As a starting Knowledge Commerce Entrepreneur or one in tough economic times, you may think that you are happy with every customer that walks in the door. However, after working with a range of customers you could come to the conclusion that not all customers are created equal. Unless of course, you live in a perfect world, as a consultant or coach you have to be selective in choosing your customers. In this post, I discuss 9 criteria to find your ideal client.
Years ago – before Fluks existed and I was running my marketing agency/consultancy, I had a fascinating experience.
A strange experience
I was invited by a business owner with a really interesting and high-tech intelligent product, to talk about doing work for his business. I love complicated products as I know one of my strengths lies in making complicated products or services simple for the target audience.
The meeting in itself was friendly and engaging, but what was a bit disconcerting was that this business owner kept telling me not to take notes because he was writing it all down for me. He also told me several times that I didn’t have to understand the product for more than 40%.
Taking notes is important to me as I jot down questions and thoughts I have. It is my way of processing information. It wasn’t like I was taking dictation. (Besides, his handwriting was even worse than mine.) Understanding the product and what it does for the target market is crucial to me as a consultant, so I felt really confined by all these limitations.
The business owner wanted to build his brand and generate leads for his business and had set his mind on two ways of doing so. As a brand and marketing strategist, I thought there were better ways and I also wanted to improve the website in order to build the brand and generate leads. The website was off-limits, however.
On the way back from the meeting I found myself torn. On the one hand, I loved the smartness of the product and how successful it could be when marketed properly. On the other hand, I felt this guy wasn’t taking me, my expertise, and my way of working seriously.
In the end, I decided to send him a proposal about how I thought the marketing and branding of his business should be done; different from what he had asked.
It was a test of sorts. He either liked my independent thinking and valued my expertise and then we would be a good match, or he wouldn’t and he would go with one of the two competitors he had been talking with.
The business owner decided to go with another agency as our proposal didn’t offer what he was looking for.
He failed my test and I failed his. He wanted someone to do what he wanted. I by definition question everything I am told to do 😉
We would have been bad for each other.
What I learned from this is that I should trust my gut or intuition even more than I already did and that I should not have even bothered with the proposal. Apart from the learning experience, it was a waste of time.
So select your customers and use the following criteria to do so.
Valuing your work
By that I mean: do your customers appreciate what you do for them? Do they take your legal advice if you are a lawyer? Do they appreciate your accounting advice if you are an accountant? Do they like your suggestions for self-development if you are a coach?
This is important for two reasons. First of all, if your customers are happy and let you know, you are happy as a result. You derive personal satisfaction if the customer you did something for, appreciated and valued it. It is why you are in the business you are in. You are helping to solve a problem your customer has.
Secondly, happy customers say good things about you and this, in turn, helps you build your reputation and spreads the word to other potential customers. Word of mouth, after all, is the most effective marketing any business can have.
Thirdly, customers who do not value your work could have – will have – a counterproductive effect.
Let’s illustrate with an example. Say you are a consultant and you advise your client to solve a problem in a certain way. But he doesn’t listen to you and the problem isn’t solved but is even made worse. This not only is very frustrating for you as a consultant, but the wrong solution chosen may also rub off on your reputation as a consultant.
If your advice is not appreciated it will only lead to frustration for you and your team.
They fit within your business model and organizational processes
When I pivoted my agency to Fluks and started working with Knowledge Commerce Entrepreneurs right after this pivot I was referred to this wonderful client. I love the client. I loved the topic they taught.
In my business I work with English-speaking clients from all over the world and to help me with this, I have team members from all over the world. They all speak English.
For this particular client, we had to do everything in Dutch. This meant that for some of the work I had to find team members who speak Dutch. My English-speaking specialists could not do the work.
This resulted in:
- Having to spend extra time on finding suitable specialists.
- Having to pay more for Dutch-speaking specialists in turn led to the choice between decreased margins or doing the work myself. Both are not ideal!
- I could not offer the Dutch-speaking specialist more work as I did not want to focus on the Dutch market.
So even though this client was a great client it was hindering me in scaling my business as servicing this client cost me more time. Not the client’s fault, but simply an incompatibility with my business and organizational model.
Knowledge and skill level
Your contact person at the client’s organization needs to have certain knowledge and/or skill level to work with you. If they do not have the level needed to work with you, it will cost you extra time and the question is who is going to pay for this.
This may differ per type of business but let me give you some examples.
We create (course) websites for our clients and do online marketing for them. This requires a certain level of tech-savviness. Think about how to work with Google Workspace or Dropbox. Or how to upload a big file. Or how to give you access to their Google Analytics. Stuff like that. Not necessarily rocket science – we take care of that – but things to make working together run smoothly.
But it can also be on the organizational side. Like knowing how to manage the project from their side of the aisle. Lack of progress costs time and in the end money.
Teaching all that stuff to your clients seems like an easy offer to make, but it takes a lot of time. And again, who is going to pay for it?
Being paid on time
This may seem trivial, but it is an important one for several reasons.
Not only is it frustrating if customers do not pay on time. It also costs you time to go after your money. Time better spent on other things to grow your business.
Not being paid on time also denies you from using the money to either reinvest or put in an account that accrues interest.
A third reason why this is important is that customers not paying on time contribute hugely to businesses going bankrupt. You want to avoid that at all costs. So let go of the customers that do not pay on time.
No arguments about fees and prices
Although there is nothing wrong with a little negotiation, if it is not part of your business model because you have fixed prices, or if it happens every time with the same customer, you may have to wonder if this particular customer is worth the trouble. Because these negotiations take up a lot of time and also put their mark on the relationship.
It of course also ties in with valuing the work that you do for the customer. If they think your work is worth it, why argue about fees and prices?
Do your customers send other – good – customers your way?
If that is the case it means that your customer is actually being your salesperson out there. A good referral has a lot of value. And a customer who sends referrals your way is worth his weight in gold.
Repeat and frequency
Are your customers repeat buyers and do they buy often?
Granted, for some types of businesses, you may have a customer only once.
(Although that is another topic, think about creating other products or services, so that you get repeat customers who buy often.)
Of course, it is up to you to qualify how often, is frequent enough and how much you are happy with. That also depends on your business. If you are a strategy consultant it could mean that clients come to you a number of times once a year. If you are a weight-loss consultant working with morbidly obese people, every week may be your definition of often.
The fun factor
Do you actually enjoy having this customer?
The enjoyment can be based on the personal connection you have with someone, but also – depending on your business of course – if they have interesting stuff for you to work on.
In the case, I presented I really would have loved working on that product. Figuring it out and coming up with smart ways to market such an intelligent product would have been a party in itself.
Potential for growth
The last criterion is if your customer has potential for growth.
This goes for B2B as well as B2C; will your customers grow in such a way that it will generate more business for you?
One of the interesting things about the business owner I discussed at the beginning was that he had a product that had huge global growth potential. I was sorry to let that go.
Using these criteria
Of course, you have to adapt these criteria to your knowledge business.
How much potential for growth is enough? What is paying on time in your business?
Create your own yardstick and use it.
You can use this yardstick to evaluate your current clients.
It may lead to the insight that you will have to say goodbye to some of them. Even though it may hurt.
You can also use these criteria in your price setting or the development of your promotional plans.
You can also use this yardstick in the sales process. If you have to qualify leads for your sales funnel or make calls to prospects, these criteria may help you decide which may be worth your while and which are not.
We created a simple Google Doc form which you can simply access and copy, by clicking on the image below.