The other day I was scrolling through my newsfeed on Facebook and an ad popped up telling me how to market ‘my’ baby business properly. This really annoyed me for three reasons.
Firstly, I don’t have a baby business. The language used in the ad implied that I did. Secondly, it was clear this person didn’t have a clue about how to market her own business…so then how could she possibly help anyone else with theirs?
And third, I must have seen this ad appear in my newsfeed not once, but several times. This is frustrating and is the equivalent of walking into a shop and the store assistant stopping me and asking me several times if I would like to buy the same product.
Think about this for a moment. If this happened in real life, you’d probably run out of the said store as fast as possible and would never return.
And yet this is PRECISELY what many businesses do when advertising online and they don’t even know it.
The primary reason this happens at all is because most business owners don’t understand who their target market is.
You’ve probably heard the term ‘ideal customer’ many times before… but did you know that there is a direct positive correlation between businesses who know and understand their ideal customer really well and the amount of money they make?
So what exactly does that mean and how does understanding your ideal customer REALLY impact your business?
If your business serves a particular segment of the market, then you need to pay attention to this post, because in it, I’ll be focusing on the big why behind understanding and knowing who your ideal customer is.
I’ll also show you how you can leverage this understanding to make more money in your business WITHOUT spending more on advertising.
For most business owners, their primary focus is naturally on selling more of their products and services. This usually means increasing the number of customers, selling them more goods and getting them to come back more often.
It’s important to understand that you can ONLY ever increase your sales in one of three ways:
Increase Customers
Of all the activities a business will engage in, acquiring customers has the greatest cost attached to it. The process of getting a paying customer starts with finding the right prospects, getting them to become a lead and then eventually converting leads into paying customers.
In essence, this is what a sales funnel is (and a topic for another post!). Your job as a business owner is to create awareness of your products and services and then turn that awareness into leads and sales.
It can be a long and sometimes complicated process and involves a mix of content, paid, referral, social media and email marketing. As I said before, the most amount of money is spent in acquiring a customer…
However this creates a problem – one that you might be familiar with….
Unfortunately, there’s the assumption that doubling the traffic to your website will automatically double your sales – and that’s not true!
This is flawed thinking, and can mean thousands of pounds in wasted ad spend (I’ll talk more in depth about this in another blog post!).
Because increasing customers is where the most amount of effort, energy and money is spent, it’s therefore absolutely CRITICAL you market to the right people ALL the time. We’ll get to this in a moment.
Increasing The Average Order Frequency (AOF)
The average order frequency (AOF) simply means the number of times your customers bought from you in any given period.
Getting customers to repeatedly buy from you requires a mixture of having the right offerings that are of value to your ideal customer and then staying in front of them through various means of marketing.
Increasing The Average Order Value (AOV)
The average order value (AOV) is simply the average total of every order a customer places with you over a defined period of time. AOV is an important metric for online businesses because it drives key decisions such as advertising spend and product pricing.
Here’s the thing – in order for any business to scale and grow to its fullest potential, you need to increase the number of ideal customers you have, the AOV and the AOF.
But, there’s a fundamental truth in truly being able to make the kind of money you’ve always dreamed of, which very few people actually talk about and that’s this:
ALL three of these factors are fully DEPENDENT on how well you understand your customers. PERIOD.
Powerful and effective marketing can only happen when a business understands the audience they are serving – and more importantly, understands the challenges, pain points, desires, fears and frustrations of their target market.
Businesses that understand their ideal customer (also known as their customer avatar) in detail are the businesses that make the most amount of money AND create lifelong loyalty with their audience.
In fact, understanding your ideal customer is the difference between businesses that make 6 figures and businesses that make 7 or more figures a year.
It’s All About The Touchy-Feely!
You’ve heard of the saying ‘Customer is king’, and most people would associate that with how your treat and deal with your customers. But I’d like to throw something that’s equally as important into this mix and that’s the importance of feelings.
It’s all about how your customer feels. And no, this isn’t some wishy-washy statement!
A customer who feels you understand them, who feels valued and more importantly, feels as if you truly want to help them will always prefer to do business with you rather than your competitors.
Remember that in the online world, you’re literally one click away from your competitors. This is why understanding the needs of your ideal customer is mission critical to the success of your business.
Many businesses mistakenly think that the trick to scaling and growing is by pumping out more products and reaching more people… when in actual fact, if they just paid attention to WHO they are serving and placed the needs of their ideal customers first, they would grow at an accelerated rate.
Part of the problem is that it’s easy to become clinically detached and think of your customers as a number on a spreadsheet, another number on just a list…
So when you hear marketers harp on about how the money is in the list, it’s easy to assume this relates to the size of your list. However, this is far from the truth! In reality, the money is in the RELATIONSHIP you build with your list!
You can have an enormous list with extremely low engagement, meaning very little money… and you can equally have a tiny list which is hyper-responsive and buys everything you sell them. It’s ALL in how you nurture the relationship with your audience.
The needs of your ideal customer should be TOP PRIORITY and the driving force behind ALL of your marketing campaigns. In fact, ALL of your content, social media posts, lead magnets, tripwires, ad campaigns, sales funnels and everything in between should be 100% guided by the needs of your ideal customer.
Key business decisions such as offering new products and services and creating new marketing campaigns should NEVER be discussed in isolation without going back to your ideal customer and figuring out what they need BEFORE you start creating new offerings! The businesses that get this make the most amount of money!
What Happens If I Don’t Understand My Ideal Customer?
Simple – you’ll never make the kind of money you could be making. You’ll fail to inspire your customers to become lifelong raving fans of what you do. You’ll burn more of your hard-earned money on wasted ad spend that fails to converts. You’ll struggle with lower engagement and lower conversions in your sales campaigns.
Most businesses who fail to get their sales campaigns to convert feel the answer lies in some magic trick… some new marketing trick, tool or hack that other successful business owners are using…
When in actual fact, the underlying reason for their failure to convert clicks to their ads into paying customers is a lack of understanding about who your customer is.
Long term, these will compound and becomes detrimental to the growth of your business.
Time To Take Action
So now you know WHY it’s important to understand your ideal customer, the next step is to figure out who that ideal customer is. For some businesses, this process is easier than others. The more data you have, the easier it is to nail your ideal customer or avatar.
The big question is how do you figure out who you serve when you have no idea? Complete the exercise below to help you figure this out.
3 Ways To Figure Out Your Ideal Customer
Here’s three ways to work out who your ideal customer is:
- Take Stock Of Your Customer Base – Spend some time going through your customer lists. Are they predominantly male or female? Do they fall into a particular age bracket? Do you service a particular area? Are your customers educated? If so, how educated? Do they have families? Are they earning over a certain amount? Do they have kids? Write these down. You’re basically looking for patterns in the demographic information which makes it easier for you to identify your ideal customer.
- Survey Your List – Figure out who your customers are by asking the right questions. A simple survey to your list (offer an incentive to increase responses) is a great way to find out more about your target market. Use a tool like Surveymonkey or even Google Sheets to create and send surveys. If your business requires customers to create an account, you can simply add a simple form as part of the sign up process to get this information.
- Keep An Eye on Competitors – If you’re having a hard time figuring out who you serve, look at your more successful competitors. What kind of ads are they running? What kind of people are they attracting? A good way to do this is to look at their social media accounts – especially Facebook. Figure out who the majority of their fans are and you’ll get an idea of who your target market should also be.
TOP TIP – Focus only on the MAJORITY or around 80% of your customers, rather than getting caught up in the unique differences of every single customer. You’re looking for themes or patterns which are very obvious.
For example, if you’re a dog trainer, you know immediately that your target market is dog owners. They might be primarily female, in the 20-40 age bracket and have families. They may be living in your local area and have a large disposable income.
Once you’ve done this exercise, you should have a better and clearer picture of who your ideal customer is. You can use this information when running ads on platforms such as Facebook and ensure that you’re targeting your ads to the right group of people.
This one change alone will automatically make your ads more relevant, more targeted and will get you better results with your campaigns because the right people are seeing your offer.
Arfa Saira Iqbal
PS – Want to dramatically improve your marketing without increasing your ad spend? Then check out my latest course which takes you through the entire avatar process and teaches you how to use this information to build powerful marketing campaigns. Find out more here: AVATAR COURSE
