Selecting & securing profitable customers

By Pavlo Phitidis

Knowing how to focus your sales efforts on the most profitable customers can accelerate the growth of your business exponentially. It is a critical exercise because, with limited resources on hand, you need to focus your efforts, to maximise your impact and build your business’ momentum. On this week’s The Money Show with Bruce Whitfield, we outlined a useful technique for positioning your business:

Know Your Customer

As the owner of a growing business, you may feel tempted to try and be everything to everyone. This impulse is rooted in wanting to generate an income as quickly as possible, but it’s never a good idea to try and solve every problem, for every potential customer that comes your way. Finding, and knowing, the customer that you are best suited to serve, and who would be most profitable for your business, is vital. 

A Technique for Positioning Your Business

We used this technique with a group of technology entrepreneurs and, through it, you’ll be well equipped to find the right kind of customer for your business, and solve their specific problems. This technique will help you to build your business to be customer-centric, rather than product-centric, by positioning your business correctly. To showcase this technique, we’ll focus on the product of a tin of baked beans. 

1. Understand the essence of your product or service

Undertaking an in-depth analysis of your product will help you to better understand and define its capabilities and suitability for customer groups. Create a brief, feature-filled definition of your product, isolating what it can and cannot do, what it looks like and how it works. If we look at a tin of baked beans, we may ask the following questions: What does the tin look like? How many beans are in each tin? What do these baked beans taste like? 

2. Define the groups of customers you could serve

Once you understand your product, look towards discovering the types of customers it can serve. Define who the people are that your product can serve, by detailing their demographics; lifestyle; likes; dislikes, and needs. We’ve outlined four definitive customer groups who may enjoy or eat our tin of baked beans: 

  1. A mom with 6 kids
  2. A competitive athlete
  3. A busy business executive
  4. An artisan worker

3. Understand the problems that they experience that you can solve

Each of your defined customer groups will have unique problems they face, that your product could solve. These are some of the unique problems each of our chosen customer groups may face:

  1. Mom: needs our tin of baked beans to stretch as far as possible, and for it to be easy to use when her children are hungry. 
  2. Athlete: needs a healthy, high-protein meal, that has muscle building capabilities. 
  3. Business Executive: needs a convenient, on-the-go meal that’s nutritious and easy to make. 
  4. Worker/Labourer: needs a filling, hearty, energy-boosting meal.

 4. Plot your customer groups onto a matrix

Plotting your customer groups onto a matrix may sound complex, but it’s really a simple, four-block graph, that helps you to define your most profitable customer group. You’ll assign your customer groups into each quadrant by showing which group:

Has high or low profitability: Which of these customer groups can I serve immediately, with the product I have right now? How useful is my product to them? 

Has a few, or many, members: How many of these customers are out there? 

Through this, you’ll discover your ideal customer: the most reachable and most immediately profitable customer will be in the top right quadrant. For our tin of baked beans, that turns out to be the Business Executive. 

5. Craft your marketing and sales messages to focus on the top right quadrant

You can now focus your marketing strategy and messaging on your most profitable customer group, and find ways to communicate with them, in line with your business positioning. 

6. Be disciplined, focus and persist

Focus most of your marketing effort and budget on your most profitable customer groups, and remember that persistence is the key to momentum. Wealth, and the development of a successful business, is a cumulative exercise and not an overnight task. Once you’ve established a solid marketing effort that focuses on your ideal customer, you can look at apportioning some marketing effort towards the other customer groups, and perhaps even think about new product developments that may serve them best. 

Do you need help with figuring out your ideal customer is, or positioning your business correctly? Aurik can assist, as we work alongside you to build your business into an Asset of Value. 

 

Tags: Asset of Value, Sales, Strategy, Positioning your Business

Foresight and action can turn the potential sales you book in 2018 a certainty in 2019
The Money Show Sales

Foresight and action can turn the potential sales you book in 2018 a certainty in 2019

You’re winding down towards the end of 2018, and preparing to lock and load the early sales for 2019. If you’re not in this...

Read more

Turn 2018’s Exhaustion into 2019’s Business Acceleration
The Money Show Business Growth

Turn 2018’s Exhaustion into 2019’s Business Acceleration

Year-end fatigue is setting in - 2018 has been a tough year emotionally, economically, and physically. But that’s not much...

Read more

Building a Branch Network for Your Business
The Money Show Asset of Value Business Growth

Building a Branch Network for Your Business

Building a branch network for your business is still relevant and appropriate, despite the exponential growth opportunities...

Read more

Growing Revenues through Indirect Sales Channels
The Money Show Business Growth Sales channels

Growing Revenues through Indirect Sales Channels

Effectively growing your business revenue needs a lot more than just a regular sales effort. Developing and implementing...

Read more

Entering, Surviving, and Thriving, in a New Industry Created by New Technologies
The Money Show Business Growth Strategic Planning

Entering, Surviving, and Thriving, in a New Industry Created by New Technologies

We’re in the midst of the 4th industrial revolution, with many new technologies quickly entering the business environment....

Read more

Business Funding: How to Self-Fund your Business through its Lifecycle
The Money Show Business funding

Business Funding: How to Self-Fund your Business through its Lifecycle

Business owners and entrepreneurs often express the difficulty of accessing business funding as a key challenge. And yet,...

Read more

Building a business with confidence amidst uncertainty
The Money Show Business Growth Business owner

Building a business with confidence amidst uncertainty

A constantly changing business environment demands that business owners develop new skills to ensure business growth. Recently,...

Read more

Choose your Business Growth Rate and Build your Business Towards It
The Money Show Business Growth

Choose your Business Growth Rate and Build your Business Towards It

We may be living in a negative economic cycle right now, but it’s up to you to decide what your business growth rate should...

Read more

How to Build your Business & Capitalise on a Seemingly Negative Business Environment
The Money Show Building your Business

How to Build your Business & Capitalise on a Seemingly Negative Business Environment

The reality of a recession is sinking in, and it seems the echo chamber of negativity is overwhelming. South Africa’s business...

Read more

How to build a resilient business in a technical recession
Building your Business

How to build a resilient business in a technical recession

Our economy is in the midst of a technical recession and business owners are wondering how to weather this economic storm....

Read more

Marketing for Business Growth: Keeping your Customer Acquisition Cost in check
The Money Show Business Growth

Marketing for Business Growth: Keeping your Customer Acquisition Cost in check

You’re not alone. It’s becoming more and more difficult to generate leads, turn those into customers, and grow your revenue....

Read more

Product businesses in the industrial sector need to build differently to survive and thrive
Building your Business Business Growth

Product businesses in the industrial sector need to build differently to survive and thrive

Keeping water flowing through the kilometres of underground pipes keeps all players in water infrastructure awake at night,...

Read more

How to Build Your Business by recruiting the Right People to do the Right Thing at the Right Time.
The Money Show Building your Business

How to Build Your Business by recruiting the Right People to do the Right Thing at the Right Time.

As a small business owner, your biggest investment will be your staff. How you hire, who you hire, and when you hire, will...

Read more

Turning the talk of your Business Strategy into the Walk of Execution and Results
The Money Show Business Strategy

Turning the talk of your Business Strategy into the Walk of Execution and Results

In recent meetings with frustrated business owners, Pavlo Phitidis picked up on a significant trend – a high level of complaints...

Read more

Why, When and How to Sell your Business.
The Money Show Selling your business

Why, When and How to Sell your Business.

Every business only has two destinations: it closes, or you successfully sell it. Globally, however, 94.6% of all businesses...

Read more

How to build your business through delegation
The Money Show Business Growth

How to build your business through delegation

Your business journey most often begins with just you. Along the way, however, as you figure out how to build your business,...

Read more

Managing Business Growth – The Killers of Business Growth
The Money Show Business Growth

Managing Business Growth – The Killers of Business Growth

Ask any business owner what they’d like for their business, and they’ll say “Growth”. But managing business growth isn’t...

Read more

KVD: A fisherman’s tale
Building your Business Business Growth

KVD: A fisherman’s tale

American Kevin VanDam is one of the top-ranking bass fishermen in the world with two Major League Fishing Cups, four Bassmaster...

Read more

How to build your business: Break it to build it throughout the growth cycle
The Money Show Building your Business

How to build your business: Break it to build it throughout the growth cycle

You build your business within the context of your business environment. When your business environment changes more rapidly...

Read more

More small business growth insights from GrowCo
The Money Show Business Growth

More small business growth insights from GrowCo

On The Money Show with Bruce Whitfield, Pavlo Phitidis shared further small business growth insights, gleaned from attending...

Read more

Learning lessons from the GrowCo conference

Learning lessons from the GrowCo conference

GrowCo gives attendees the opportunity to learn from the best in the industry with more than 600 people attending – including...

Read more

Reflections on Small Business Growth from GrowCo
The Money Show Business Growth

Reflections on Small Business Growth from GrowCo

On The Money Show With Bruce Whitfield, Pavlo Phitidis shares what he learnt about small business growth, scale, competition,...

Read more

Characteristics of a business owner’s spouse can  be make or break
Asset of Value Business Development Family Business

Characteristics of a business owner’s spouse can be make or break

What’s it like to be the significant other or the spouse of a business owner? People generally believe that when you are...

Read more

Turning a sweet start into a smart start: Making money from honey with your start up business
Business Opportunities The Money Show Start Up

Turning a sweet start into a smart start: Making money from honey with your start up business

What happens when your small side business suddenly shows a whole bunch of potential? How do you turn a hobby into the startup...

Read more