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In business, especially when it comes to sales, there’s a lot of talk around ideal customers. But what exactly does that mean? Most people usually only look at their target market or ideal customer at a very surface level.
In this Ultimate Guide, we’ll discuss what an ideal customer is, how to know who your ideal customers are in-depth, how you find those ideal customers, and how to create a unique selling proposition to get them buying like crazy.
What is an Ideal Customer?
Your ideal customer can be defined as the target market that you need to attract to succeed and grow your business. Reaching these ideal customers will typically require a product or service that solves a specific problem or meets a specific need.
It’s important to identify what those problems and/or needs are if you hope to expand your clientele and reach more potential customers. But it’s not just about the product; it’s also crucial to identify key characteristics of your ideal customer so that you can easily find similar potential customers.
New York Times best-selling author Ramit Sethi said it best: “Algorithms change. Tactics change. But the fundamentals of learning what people want, seeing exactly where you can help them, and then telling the right people about it (emphasis mine) are classic strategies that worked 1,000 years ago and will work 1,000 years from now.”
How to Define Your Ideal Customer
So, who is your ideal customer? What problem does your product or service solve? What need does it fill? Who would benefit from your product or service the most? Where can you reach those specific people? And one of the most important questions to ask yourself: Who would pay money for what you have to offer? It’s a lot to consider! To make the ideal customer identification process simpler, we’ve broken it down into three stages: PAM.
Pain – has a specific need that your product or service can fulfill
Access – is an audience large enough to be reached & knowing where to reach them
Money – has enough money to purchase a solution for their problem
Pain is an important word here. We aren’t necessarily talking about physical pain. And this kind of ideal customer pain is different from just wanting something. There’s something going on that is causing enough frustration, annoyance, discomfort, or disruption that the person is willing to spend money to get relief from the pain (a solution).
If it’s just a minor concern, people aren’t going to be as likely to spend money, but if it’s something that would improve their life in a significant way, that’s the sweet spot. What pain is plaguing your ideal customer every day? Is it something they need to learn? A tool or solution to make something they must do easier?
Access encompasses two different things: how many potential customers there are and where you can find them. You may have an excellent product but if your target market is so narrow that only a handful of people would qualify as ideal customers…well it’s going to be challenging to access that small of an audience.
There are exceptions of course, like if your audience is really small but super fanatical and easily found congregating somewhere like an online forum. This brings us to the other part of access – where to find your ideal customers.
For this step, we want to think back to the pain criteria above. Who are the people experiencing that pain, and where can they be found? Are they young people who congregate on TikTok and Snapchat? Are they middle-aged women that use Facebook every day? Maybe they are avid Twitter users or Pinterest junkies. No matter who they are, having easy access to where they already are is crucial.
Show Me The Money
Money is the final piece of the ideal customer puzzle. If you’re selling a premium product for $49 or even $99, it’s important that you identify the right customer for that price point. Odds are, they are going to follow middle-tier brands like Target or Bed Bath and Beyond, as opposed to bargain brands like Dollar Tree or Walmart. Think about the kinds of places your ideal customer would spend money and use that in your customer personas and targeting. The same is true for lower-priced products in the $5-20 range that have an upsell on the backend – you want to be sure that the people you are targeting have the money to buy!
Once you’ve determined your ideal customer, it can be helpful to create a customer persona. Customer personas are detailed descriptions of your ideal customer that include specifics about their lifestyle (see example below). Personas (also known as avatars) can be incredibly useful when brainstorming ways to reach your audience, determining price points, and coming up with ideas for new products. It’s a lot easier to ask yourself if your customer persona Sarah would like this product than to try and determine whether women aged 18-24 would like this product.
Customer Persona Example (from Iron Springs Design)
Before we get into how to find your ideal customer, we want to remind you to use your most valuable resource – your existing customer list! Talking to your existing customers and finding out who they are and why they purchased your product is an excellent way to define your ideal customer. After all, these individuals have already demonstrated all three of the PAM characteristics above!
Learn How to Find Your Ideal Customer
We touched on this above in the PAM exercise, but let’s dig in a bit more, shall we? Most businesses start with social media when trying to determine where best to reach their ideal audience. This makes sense, considering the fact that more than half of the world’s population uses social media! But which platform(s) should you focus on? It depends on who you are trying to reach. To help you determine which social media platforms are best for reaching which groups of people, we’ve included some demographics below for you of the most popular social media platforms today.
Despite all the controversy, Facebook is still the most-used and most-engaged-with platform. Even though their largest user group falls in the 25-34 age range, Facebook is one of the best places to reach Baby Boomers and senior citizens.
Largest age group – 25-34 (26.3% of users)
Gender breakdown – 44% female 56% male
Average time spent per day – 38 minutes
In recent months, Instagram has been overshadowed by TikTok (especially for younger audiences), but it still comes in as the second-largest social media platform after Facebook. It’s also a well-documented fact that Instagram users are motivated shoppers!
Largest age group – 25-34 (33.1% of users)
Gender breakdown – 57% female 43% male
Average time spent per day – 29 minutes
If you are aiming to reach middle-aged men, Twitter is a must for your marketing! Twitter users are also more likely to hold a degree (42% of users) so if your ideal customer is well-educated, definitely don’t skip out on promoting via Twitter.
Largest age group – 30-49 (44% of users)
Gender breakdown – 32% female 68% male
Average time spent per session – 3.53 minutes
Older audiences may make up most of LinkedIn’s user base, but if your ideal customer is a millennial, don’t overlook LinkedIn as a source of new customers. One-fourth of LinkedIn’s users are millennials. LinkedIn’s platform also sees a higher level of education and higher income brackets among its users. One big thing to keep in mind is that more than 70% of LinkedIn users reside outside of the United States, which is fantastic for businesses trying to reach their ideal customers internationally.
Largest age group – 46-55
Gender breakdown – 49% female 51% male
Frequency of use – 22% of users log in weekly 63% of users log in monthly
Pinterest has the largest percentage of female users compared to any other social media platform. It’s a heavily product-focused platform with massive opportunities to sell to its high-earning user base. Recently there has been a marked increase in usage among Gen Z and millennials, so don’t let the dominant 40-49 age group fool you!
Largest age group – 40-49
Gender breakdown – 78% female 22% male
Average time spent per day – 14.2 minutes
TikTok’s user base may be younger, but millions of older users have flocked to the platform in recent months. In fact, more than 57% of TikTokers fall in the 25-54 age range. But what’s really unique about TikTok is the dedication of its audience – TikTokers spent an average of 21.5 hours a month on the platform in 2020. That’s almost an hour a day!
Largest age group – 18-24 (27.5%)
Gender breakdown – 59% female 41% male
Average time spent per day – 45+ minutes
We don’t hear as much about Snapchat these days, but it’s still a booming platform when it comes to younger audiences. Users are highly engaged and open the app on average more than 30 times a day! Even if your ideal customer doesn’t fall into the younger Snapchat audience, it’s an excellent platform for trendspotting. So, if your ideal customer cares about social status and being up on current trends, Snapchat may be a place to reach them!
Largest age group – 13-34 (75%)
Gender breakdown – 58% female 40% male
Average time spent per day – 26 minutes
Don’t let the large younger user base scare you away; more than 60% of YouTube users log in every day to the platform. Considering the fact that 72% of all internet users are on YouTube…well that’s a LOT of potential customer eyeballs of all ages. Whether you are creating new content or running paid advertising, YouTube is a powerful tool for sharing your products and messaging with the world.
Largest age group – 15-25
Gender breakdown – 72% of all internet users use YouTube (both male and female)
Average time spent per day – 41.9 minutes (among viewers 18+)
Another great way to find your ideal customer is to look for other businesses, experts, influencers, etc. that reach a similar target market as you. After you’ve defined who your ideal customer is, think about the brands and websites they would be fans of. Pay attention to who is promoting what on social media and reach out to relevant individuals and businesses to explain your product and offer a partnership or affiliate relationship.
But what if you are brand-spankin’ new to the business and don’t have an existing audience to rely on for determining who your target audience is? That’s totally okay! Remember the saying, “If you build it, they will come,”? Well, this is more like, “If you build it for them, they will come.” It may seem kind of backward but defining an ideal customer first and then creating a product or service that solves their pain problem is a tried-and-true way of doing business. Who wouldn’t love a solution that’s custom-created specifically for them?!
One great way to get started with this approach is to define your ideal customer and then research existing products and companies in the niche you have chosen. Take the time to read customer reviews, concerns, comments, complaints, etc. on social media, website forums, private groups, wherever those ideal customers interact online. Then it’s as easy as creating a product that solves the most common complaints you find. After all, you already know exactly who your ideal audience is and where to find them!
Finding your ideal customer all comes down to getting to know them – who they are, what their life is like, what their pain is, and what they value most.
Employ the Ideal Price Points
Price is much more than just a dollar amount. It can drive the demand for a product and convey value and quality. Price can also be a factor in determining who your ideal audience is. What message does your price point send? Are your prices geared towards more budget-sensitive buyers? Are your prices a little higher to target convenience-focused customers? Maybe your prices are a lot higher in order to pinpoint those customers for whom status is important.
So, how do you pick the right price for your product? Many businesses base their pricing strategy on their competition. They see what everyone else is charging and choose a number somewhere in the middle, in order to seem competitive yet affordable. However, successful pricing strategies should be based on several factors, not just market prices. Here are a few more things to consider:
- What your ideal customer is willing to pay (market prices)
- How your company and product are perceived
- The volume of products available
- The costs involved with creating your product
Remember, your pricing sends a message. Setting your price too low when your ideal customer has a penchant for expensive goods will turn them away. Setting the price too high when your ideal customer is budget sensitive will result in fewer sales. Going back to your customer persona, when setting prices ask yourself, “Would Sarah Student think this is a fair price for this product/service?”
Leverage Your Unique Selling Proposition
No two businesses are the same, even if they sell almost identical products. The uniqueness of your business is what sets you apart from the competition. But don’t be fooled into thinking the uniqueness is about you or even your business because it’s not. Unique Selling Propositions (USPs) are based on two factors: exclusivity and desirability.
Now, what does that mean exactly? Let’s say, for example, that you are one of a set of quadruplets. That would certainly fall under exclusivity because it’s highly unlikely another business owner could say the same about themselves.
However, that alone is not a USP because it lacks the other half of the equation: desirability. As unique to you as that trait may be, it doesn’t necessarily cause your product or service to be more desirable to potential customers. It may make you stand out and easier to remember if you include it as part of your branding in some way, but it doesn’t offer a benefit to the customer.
The key to a strong USP is to have a benefit that is exclusive to your business and desirable to your ideal customer. In short, your USP should be able to answer the question, “Why should your ideal customer choose you over the competition?” in 1-2 direct-to-the-point sentences.
How to Create Your USP
Now that you know more about what exactly a Unique Selling Proposition is, let’s talk about how to create a USP that attracts your ideal customer. By this point in the process, you should at least have an ideal customer defined, even if you don’t have a product created. Many creators will wait to create their finished product or service until after they’ve defined their USP so that they can ensure their product really does live up to (and hopefully exceed!) customer expectations.
Creating a USP is really quite simple. What does your ideal customer want or need most in a pain solution? What is no one else out there offering them? In what areas does the competition fall flat (remember we mentioned reading comments and reviews from buyers of products/services from similar companies)?
Take some time to do a little bit of competitive research and see what other businesses are touting as their USP before you begin creating your own. Listen in on what your ideal customers are saying in online forums and on social media. What unique benefit can you offer that would really blow their socks off and make them pull out their wallet?
Growing With Your Ideal Customer
Creating products and services that buyers flock to may seem like a pipe dream, but it’s actually much easier than you might think if you take the time to do the groundwork necessary. This starts with determining who your ideal customers are, what they want and need, and where you can find them. Don’t skip these steps and you’ll be well on your way to growing your business into something amazing.