- Elon Musk, Investor & Entrepreneur
Customer profiling is when companies keep track of certain consumer behaviours to market and sell their services to an engaged target audience. Think of a customer profile as a detailed description of the purchasing behaviours, demographic and psychographic data of the people who repeatedly engage with your product. Customer profiles can help companies analyse the services they deliver to decide which customer demographic is the best fit. This in turn helps with marketing campaigns and deciding the most effective way to communicate to the client groups that your company might be targeting.
Customer profiling is highly recommended and essential if you are looking to expand your business. It will lower your customer acquisition cost (the amount of money you spend on marketing and campaigns) and improve your service as you are more familiar with your customer’s pain points and purchasing habits.
How To Determine Your Ideal Customer
Before getting into the nitty-gritty, determining your ideal customer involves outlining your company values, the objective that you are working towards and the types of people that you want to market your services to. Diving a little deeper it involves analysing the demographic, psychographic, behavioural and geographic characteristics that drive consumers towards your services. Ideally you want to be targeting clients that support your vision, utilise the services that you offer and are moving in the same direction as your business.
How To Build An Ideal Customer Profile
The foundation of building an ideal customer profile involves focusing on the problem that your business is trying to solve. Once this is done, you need to identify the type of people who face this problem so that you can deliver a service that is on par with their needs. Next, it’s a good idea (not essential but super handy!) to review your customer journey map to see who’s buying your products and interacting with your brand. A customer journey map is basically a document that outlines each touchpoint your customer passes through when engaging with your company.
It’s then time to dig into the demographics. Start high level (such as which market does your product best serve?) before building your customer’s persona and examining the contextual details. Here are some handy factors to consider:
- Age Group
- Marital Status
- Family Size
- Urban or Rural
- Population Density
- Pain points
- Current solution to pain points
- Price Sensitivity
- Readiness to buy
- Product Usage
- Purchase history and brand loyalty
Don’t just rely on the data, collect feedback through customer interviews, phone calls and surveys. This is the best way to get to know your customers and will also improve your services and products if you take on board the feedback received. Another major contextual detail to consider is where your brand is in comparison to your industry competitors. Who are you competing with for attention?
There are several customer profile templates that you can use to build your ideal customer profile. You might like to use the scorecard system where you score a customer’s budget, authority, need and timeline against your services. However if you are looking to create an effective campaign you might want to look at building a segmented customer profile where each customer type is broken down into the demographical, behavioural, geographic and psychographic traits above.
How to identify your ideal customer
Identifying your ideal customer involves looking at the customers that you already have and determining whether they are the type of client that you want to continue having, or if you want to target a new customer base. It might help if you consider your ideal customer’s habits and how those habits align with the type of service you offer.
When doing so, it’s important to look at your customer’s goals, fears and the factors that influence their business decisions. Do their consumer problems align with what you are offering as a company and are you able to be the solution? The most important step in identifying the ideal customer is determining what your client needs. Once you identify what your clients desire, it is much easier to pitch, market and acquire a loyal customer base. Don’t forget to ask yourself, who would you like to work with in business? Who are the types of clients that you want to provide for?
Analyse the types of clients that you have worked with previously to review what did/didn’t work and why. Where did your customers get their information from and how did they end up finding you?
When identifying your ideal customer there are many questions you can ask. It can be helpful to identify the client’s age, gender, marital status, level of education, location, if they have children, what their income might be, what type of work they do and how they gather their information (blogs, books, social media). You should also ask what the customer has tried before and why they are now seeking your business. Good luck!
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Thought leaders & celebrities share their tactics for success on the Lisnic podcast by Lisa Teh & Nick Bell