Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.
Let’s put aside the idea of how many different stages there are in a sales funnel for a moment. In the next couple of chapters, I’ll show you why that part of the discussion is actually irrelevant. (Well, maybe not irrelevant but way less important than one might think if you spend any time researching sales funnels).
Let’s put aside the concept of stages and let’s instead talk about your target market. That’s really where it starts.
Your target market is the group of people that you want to sell your products or services to. They are the people who you will be marketing to – the people who will be cascading in droves into the very top of your sales funnel.
When I ask business owners who their target market is, I’m often alarmed with answers like “everyone” and “anyone”. This isn’t true at all; and, in fact, that kind of mindset is actually harmful to your business.
There are six billion people on the planet (give or take a couple who were maybe not counted because they were in Antarctica at the time and the census people thought it was too cold to go there and count heads). Surely you don’t think that all six billion of those people are likely to buy from you, right? There’s a big group of them who are possibly too young to buy from you… or even use the potty. There’s a gigantic group of people who can barely scrape together a couple of cents to pay for a meal for their family so surely they won’t be able to buy from you either. And let’s subtract the big group of people who only speak Mandarin or Cantonese – no English – so unless you’ve translated your website into those languages (or any of the other languages that people speak if they can’t speak English) then they are out. Do you sell online? Then scratch anyone who doesn’t have internet access or an ability to transmit money online. Do you sell in physical locations? Then scratch anyone who can’t walk, cycle, take the bus, or drive to your stores.
Your target market is quickly diminishing… And I’ve only just started.
By now, though, I hope you’ve realized that “everyone” and “anyone” is not your target market. Rather, your target market is a group of people who have a problem or need that your offering solves or fulfills, and they have the money to pay for it and the ability to access/download/acquire your product or service and put it to use. That dramatically cuts your target market from six billion people down to a much smaller number.
Fortunately, that much smaller number is way better to have! When you try to reach a target market of “everyone” or “anyone” then your marketing and sales efforts try to speak to everyone and anyone. As a result, it won’t be impactful enough so it will speak to no one. However, when you identify a narrowly defined target market and you know them extremely well, you can deploy far more effective marketing and sales efforts because you can speak clearly to that market.
So how do you define your target market?
If you’ve been in business already then the answer is easy: Your ideal target market is defined in the same way that you would describe your very best, most profitable customer. Think of your favorite customer – the one you really connected with, the one you love to serve, the one you made the most money from. They are the perfect, most profitable customer; the ones who buy frequently and become your biggest fans and loudest referrals sources, sending scores of people just like themselves to your business.
Got that customer (or group of customers) in your mind? Good. Now describe the qualities they have in common that are not shared by your other customers (the less-profitable, less-favored) customers. Those qualities are the ones that make up your target market.
Here’s an example: When I first started freelance writing, I took jobs from any client I could – partly because I needed the work and partly because I hadn’t clearly defined who my target market was at that point. But after a couple of years, I did the exact exercise I described above and guess what I found. I’d enjoyed many different projects with many different clients, in businesses of multiple sizes and from a variety of industries. But my very best, most profitable clients – the ones who I loved to work with the most – were financial and real estate professionals (including educators, investors, and advisors).
I changed my marketing to focus exclusively on them, and ramped up my services (and knowledge!) to provide better service just to them. (Plus, the added specialization allowed me to increase my prices). Sure, I ended up with other types of clients from time to time but I had a focus on a particular target market and it made a massive difference in my business.
But not everyone has the advantage of being in business and choosing from their best customers as their ideal market. If you are just starting your business and haven’t yet served any customers, then I would recommend the following: Choose a target market that most acutely feels the problem or need that your offering solves or fulfills. And if possible, choose a target market that is similar to you.
There are other ways to more narrowly define your market beyond being your most profitable customer or their felt-need or their similarity to you. You might also narrow your market by location, sales-potential, profit-potential, referral potential, how easy it is to serve them, or many other factors.
The very first thing you need to do is to narrow your potential target market to a definable group of people who share similar characteristics and whose problem or need you can address with your product or service.
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.