How to Identify Your Ideal Customer

Here’s a secret that may make a very big difference in the amount of money you stand to earn from your small business: Some of your potential ideal customers are better than others.

That is, some (the ones who are willing to pay top dollar for your products or services with little intervention on your part) will earn you a lot of money, and some (the ones who nickel-and-dime you to death, complaining all the way) will actually lose you money.

Figuring It All Out

Because potential customers come in all sizes, shapes, and spending profiles — and because ideal customers don’t come with their profiles stapled to their heads — your very difficult job is to first identify your customers to figure out which ones are the most likely to become your best customers and then to figure out how to attract and reach them.

Because your time and marketing dollars aren’t unlimited, the best use of your money is to target them to specific people — the people most likely to buy your products and services.

Instead of running expensive radio or newspaper advertisements day after day, hoping to get the attention of the customers you seek, you may find that indentifying customers and using targeted advertising in a specific magazine or Web site delivers a much greater payoff.

What Does Your Ideal Customer Look Like?

Here are a few questions to ask as you create a picture and start identifying your customers. (Don’t worry if you can’t answer all of the questions right now — just give it your best shot.)

  • Who do you think your best customers will be?

  • Are they individuals or businesses?

  • If they’re individuals, what do they and don’t they like?

  • What are their needs and problems?

  • How will those needs and problems be best addressed?

  • What’s most important to your best customers?

  • What’s least important to them?

  • How will you provide more of the former and less of the latter?

Based on these questions develop a written description of your ideal customers, and have some of your customers look it over to validate it or to make corrections. Here is a sample description of the ideal customer for a pet-sitting service:

My ideal customer is a single, working adult with one or more pets, including dogs, cats, or birds that require daily care and attention.

My ideal customer often travels, has sufficient income ($30,000 or more per year) to afford to hire a pet sitter, and prefers to keep his or her pet in its home environment rather than in a kennel or other offsite care situation. My ideal customer loves his or her pets and wants them to have the best care possible.

The idea is to understand your best potential clients and customers inside out — to know what makes them tick and what motivates them.

By knowing this, you can easily figure out which marketing approaches (direct mail, Web site, Yellow Pages, search engine listings, display advertisement, and so forth) has the highest probability of not only reaching your best customers, but also motivating them to want to find out more about what you’ve got to offer.