Using Technology to Define the Ideal Customer in SaaS
A recent client had incredible technology that allows agencies to connect their product information with a financial dashboard to show profitability. But the product wasn’t resonating as exciting as they thought it would with the market. So we went through the six core aspects of ideal customer isolation to ensure the right focus for the organization.
If you think about compression in a market, focusing on a geography is going to allow you to build a mini brand in a location because if all the customers that are similar start using your solution – they're all going to talk about it. They're all going to be raving fans and it's going allow you to expand. The way I think about it is like air pressure in a tire. It's really those last few pumps that give it the definition of the tire but it's all that focus and work of pumping up until that point.
That's what we want to do by nailing an ideal customer profile, so that you can actually start to make the job of marketing and sales easier for the entire organization. Below are the six aspects to giving your effort those last few pumps.
1. Firmographics – What industry are they in and what vertical do they specialize in? What's their revenue band right now? What is their percent of growth? Do you want to work with a company that's losing market share every year? No. Firmographics are the descriptive attributes of firms that can be used to aggregate individual firms and describe the full picture.
2. Demographic Traits – Think of the demographics of where your best customers hang out. For example, selling software to the music industry would have you focus on L.A. Selling to the financial industry would place you in New York or on Bay Street in Canada. So you've got to ask yourself where is the highest concentration of companies that I want to target. Selling farm software may direct you to the Midwest but understanding geography and the demographics is a huge filter of focus for you to go after your ideal customer.
3. Technology Stack – With Industry 4.0 upon us, everyone has a stack. Companies have H.R. Stacks, Sales Stacks, Workflow Stacks or some ERP Solution. If you look at your best customers they probably already use a certain technology stack. This is the cool part is today there's tools like Built With, a site that allows you to monitor and build a list of qualified leads of companies that are using certain technologies. There's other ones that can do internal technology adoption and the way they do that is they analyze the positions that are being posted from a recruiting point of view to see what kind of technologies they're asking that the candidates have experience in and then reverse engineering that for you. So technographic tools is a huge opportunity for you to really trim down 50 thousand potential customers into the best eight hundred for you to go after based on your solution and the technologies integrations your prospects have.
4. Psychographics – At the end of the day there are definitely mindset beliefs and values that people have, that if they have the wrong ones will make your job ridiculously hard to get them to adopt your product. You have to have the right attitudes and it's almost like the right attitude pulls your solution to them. Just think about like fixed mindset people versus growth mindset. Early adopters versus laggards. Now you might be thinking well how can I even validate that? It's not that you can validate it up front but you can definitely define it. My best customers, the people I love to work with the ones I get the best results for have these values and these belief systems. These are the things that are true about them. Just answer that question put it on the list and you'll be surprised how that will inform your sales people and you're marketing people to produce content that attracts the right people. This changes the dialogue to a conversation that qualifies the bad people or the bad prospects out of your list to make it way easier to have success in your solution.
5. Buyer Roles – If you target Mid-market or Enterprise customers there's going to be several people involved in buying. So you need to define the roles in the organization as you isolate and ideal customer. This will ensure that the marketing team or the salespeople are building the right connection and those relationships with the various people. You need to know your internal champions, economic buyer and all of those that will be adopting your solution. The complexity of sales right now is almost like there's always a group of people that are going be involved in making that decision. If you don't put the list of those roles from the company you've identified, then you won't be able to properly ask questions and qualifying those people to make the sales process easier.
6. Name your avatar. The last aspect is to name your ideal customer. An avatar name typically leverages the industry or vertical, combined with the role and then giving them a name that starts with the same letter. Hubspot is famous for Marketing Mary and I know that Amazon and all the top companies have an avatar they named them some of them put a physical object in a chair in a meeting room so that everybody knows that at the end of the day we're trying to serve that person.
So when you really want to push the limits of the size of deals and the size of customers that you can work with, based on the solution that you have today – you need to isolate your ideal customer.