If I were to ask you to describe your best prospect, how would you answer? If you sell to consumers, do you know your prime demographic? If you sell B2B, can you describe your target customer in terms of size, industry or some other factor?
Whatever you do, please don't tell me you sell to "everyone."
Many entrepreneurs buy into the myth that the bigger their market, the greater the opportunity. The fact is, the bigger your market, the greater the likelihood you're wasting your time with undesirable prospects.
When you're in business for yourself, you have to work smart. You don't have the time or resources to sell to everyone. The more you can define--and refine--your target customer, the better you can concentrate, and therefore maximize, your sales efforts.
Identify Your Best Prospects
If you don't already know who your target prospect is, ask yourself "Who is most likely to buy my product or service? Who will appreciate the value of what I have to offer?" And if you're still not sure who your target market is, you may find the answer in your current customer base.
Make a list of your top 10 customers. You know who they are. Then, think about what it is they have in common. If the answer isn't obvious, look beneath the surface. For example, maybe your B2B customers work in different industries but share common priorities or a similar work flow. Once you figure out what the common denominator is, you can use it to identify your best sales prospects.
Take this exercise one step further. For each customer, identify why they buy from you. Is it something unique about your products? Is it your speedy turnaround time? Some facet of service you provide? Now not only do you know who your prime customer is, you know what your unique selling proposition should be.
Here's an example: I know an entrepreneur, John, who sells boxes. One of his bestsellers is a tall, wardrobe-style box with a bar for hanging clothing. The box is a favorite with moving companies. However, John began selling these boxes to a menswear store. Then to another. And somewhere along the way, he became a bit of a specialist. Realizing he had something to offer, he began to concentrate his sales and marketing efforts on menswear stores. Instead of trying to reach the entire universe of "companies that need boxes," he's targeting his efforts to the menswear industry--a group that has already demonstrated a need for his products.
Target Current Customers, Too
For most entrepreneurs, getting repeat sales from current customers is essential. But not all customers are created equal. You know who your A-list customers are. And I bet you could just as quickly name those whom you'd assign an F.
And I'll hazard a guess that you're actually spending more time and energy on your F-level customers. Whether you're conscious of it or not, that's one reason you assigned them a failing grade. The squeaky wheel most often gets the oil--but when you're the one filling the oil can, it pays to give this some thought.
Let's go back to your list of A-level customers. Now identify why they scored an A. Do they order more? Buy your most profitable products? Always pay promptly? Are they easiest to deal with? It may very well be a combination of factors, but these are the factors that are most important to you. These customers deserve your best, most attentive service because you want to keep them around.
If you're like most entrepreneurs, time is your most valuable asset. Accounts that require constant handholding or habitually pay late are costing you money in lost opportunities. Stop bending over backwards for them. If they go away, you'll be better off.
Similarly, when you're prospecting, wooing customers outside your target market is simply less profitable. You're less likely to get their business, and you may not want it once you get it.
The moral of this story is, you can't sell to everyone. Nor should you try to. When it comes to targeting prospects, less is truly more.
Ray Silverstein is the president of PRO: President's Resource Organization , a network of peer advisory boards for small business owners. He is author of two books: The Best Secrets of Great Small Businesses and the new Small Business Survival Guide: How to Survive (and Thrive) in Tough Times . He can be reached at 1-800-818-0150 or firstname.lastname@example.org .