The secret to finding your ideal customers is right in front of you. It is something that seems obvious but hasn’t always been in the B2B Sales world. The old model of chasing every potential prospect is fruitless and outdated. The best way to find ideal customers is to look at who you are already best serving. You need to create your ideal customer profile. But where do you find the information you need? What is the source of your ideal customer profile?
Briefly, the ideal customer profile outlines the characteristics of the companies representing your best opportunities. The profile becomes your best tool to identify your ideal customer profile quickly, easily, and accurately instead of going by your gut instinct.
Instinct is great as far as it goes. But by supporting and enhancing it with hard data and experienced analysis, you will have the best chance of hitting your mark on the first try. Remember, by selling only to ideal customers, you can close up to 90% of your sales opportunities.
The Ideal Customer Profile Is More than Traditional Customer Analysis
When you build your ideal customer profile, your team is digging deep to find patterns in how your best customers and ideal prospects do business. The profile focuses on not just what they say but how they behave.
Get that shovel and have your team dig all the way down to your best customers’ core values. What business problem are they trying to solve? You need to know more than vague ideas about how that customer might use your features and functions. You have to show the prospect exactly how your offering solves the problem and saves them resources.
Look for patterns in how they:
- Shop for and purchase solutions
- Buy from other companies
- How they conduct business overall
Importantly the ideal customer profile identifies Power. That is the person who can increase or even create a budget. To sell to Power, you must know who Power is. What are sample titles that have approved your projects in the past? If a Capital Appropriation Request (CAR) process was used to gain internal approval, what titles signed-off on the project? This is one way to determine the source of the decision-making Power.
Once you learn all this about your ideal customer profile, you can sell far beyond features and functions. You can determine Power’s pain points to drive the purchasing decision. Learn the mutual fit between your organizations. Clarify Power and their pain points and show them how your solution resolves each one.
The Source of Your Ideal Customer Profile — Your Best Customer
You create your ideal customer profile by gathering and analyzing a variety of characteristics about your best customers and the prospects you hope to find.
Selling to Zebras classifies characteristics into several different buckets, which we will define in future posts.
- Company characteristics
- Operational characteristics
- Access to Power
- Return on Investment
- Technology characteristics
- Service characteristics
Each set of characteristics adds to the high-definition picture of your ideal customer.
How to Analyze Your Best Customer
Your best customer is the one you would use as a reference. Get ready to dissect the traits that make them the best customer to find the key to identifying the ideal prospect.
Your team should ask, “Which are our best customers in terms of repeat business and profitability?”
Reference-worthy customers are those who continue to buy from you. They provide you with significant profit potential because they buy at higher margins.
Next, the team should ask, “What makes the relationship positive aside from revenue and margin?”
To answer this question, every department that interacts with the customer regularly should provide input.
Once the team answers these two questions, evaluate some recent sales wins. Look for common threads between the customers and the deals. Determine why you won. Ask the customer why they bought from you. Understanding why you won the deal helps you discover your strengths so you can leverage them in the future.
How to Identify a Non-Ideal Customer
As important as it is to know what defines your ideal customer, it is also critical to know what your ideal customer is not. You want to quickly identify non-ideal prospects and eliminate them from the pipeline as early as possible. You don’t need to waste resources on an unlikely sale.
How can you tell a non-ideal customer? Take a look at your most recent sales losses. How were they different from your wins? Which one of your competitors got the deal instead? Why did they win and not you?
If you don’t know the answers, call the prospect and ask them. They can tell you where you fell short.
Also, look at the deals that are gathering dust but never closed. The most significant time drain and reason for unclosed deals is apathy or status quo. These deals are in a sales cycle that always ends in “no-decision.” Learn how to keep these out of your pipeline, too.
And Now to Create Your Ideal Customer Profile
You have a list of your best customers. You have put them under the microscope and learned insightful information about all seven classifications of characteristics.
As you work through the list, write down answers to pertinent questions about preferred and undesired behaviors and look for patterns among your best customers. Use the answers to create the appropriate qualifying descriptions that comprise both the weakest and strongest ends of the ideal customer spectrum for each category.
Are you ready to analyze? Read our next post, where we define company and operational characteristics and how they help you create an ideal customer profile.