How to Determine Who Your Target Client Is
“We can sell to the world!” Many new business owners have uttered these very words in their excitement to start their business. They have conceived of an idea that, in their opinion, every company or consumer on the planet could potentially buy. Based on this strategy, they go out to just about anybody and sell their wares. We talked about the different phases most companies go through in their evolution in the previous tip on leads. As your company matures, you realize not everybody out there is a good fit for what you do, so you need to narrow your focus to determine your best target clients.
Look at Your Client Base
I’m often asked, as a sales and business development consultant, “How do you determine who your target client is? Or, how do I determine who that is?” And I tell them, “The first step? Look at your current client base. Who have you done business with over the years that you’ve been successful with?”
Eliminate
But the first step is to understand those clients who have not been a fit. Perhaps you went against your instincts and sold them anyway. They probably beat you up on price when they bought, and you figured once you got them on you could make them happy. You soon found out you could not. No matter what you did, it was never right in their eyes. They complain, they suck resources and create discontent within your team. Yet for some reason, you have continued to hold onto them. We’ve all had those clients with whom we haven’t been so successful. The good news is that they serve a purpose! They are the ones who will help you build a profile of prospective clients you don’t want to do business with.
Narrow
Now take a look at your happiest clients. Chances are you will find them to be flexible, good communicators and low maintenance. Price is most likely not their biggest issue, they probably use multiple products or services of yours. There may also be other more objective characteristics of your best clients as well. You might find some patterns around industry, employee size, revenue size, location or product requirements. Take some time to put together a list of common traits of your most successful clients. Once you have done this, you will have defined your initial list of target client criteria! Now you can add more research to it if you want to get technical, but your own client base is a great first step in helping determine who you should be proactively going after as new clients.
Spend Your Resources Wisely
To be clear, when we talk about Target Clients, we are talking about those you are after proactively with marketing dollars and sales activity. Chances are, the size of the target market is pretty large and will keep you and your Sales team busy. Now, this does not eliminate opportunistic sales opportunities. If a deal happens to be in-bound, it should be evaluated for fit. Even though it may not be in your target market, it may have enough characteristics to be considered as a new client. So the door is not shut to opportunities outside of the Target Client Criteria, they just need to knock to get in.
The Value
By focusing your limited time and resources on the right types of companies, your right target clients, you will see a number of benefits.
- Your Sales team will be more focused and efficient.
- You’ll be able to close more business more profitably in a shorter period of time because the knowledge of the needs of the client and their fit to the product are already established.
- You will have a more predictable stream of new opportunities.
- Your service organization will become more efficient.
So take the time to evaluate your current client base to understand who you should be going after to effectively grow your business and create the success you desire!
