This July Only: Save 30% on PRO with code SUMMER30 »

Real-World Education for Modern Marketers

Join Over 616,000 Marketing Professionals

Start here!
N E X T
Text:  A A

Who Is Your Ideal Customer? Three Simple Ways to Find Your Target Market

by   |    |  15,036 views

Determining your target market and acquiring accurate data on your sales prospects may be the most important first steps in developing and managing your long-term sales and marketing strategy, but they are also steps worth repeating to ensure your success. Salespeople must continually evaluate and determine whether those initial assessments were, well, on target.

Unfortunately, the old adage that "a product sells itself" is nothing more than a sales and marketing myth. Products sell in large part because of the due diligence that is completed before the first sales call is made. That means taking the necessary time to create your "ideal customer" profile and then securing a high-end database of prospects and companies that match that profile.

My company, AG Salesworks, took such a course of action two years ago as part of its long-term sales strategy. At the time, we at the company also made a commitment to revisit the process on a quarterly basis to compare the results we'd achieved with the goals we'd established. We went through a very simple three-step process:

  1. Identifying our ideal profile by reviewing our current client roster
  2. Acquiring a spot-on list of decision makers at companies that were similar to our "favorite clients"
  3. Reaching out to the key decision-makers at those companies.

Think of that process as a "how-to guide" for conducting your own internal sanity check on whom you're selling to and where you're finding them.

Step 1: Whom do I love doing business with today?


Your current client roster is the best place to look for determining whom to sell to. Doing so is admittedly a little easier if you are an established company and you have 10 or more customers. For a startup, you'll need to rely more on your gut and past experiences in each category.

Break down your evaluation of clients into the three categories listed below, and then establish your own benchmarks in each category to match your unique business. Listed are my company's categories and benchmarks from two years ago, and they remain the same because the exercise worked.

  1. Revenue paid to your company annually (my company set the threshold at $150,000 per year)
  2. Tenure as a customer (minimum of one year with your company)
  3. Willingness to be a reference for your company in the sales process (yes or no)

Assess each client against those three criteria to create your master list of "best customers."

Note: I love these criteria because they're simply highlighting the people who pay you the most, stay with you the longest, and say nice things about you publicly. Exactly the folks your long-term sales strategy should be targeting.

Step 2: What do my favorite customers have in common?

Finding the commonalities among your best customers can be time-consuming and difficult to complete internally. If you are up to the task, go for it, but I recommend using a third party to conduct an assessment of your ideal customer list for two reasons: It will be done faster, and it will free up your time so you can sell.

Assessment will work only if you have the following information in each record:

  • Industry
  • Number of employees
  • Annual revenue
  • Title of the person who authorized the purchase (signer)
  • Title of the person who drove the purchasing process (driver)
  • Title of the executive who invariably got in the way at the very last minute with concerns and questions after not having been involved at all in the process (chief financial officers and general counsels come to mind…)

You can add geographical information if that matters to you. If you don't have each record completed, you can have your third party fill in the holes (or have your summer intern do it). Either way, once you have the full information, you'll need to find the similarities.

To do so, summarize the list in each category and form a consensus as to what is most common in each. Here is what my company came up with after looking at our top clients:

  • Most earned $100 million to $1 billion in revenue.
  • Most had 300-plus employees.
  • Most were software companies selling business to business.
  • The most common three target titles were director of marketing (driver), vice-president of marketing or chief marketing officer (signer), and general counsel (roadblock).

With little effort, we developed a simple-to-understand guideline for identifying those we should be targeting. Now, all we had to do was to find the contacts.

Step 3: Finding the contacts

You can go down two paths to get to a large and healthy list of target prospects ready to buy your products or services: One is to hand over your newly minted ideal customer profile information to your preferred data provider, and see what you get back; the other is to use the data you already have.

Some folks are even brave enough to do a combination of both.

Data quality is always an issue when buying lists, so if you do engage a data provider, make sure the provider gives you a guarantee; and be prepared to track bad contacts so that you can return them for replacements. Also, make sure you get great service. I know this sounds hokey, but I've seen a direct correlation between the level of customer service I've received and the quality of the data: the poorer the service, the worse the data.

If you want to use your existing data, that is great, but you'll have to conduct one more assessment before you can use it. You'll have to run your ideal customer profile against your own database to make sure that the information you have in-house actually matches. If it does, then you are off to the races. If it doesn't, then you'll have to go to a data provider for help.

* * *

The three-step process I've outlined helped our business tremendously over the past two years. Be sure to take the time needed to complete the process internally, and don't forget that you have to keep doing it every quarter to make sure that you are still on track. Markets change over time, and you'll want to be sure that you can always easily identify your ideal customer.

(Photo courtesy of Bigstock: Target your customers)


Join over 616,000 marketing professionals, and gain access to thousands of marketing resources! Don't worry ... it's FREE!

WANT TO READ MORE?
SIGN UP TODAY ... IT'S FREE!

We will never sell or rent your email address to anyone. We value your privacy. (We hate spam as much as you do.) See our privacy policy.

Sign in with one of your preferred accounts below:

Loading...
Peter Gracey is chief operating officer at AG Salesworks, a B2B teleprospecting and marketing services firm.

Rate this  

Overall rating

  • Not rated yet.

Add a Comment

Comments

  • by @jpatrickjobs Wed Aug 22, 2012 via web

    Great post. We are recruiters for sales and marketing people in the IT vendor space (I'd imagine our client base overlaps a bit!) and we have a scoring system for clients and individual job orders. Factors include access to decision makers (hiring managers rather than HR only), difficulty to fill, length of interview process, and other factors such as the industry verticals we serve (infosec, videoconferencing, etc.)
    We then try to collect as many of these types of clients as possible, through emails, blogs, linkedin, jigsaw and calling calling calling.
    The phone is still the killer app for recruiting
    Dan Sullivan

  • by Rishi Wed Aug 22, 2012 via web

    I think, as pointed out, the willingness for the client to be a reference during the sales process is really quite important during the sales process. Most sales people don't add this to their client evaluation metrics. It's pretty important to the process of proving your company's successes. Always ask your client if they are willing to back you as a reference if your company does a good job. You wouldn't get a high paying job without previous references, would you? Check out our digital marketing tips and tricks at http://mdv.to/NmISj3

  • by Mike Lovas Wed Aug 22, 2012 via web

    With all due respect...

    This piece seems to place great value on demographics. I've loooong been frustrated with marketers who believe demographics equate to a true profile. My firm specializes in psychological marketing, and (in our experience) demographics continually prove to be unimportant beyond the most remedial steps.

    Ultimately, your work comes down to communication, and that means crafting your message to one individual (or one type of individual) at a time. If all you know about him/her is the data listed in the article, you will likely not know how to craft your message so it is an accurate communication. Without some kind of psych profile, you are limited to delivering the same message to everyone - not very accurate.

    But, take heart - if you know the job titles, that gives you a peek into the psychology of the individuals at the target firms.

    Mike Lovas
    http://www.aboutpeople.com

  • by Pam Didner Wed Aug 22, 2012 via web

    Really enjoy your post, The devil is in scrubbing the data and nurturing the leads.

  • by Thirdy Rosales Wed Sep 5, 2012 via web

    Your next clients and customers could be some of the faceless persons within the crowd that you meet day in and day out. The point of attracting customers is to make them fell that they need your products and services. The old-school practice of giving corporate giveaways may attract customers to some extent. Through these simple items, your company can draw clients and at the same time, retain your branding.

  • by Gwency Radnor Wed Sep 5, 2012 via web

    Very Informative. Thank you for this Peter

MarketingProfs uses single
sign-on with Facebook, Twitter, Google and others to make subscribing and signing in easier for you. That's it, and nothing more! Rest assured that MarketingProfs: Your data is secure with MarketingProfs SocialSafe!