Why You Need to Define Your Ideal Client
How many clients do you have? How many of them are your dream clients, your ideal clients? Ever wonder what it would be like to have a business built on only serving your ideal clients? You can. Not only can you focus solely on your ideal client, but your business is going to be a lot more profitable if you do.
If you know who your ideal client is, you know who to target in your copy, your designs, your emails, your brand colours, brand voice, and every aspect of your marketing. You need to know who to target because we can’t be everything to everybody. In fact, we don’t even want to be.
On average, our ideal clients account for only 20 percent of our business but 80 percent of our revenue. You may have heard this referred to before as the 80/20 Principle, or “the vital few.”
Imagine you do 10 shoots a month and that brings in $10,000 of revenue. If 20% of your clients account for 80% of your revenue, then that means 2 of those 10 clients account for $8,000 of revenue, or an average of $4,000 per client. So, if you stop serving the clients that only account for 20% of your revenue, and refocus that energy on getting more ideal clients, you can dramatically increase your revenue. Even if you stopped serving those eight low-revenue clients and replaced them with just one new ideal client, your revenue would increase from $10,000 to $12,000. You will increase your income while serving fewer clients who are more ideal for your business.
Now, let’s say you replaced all 8 of those low-revenue clients, who are not your ideal clients, who take up a lot of your time without generating much revenue for you, and you replace them with 8 new clients who are just like your high-revenue clients, then your revenue would jump from $10,000 a month to $40,000 a month.
This is the number one reason why you need to define your ideal client. When you know who the ideal client is for your business, and who the people are that provide you with the best return on your time, then you can start to double, triple, and quadruple your revenue. Once you realize the potential of establishing and knowing exactly who your ideal client is, it becomes so obvious that this is what we should be doing. This is why these are referred to as the vital few.
Know Who Is NOT Your Client
Another reason to define your ideal client is to also know your ideal client is not. Far too often I see photographers complaining that other photographers who charge $50 for a headshot or a half-hour family session are bringing down the whole industry, that it’s a price-cutting race to the bottom. This couldn’t be further from the truth. This is not an abundance mindset.
This kind of mindset is one that doesn’t understand that clients that are only willing (or even able) to pay for a $50 headshot or a family session are the exact same type of client who would pay $2000 for a personal branding session or $2,000 for a medium-sized canvas of their family for their wall. Cheap clients don’t bring down the whole industry, they only bring down your revenue. So get rid of them. Focus on clients who you are ideally suited to serve and who are ideally suited to what you provide.
Take a look at your business. Run a report in Sprout Studio or your own CRM and take a look at your numbers. Where does most of your revenue come from? Who are your highest revenue clients? What products or services are your lowest revenue generators? Who are your lowest revenue clients? Identify the winners and losers in your service menu and get rid of the rest. Focus on the winners. This is how you build a successful business.
I want to take a minute here to also say that if the thing that’s making you the most money is the thing that you like doing the least, you might need to rethink your whole brand strategy. Something is out of alignment and you need to make sure you love what you do, or you’re going to resent all of your clients, even the ones that are paying you boatloads of money. If you hate what you’re doing, stop doing it.
I know niching down feels like you’re limiting yourself, but remember the 80/20 Principle, and understand that the only limiting you is your belief that you cannot make more and do better by only serving the vital few.
Marcus Lemonis, The Profit
I want to recommend a TV show called The Profit. I’ve been watching it since it first aired in 2013 and I’ve seen every single episode. Many of them more than once. It’s a business reality show with a financial investor by the name of Marcus Lemonis who buys into failing businesses and helps to turn them around. Marcus has created, and just released last week, a completely free online business school. Totally free and totally awesome. I’m a big fan and I think you will be, too.
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