5 Steps to Identify Your Ideal Customer

by Kat Boogaard

Take a minute to think of something that you know absolutely everybody likes. What came to mind? Vacations? Well, time off actually stresses some people out more than it relaxes them. Puppies? Some people are afraid of or allergic to dogs. Chocolate? As strange as it might seem, not everybody loves it.

It’s hard to think of something, isn’t it? People are different—we all like, want, and need different things. Our choices are motivated by our personal thoughts and preferences. Emphasis on the word personal.

Your business works the same way. It’s not a “one size fits all” solution. There are certain people who will absolutely love your product or service and rave about it until the cows come home. Others? They simply won’t see the point or value in what you’re offering.

It’s for this very reason that it’s so important to identify your ideal customer—and that’s exactly what we’re talking about here. From defining what exactly an ideal customer is to actionable tips you can use to discover your own, this post is sure to have you narrowing your focus and refining your strategies. Let’s get into it!

Bonus: Ask yourself these 10 questions to identify your ideal customer.

What is an ideal customer?

Before you can charge ahead and zone in on your target, you first need to have a solid handle on what exactly an ideal customer is.

When you think about it this way, the entire concept is quite simple:

Makes sense, right? But, most companies niche it down even further than that in order to develop a true, comprehensive understanding of their customer.

what-is-an-ideal-customer

Let’s take the example of a car salesman. Using the simple definition, the salesman’s ideal customer would be anyone who has even remote interest in buying a car. That’s still pretty broad, isn’t it?

However, this salesman specializes in top-of-the-line, luxury vehicles. So, he’s probably not going to spend a lot of time with that college graduate who’s looking for a $2,000 beater. Instead, he’ll focus his time and energy on high-income professionals—likely in their 30s to 50s—who want a car that’s a status symbol. See the difference?

So, yes, your ideal client is someone who benefits from your product or service. But, it’s also defined as someone you most want to target with your marketing and promotions based on your current business situation. Perhaps you’ve been mainly reaching creative freelancers, but you’d rather shift your focus and work with more agency founders. Your existing customers may not necessarily be your ideal ones.

In a perfect world, your ideal customer will marry both of these aspects. They’re someone who sees tons of value in your product or service, but will also help push your business in the direction you want to go.

How do you find your ideal customer?

Now that you know what exactly defines an ideal customer, it’s time to get to work and reach them! How? Here are the steps you need to take.

Step One: Know Your Product or Service

First thing’s first, you need to have a solid understanding of your business. That doesn’t just mean knowing the ins and outs of your financials or being able to recite your website copy in your sleep. Instead, you need to have deep knowledge of your business from your customer’s point of view.

Get out a notepad and pen and jot down exactly what you offer to your customers. What problems do you solve for them or what challenges do you address? Why should people buy from you instead of your competitors? What sets you apart?

Who actually benefits the most from your product or service? When it comes to this question, you need to be honest with yourself. It’s not enough to determine who you want to benefit most—you need to identify who is actually finding value in your offerings right now.

Step Two: Determine Your Goals

Once you’ve looked at your business through your customer’s eyes and identified who is currently buying from you, it’s time to determine what your goals are.

Are you happy with this current type of customer and, more importantly, are they happy with you? Or, do you feel that you’re not appropriately targeting the people who would value your business the most? For example, you’ve been working with a lot of startup founders, but would like to form partnerships with more enterprise-level companies.

Startup Stock Photo

Startup Stock Photo

As mentioned above, your current clients or customers may not be your ideal ones. Maybe you’ve noticed that your customer retention rate is really low—people are buying once, but not returning. Perhaps you’ve been on the receiving end of a lot of customer complaints. Or, maybe you just want to shift your focus, change your business model, and reach a totally different audience.

This is the time to outline your goals. Determining what specifically you want to achieve will help you alter your strategies when it comes to your customers. Just think—if our car salesman set a goal of reaching $10 million in sales this year, he’s probably going to stay far, far away from those broke college kids.

Step Three: Analyze Past Interactions

Your past interactions with customers can reveal a lot—both good and bad. Combing through any major mistakes and successes with previous or existing customers will definitely help you in narrowing your focus.

First, look back on any huge flubs that made your stomach turn. Did those incidents have anything in common? Perhaps they all resulted from miscommunications with clients in totally opposite time zones from you. That means you may want to stick closer to home and only work with people in easier-to-manage time zones in the future.

Also take some time to go through any big wins. Whether it’s reading through your customer testimonials or paging through old emails to find those major accomplishments, you should also try to identify any common threads here. Maybe those customers all had the same problem you were able to address with your product or service. Perhaps they were all in the exact same industry.

Sort through your past interactions and pull out what you can. That information will all be incredibly valuable in the next step.

Step Four: Build a Customer Profile

You’ve done your research, put in the legwork, and are ready to outline everything that makes your customer tick. This is when you’ll build your customer profile, which shares all of that need-to-know information about who exactly you’re trying to target.

This process involves answering some important questions that cover everything from basic demographics to what influences their buying decisions. Find out as much as you possibly can about your particular customer. The more you know, the more powerful you’ll be.

Bonus: Ask yourself these 10 questions to identify your ideal customer.

If you really want to get inside your buyers’ heads, customer interviews are an effective tool. Pick a few of your current customers and set up a time to chat. Ask the right questions, and you’ll learn what they love about you, what they don’t like about you (I know, ouch), as well as what inspired them to choose you over your competitors. That information straight from the horse’s mouth is invaluable.

Step Five: Remember Your Hard Work

So, you pulled together a detailed profile of your ideal customer and made sure everyone on your team was on the same page. Now what?

Unfortunately, many businesses make the mistake of putting all of the time and research in, and then just letting that information sit there unused. If your goal is to target those specific customers in order to continue improving your business, you need to always keep the information you gathered at the top of mind. It should influence every move and decision you make.

remember-your-hard-work

Simply saying you want to target those people isn’t enough—the act of defining your ideal customer won’t bring them to you. You need to take that information, put it into play, and get to work!

Final Thoughts

Identifying your ideal customer can seem like an overwhelming and daunting task. However, it’s an important step in growing and improving your business, and with these five steps, the process doesn’t need to be overly complicated. Follow along and you’re well on your way to not only reaching new customers—but the right ones.