, fill in the type of customer that you think you’re targeting. Then, fill in the problem that your product/service solves.

“My company helps __________ who need to _______.”

Now, take the data that you gathered from the analysis of your customer base, and see if the problem that you think your business is solving actually matches with the product or service that you provide to your top customers. If not, try looking at your product or service from a different angle; ask yourself what unexpected or adjacent customer pain points you might be solving.

Know your competition.

You’ve heard this old saying: “Keep your friends close, and your enemies closer.” You may not consider your competition an enemy, but the same idea applies.

As you evaluate your competition, ask yourself the following questions:

  • What is my competition’s target audience? (Again, think about key factors like industry, geographic location, or even gender.)
  • How does the competition’s product/service differ from mine? Where do our offerings align?
  • What niche markets is my competition overlooking, and why?

These questions will help you understand how your business compares with the competition; they may also reveal niche markets that your competition doesn’t currently target.

Implement surveys and other tools for collecting customer feedback.

No matter who or what you think your target audience could be, your customers can tell you who your target audience is now. Reach out to your current customers for feedback on how your product or service helps them, and how you can improve the way that you do business.

Surveys are one way that you can gather this kind of feedback. But, you can also ask your customer service and sales representatives to seek and share feedback when they speak with customers.

More Information: Defining Your Target Audience

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