078 – Ask the Expert – Finding Your Target Audience Transcript

Dusey Van Dusen: Hello, listeners. This is Dusey Van Dusen, producer of the Small Business Success Podcast, and we’ve got a couple of special guests for you today, as always. First of all, Ben Snedeker. Ben, how’s it going?

Ben Snedeker: Fine, thank you. Nice to be here.

Dusey Van Dusen: Ben is our content-comma-manager, as you’ve heard in a previous episode. It’s good to have you on again, Ben.

Ben Snedeker: Thank you. Thank you for having me.

Dusey Van Dusen: And then [00:00:30] we have brought on another special guest, Matt Vosburgh, a partner trainer here at Infusionsoft. How’s it going, Matt?

Matt Vosburgh: Awesome. Always awesome.

Dusey Van Dusen: Great to have you on. Could you tell us a little bit about what you do?

Matt Vosburgh: Yeah, so I’m with the Training, Certification, and Onboarding team for our partners. We have certified partners who sell and service Infusionsoft for our customers, provide specialized services, and we help train them and get them certified, and make sure they meet our requirements in order to do that job. So, get [00:01:00] to work with some amazing, extremely talented experts every day.

Dusey Van Dusen: That’s fantastic. So, in part of that training is … You know, it’s not just like software training, right? It’s training our partners how to work with small businesses, and how to ensure that their clients are successful, right?

Matt Vosburgh: Yeah, a big part of everything we do here at Infusionsoft revolves around Small Business Success Method, right, SBSM, and so we ingrain that into everything [00:01:30] we do. Everything we talk about is all about getting that focus that SBSM helps you do.

Dusey Van Dusen: Cool. So, as … One of the first things, one of the first parts of getting into SBSM is starting to identify your target market, who your audience is, who you’re speaking to, how to speak to them. And Matt and I were chatting earlier, and the method of which we go about doing this, I thought was pretty interesting and powerful, so maybe you can just dive right in and kind of get us started. Like, where would you start with somebody that’s saying, ” [00:02:00] Okay, I need to take a look at my business and make sure I’m doing things right?”

Matt Vosburgh: Yeah. Yeah, and I think the important thing here is that you don’t just, like, take my word for it, or anybody else’s word for it as to why you would want to get focused and specific around a market segment first. I think it’s really important for you to understand why you would want to do that first, and why it’s important, so that it really resonates with you, and then you can understand why you’re going to do these things that we’re going to talk [00:02:30] about today. But yeah, diving right into it, there’s … I think it was Tim Ferriss who said, “If you’re selling to everybody, you’re selling to nobody.”

Ben Snedeker: Right.

Matt Vosburgh: Right, and so having that focused, focused message, so that when people hear your message, they realize, they recognize that you’re talking to them, and that you understand them.

Ben Snedeker: Yeah, so a good example is if I’m a small business selling t-shirts [00:03:00] online, in a way, I might not necessarily know who I’m selling to. I’m just saying, “If you like t-shirts, buy my t-shirts.” But maybe there’s a better way to target those people in my advertising or in my social media, but I’m not sure how. So what are some ways that a small-business owner like me would know who’s the right person to sell to?

Matt Vosburgh: Yeah. So, we get this question all the time, and this is one of the things we help our partners [00:03:30] with, is getting focused on who they want to work with, who they should be working with, and how they’re going to craft that message. Let me, before … I never give a direct answer ever, so there’s going to be plenty of that here today. But part of the value of this is that so many small businesses, like you and your t-shirt business, are spending way too much time working with the wrong customers, and what that [00:04:00] means is that you’re not making as much money as you should be, you’re not as profitable as you should be, you’re not enjoying the time that you’re working in your business. Your employees are probably not real happy with the customers they’re having to interact with, because there’s not that alignment.

The example you give, t-shirts, is a fairly simple example, but the problem, when you’re not clear on who you want to work with, who you want to sell to, that … All you’re doing is selling a t-shirt. [00:04:30] You’re competing with everyone else who sells t-shirts, because you’re trying to sell to everyone who buys t-shirts, so they have so many choices, all of your customers have so many choices. There’s nothing that differentiates you and makes you stand out, and makes your customers appreciate you, which means that you have to spend more time working with them and trying to make it a good fit, when really, you want to represent the best fit for a specific market segment.

[00:05:00] I want to explain “market segment” a little bit, because I think people get kind of confused around this, and … Like, traditional business school and marketing degrees, they’ll tell you all about target market and market segment, and people, I think, understand that, but if you imagine like you’re at an archery range, right? Are you trying to just hit the target? Yeah? No?

Dusey Van Dusen: Well, I mean, hitting the target’s good for me. But ideally, [00:05:30] trying to hit the bullseye, right? Right in the center.

Matt Vosburgh: Yeah, absolutely. If you hit the target, that’s better than not hitting the target, absolutely, but yeah, you want to hit the bullseye, and that bullseye is … I mean, that’s what a market segment is. So if you look at a target market, which is generally demographics or firmographics, there are certain characteristics you can identify there, a market segment is going to be a subset within that target market, and these are going to be people who have shared pain points. [00:06:00] A target market has shared characteristics; a market segment are people within that target market that have similar or shared challenges, pain points, frustrations, things that they’re trying to solve for.

So, back to your question about the t-shirts. If you’re just selling t-shirts, you’re trying to sell to everybody. You’re selling to guys age 15 through 75 [00:06:30] all around the world, you’re selling to women age 15 through 75 all around the world. There’s nothing that feels special about that, there’s nothing that’s going to be a strong connection for us, and that means that I’m not going to value you and your t-shirts as much as I would if you sold them for me, if they were my kind of t-shirts. So there’s a lot of power in that.

I could just go on and on and on with this, it’s [00:07:00] really … This is really exciting to me, because it is foundational. It’s like trajectory, like if I’m trying to land on Mars, which we are right now, but if I’m trying to land on Mars, and my trajectory to get there from Earth is off by even a fraction of a fraction of a degree, I could end up millions and millions and millions of miles away from my actual intended goal, right? And so, in your business, you want to spend less time working [00:07:30] and make more money, you need to be working with the right people, and so if you’re working with the right clients, you can charge what your time is worth, and your clients are going to love you for it, right? And this is a fundamental thing that a lot of businesses struggle with, is that they’re spending time working with the wrong people, and they’re not making as much money as they should be, and they’re frustrated, and they don’t know why, and this is usually at the core of that.

Dusey Van Dusen: What does that look like, when you say you’re working with the wrong people? Like, what are some [00:08:00] signs that I’m looking out for? How do I identify that that’s happening to me?

Matt Vosburgh: Yeah, so, kind of like I said, if you’re feeling frustrated, if you have unhappy employees, if you have unhappy customers, if you are working long, long, long hours, these are symptoms of not having a strong market segment in your target market. So if those things are happening to you, [00:08:30] you need to go back to the drawing table a little bit.

Dusey Van Dusen: Okay.

Ben Snedeker: Okay.

Matt Vosburgh: Right?

Ben Snedeker: Yeah. You know, I was going to say, too, some numeric indicators also are, like, maybe your conversion rate is low, something you could target. A strong target market will allow you to sort of … Once you start understanding who that is, and you’re hitting the target, you’re going to see your conversion rate go up, you’re going to see your sales numbers go up. Another thing, even just in terms of … I’m thinking a little [00:09:00] bit more in terms of content marketing, but it’s a similar kind of concept, engagement with your audience. If we keep with this t-shirt concept, if I know that I’m targeting millennials, say, people who are between the age of 25 and 35, and I’ll pick the right social channel, and I’ll be able to message to them better than if I’m also trying to hit Gen-Xers and baby boomers, because I’ll know where they’re hanging [00:09:30] out and what they’re doing, and I’ll be able to … As I target them better, I’ll be able to actually reach out to them better.

Matt Vosburgh: Yeah.

Dusey Van Dusen: Now, Matt, I’ve heard you say that you want to work with your most profitable customers and get more customers that are like them. So, does that mean that I’m going after the biggest accounts, and the ones that are going to sign the largest contract?

Matt Vosburgh: No, that doesn’t necessarily mean that.

Dusey Van Dusen: Dang it, I’m wrong.

Matt Vosburgh: Yeah, yeah. Yeah, [00:10:00] that’s the thing here, is you want to understand who your most … Well, you want to understand who your best customers are, right? And “best” can be defined a lot of different ways. So if you’re working in your business, and you just want to be able to enjoy the work that you’re doing, that is the value to you of working with the right customers, because you’re going to be working with people you enjoy working with, right? If your [00:10:30] ultimate goal, if the big thing for you is to be more profitable, and maybe be able to grow and expand and scale your business, then the financial side of things, the actual profit, is going to be what’s most important to you.

So something, an exercise that we do with our partners when we’re helping them to get focused in this way, is kind of what you alluded to, is we help them reverse-engineer their market segment. And this is really powerful stuff, because you want to be working with the right customers. [00:11:00] Well, how do you know who the right customers are? You may think you have an idea about it, and have some experience that tells you some things about the customers that you’ve worked with in the past that feels right, but to really be clear about it and to be certain, we kind of go through this exercise. We’re going to give you guys, everybody, a link to get this really great worksheet and some information about how to boil down your target market, [00:11:30] all of that, but this is a little more abstract, what I’m going to walk you through here. It’s a little more hippie, if you will, kind of zen.

So, first thing that you need to do in this entire exercise, and any time you’re planning something around your business, is you always need to have at the forefront of your mind, and with everything, the value of your time. Like, what are your goals? What’s your vision for your business? What’s your vision for your life? [00:12:00] And I know, this is getting pretty hippie here, but it’s really important, because at the center of everything you do is what’s valuable to you, right? So what you want to do is look at, what are the things that you value most in life? Now, this may be things that you’re passionate about, it may be things that … You know, goals or dreams that you have. What do you really enjoy doing with your time, and what do you want [00:12:30] to be doing with your time?

So maybe you want to spend more time traveling, maybe you want to spend more time with family, maybe you want to spend more time donating your time and energy to, say, a cause that you’re passionate about, helping the less fortunate. Whatever that looks like, what you need to do is look at that time that you would be doing those things if you weren’t working in your business. If you didn’t have to spend all this time working with the [00:13:00] wrong customers, what would you be doing otherwise? What are you passionate about? And if you had all the money in the world, and you had to buy that time back from somebody in order to do those things, what would you pay for it?

I think most people would say, “Oh, well, it’s priceless,” right? Well, how much are you getting paid for the time that you’re working with these customers? How much are you getting paid, like, if you break it down per hour, for the time that you’re [00:13:30] spending working with the wrong customers? Think about that. This is very serious, because you are not getting paid what you’re worth, you’re not getting paid what you need to be getting paid to reach your dreams, and it’s because you’re working with the wrong customers.

So to identify the right customers, and the customers you want to be working with, with that in mind, the value of your time, what you’re passionate about, step back from your business, step back from [00:14:00] everything, and even close your eyes if you need to. And what you want to do is take all of the customers you’ve worked with. Now, there may be tens of thousands of them, but you really need to picture in your mind the actual people that you’ve worked with, the actual customers that you’ve had in the past, and kind of put them up against a wall. In your mind, imagine them all lined up against a wall, and you can see all of them there in front of you.

Dusey Van Dusen: Like we’re down at the precinct kind of thing, right?

Matt Vosburgh: This is the police lineup, absolutely. [00:14:30] Absolutely, yeah, we’re going to identify the perpetrators here, for sure. But yeah, look at … In your mind, imagine all those clients, and what you want to do is identify clients or customers who fit one of three things, or more. All three things is best; those are your best clients. And here they are, the three things. Number one is, who did you enjoy working with the most? [00:15:00] I know, I told you, very scientific stuff here. But really, think about the experiences that you had working with those people. Who did you enjoy working with the most? And you can do this for employees too, right? Who did you enjoy working … Who did you get along with? What clients, what customers really lent themselves to a really great experience for you as a business owner?

Number two, who required the least amount of your time [00:15:30] and energy? So this might mean they called in for support a lot less, they didn’t bicker about the price of your product so much, you didn’t have to spend a whole lot of time teaching them about your product. So the other day, I gave you an example, Dusey, like … Dusey is an excellent customer [00:16:00] as it’s related to the time and energy that it would require to interact with him as a business for camera equipment suppliers.

Dusey Van Dusen: Oh yeah, oh yeah.

Matt Vosburgh: Right? Because he knows how to use the equipment, he understands the value of it, he knows what he wants. Like, he is not going to require a ton of their time and energy in servicing him, in serving him, in selling him the product, [00:16:30] because he gets it. He gets it right away. So think about those customers, as you’re looking at your police lineup, that required the least amount of your time and energy because they got it, they understood the product, they understood the value of the product, and they knew how to use it. Right?

So third is, who are … And you alluded to this. Who are the customers who were the most profitable for you? And that doesn’t mean the biggest invoice, that doesn’t mean the largest [00:17:00] sale, it’s … Look at the profit margin, look at the percentage of your cost of your overhead, your cost of goods, versus the cost … You know, what you sold that product or service for, and where are the largest margins? It could be a $5 sale, but if your cost was 23 cents, then that is a highly profitable customer. Now, of course, you do want to take into consideration [00:17:30] your overall volume of sales, and a lot of those numbers, but those three things, they all play into each other, right?

Dusey Van Dusen: Yeah, and I think that last point gets really important with service-based industries as well, where, like, which … What are your customers that you’re not having to constantly babysit or put a lot of time and effort into that are still profitable, and how can you get more of those that are kind of just churning away in the background without nearly as much effort? Yeah.

Matt Vosburgh: [00:18:00] Yeah. And you have to consider all three of these things at the same time, because like I said, some people, some business owners, they really value the experience, and they really value working in their business and working with clients. So maybe for you, the people that you enjoyed working with the most, maybe that is higher on the scale of value for you of those three things. Like, profitability maybe is a little bit lower because you just … You want to work with [00:18:30] people that you enjoy working with, and that’s more important.

But you have to kind of gauge those things, but you’re going to identify the people who have all three of those qualities, or at least one, if you don’t have people who have all three. Usually people will have all three, because they all play into each other, again. You’re going to identify those people, kind of have them step forward off of your police lineup, and now you’re going to start to kind of dissect them, and identify the characteristics [00:19:00] of those people. What age group are they in? Where do they live? What are their buying habits? What other kinds of products do they purchase?

And then you start getting into their pain points, right? What are their needs, what are their challenges? What is frustrating and painful for them in life, and how does my product or service solve that problem? Once you boil down those things, then you can speak very clearly to that audience, to that target market and [00:19:30] that market segment, about the value of what it you do, and the product you provide, and how it solves problems for those specific people that have these specific characteristics, because guess what? You enjoy working with them, they take up the least amount of your time and energy, and they make you most profitable at the end of the day. And there, you have a clear message about “We do this for these people, to help them to avoid these things in life and achieve these other things in life, with our services [00:20:00] and our products.”

Dusey Van Dusen: I think that points out how important it is to be customer-centric. It’s easy for us to get wrapped up in our product, and to say, “Okay, this is the thing that I made, and it’s so cool, and it’s going to go do all these things. Here, everybody, get it. Like, of course everybody would want it. Look, I know how great it is. Don’t you all know how great it is?”

Matt Vosburgh: No, yeah. No one cares. There are probably a thousand other products like it. It all comes down to, how are you going to impact [00:20:30] my life, make my life better, and reduce the friction, the pain, and the struggles that I’m experiencing with that product and service? And you’ve got to be talking to me. You’ve got to be selling your t-shirts to me, because otherwise, I don’t care, I can go down the street to the store and buy the same thing that you have, probably at a better price.

Dusey Van Dusen: It’s amazing how many people are already doing whatever it is that you’re doing.

Ben Snedeker: Yeah.

Matt Vosburgh: There’s nothing new.

Dusey Van Dusen: I remember when my mom first got an iPhone, she was like, “Hey, they should come out with an app for this,” and I’d [00:21:00] go, “Yeah, there’s one, it’s called this,” and there was like two weeks of 50 new ideas that she had, which was awesome, but I’m like, “Oh, yeah, somebody’s … Oh, somebody’s already doing it. Sorry, Mom.” Which just speaks to the need of, okay, well, go make that thing that you love, but make sure that you’re making it for a very specific audience, that you know what their needs are, that you can speak directly to them in a way that others are not.

Matt Vosburgh: Yeah, and the thing about that is, when those people buy from you, they’re going to buy from you again and again [00:21:30] and again, because you are their guy, you’re their business for that product or service. And you’re going to have happier clients, they’re going to pay you more and they’re going to love you for it, and then you’re going to actually be making what you’re worth, what your time is worth, so you can spend less time working in your business, more time going out, traveling, spending time with family, building relationships, serving down at the local food bank, or whatever it is you’re passionate about. You should be able [00:22:00] to do those things, because that’s what’s contributing to your greatness in life, and if you’re just chasing your tail and spending all this time with the wrong customers, you’re not doing anybody any favors.

Dusey Van Dusen: Yeah. Cool, well, it’s about time for us to wrap up. So, for somebody who wants to dive in more to identifying their perfect customers or their best customers, where should we send them?

Matt Vosburgh: We set up a bit.ly link to our awesome article on identifying your target [00:22:30] market, and like we said, there’s also a worksheet link there that’s going to help you kind of walk through this stuff. It is bit.ly/sbs — like “Small Business Success” — target, so that’s bit.ly/sbstarget.

Dusey Van Dusen: Fantastic. We’ll also have some other resources in the show notes at smallbusinesssuccess.com, so you can go check those out there. But that bit.ly/sbstarget is a great way to dive in deep into all the stuff that we’ve been [00:23:00] talking about today. Any last-minute thoughts, any last-minute advice on this subject that you would give to our listeners before we sign off?

Ben Snedeker: Well, I think this is a really fantastic exercise that, if you haven’t done this for your small business, this is definitely something to do. You will shape all aspects of your business, from hiring to marketing to sales. It’ll really shape who you are as a company.

Dusey Van Dusen: Even what your product and service is, right?

Ben Snedeker: That’s right.

Dusey Van Dusen: Yeah.

Ben Snedeker: Yeah.

Dusey Van Dusen: Fantastic.

Matt Vosburgh: [00:23:30] Yeah, that’s a big thing too. Helps you figure out if you’re selling the right thing.

Dusey Van Dusen: Awesome. Well, thank you, listeners. We will see you next week on another episode of the Small Business Success Podcast. Again, to check out that article and information to keep diving deep into your target audience, go to bit.ly/sbstarget. See you next week.

Ben Snedeker: See you later.

Dusey Van Dusen: Bye.

Matt Vosburgh: Thank you.