When you go into business you need a model for selecting your ideal customer. There are five considerations when applying this model as follows.
1 Adding value or solving problems
All businesses focus on adding value or solving problems. If your customer is price conscious you will focus more on adding value whereas if they have an issue to solve you focus on their problem.
2 Wants or needs
All customers purchases are either based on a want or a need. Selling pleasure is a want whereas selling car insurance is a need. Needs are sold to a logical part of the brain whereas wants are sold to the emotional part of the brain.
3 Products or services
On the whole products are standardised and will sell on the basis of quality against price whereas services are often more personal and sell based on human relationships. A product is a camera whereas a massage is a service.
4 Features or benefits
Features give the customer background and reinforcement about the product or service whereas benefits are what makes the sale. People spend money on how they will benefit from their purchase
5 Passive or Active income
Is your customer going to pay you for your time only or will they pay you when you are asleep. If they buy a product or service and get paid once, that is active income. If on the other hand they take out a subscription to a gym , providing you with a monthly income, regardless of whether they use it or not, that is passive income.
When going into business decide which of these dualities in one to five to focus on. It will help to distill the kind of customer to target and the your potential earning capacity as a consequence.
Peter Bull ( Author of the Get In Touch Series )