Thursday, February 25, 2010

Wanted Buyers vs. Actual Buyers

Many of you are often asked: "So, who is your ideal customer?"  In other words, who do you want to buy your product?

I have a staple answer for that as well for PeerFX - small businesses that have less than 10 employees, less than $10 million in revenues, and are growing international revenues with recurring monthly foreign currency transactions for receivables and payables.

Great, this is the ideal customer - I would be really happy if each and every customer knocking on our door fit this profile.

In reality, we get another type of customer at the beginning; I say at the beginning because the ideal customer comes when you build enough credibility, features and volume in your business.

Right now our customers are split 50/50 between individuals and small businesses that aren't at the $10M revenue mark. 

So for those of you that are writing a business plan, and defining your target segment, you need to think about how long it will take you to create something that will attract and keep your ideal customers.  Be realistic and accept the fact that you will need a slightly not as ideal batch of customers to help you prove your case in the beginning.  This doesn't only apply to running or wanting to start a large business.  For example, a marketing consultant starting out has an ideal customer in mind that needs different marketing campaigns each quarter and pays at least $10,000 for each of them; does this usually happen right away?  Probably not, the consultant is building his/her portfolio of customers with the smaller accounts first before they gain enough history and experience under their belt to approach the bigger accounts.

Think about this for your own business - I'm thinking about it right now as today's my down time for some strategy implementation (not just planning!!!) :)

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