Identifying your best clients and targeting similar prospects can have a great impact in your profitability. Looking ahead to the Practice Excellence Conference in October, Valme Claro explains how building detailed profiles of these clients can be the first step to finding more of them.
Offering a great service depends on many factors: the people you work with, the software and technology you use and many other elements. But have you stopped to consider how working with the right clients can affect your firm’s long-time success?
Working with the wrong clients drains your time and resources, distracting your team from working with more profitable clients. The wrong clients force practices to focus too much on administrative tasks and ultimately undermine profitability.
According to the Pareto Principle approximately 80% of profitability comes from 20% of the time worked. Identifying clients who need more support and replacing them with those who demand less can push your profit margins in a more positive direction.
A clearer focus on who you serve will also help differentiate your practice. Chris Hughes, agency director at PracticeWEB, explains: “In terms of the services they offer a lot of accountancy practices look the same to business owners. The one thing that all clients are looking for is someone who can help them with their challenges and more than just doing a tax return.”
This something extra, derived from your ideal client profile, can set you apart in the marketplace. AccountingWEB’s Practice Excellence Awards have already picked up the emerging trend for firms to specialise in particular niches. As a preview to a more detailed session taking place at the Practice Excellence Conference in London on 19 October, this article presents some starting points to help you define your own ideal client.
Define your ideal client
The first step in the process of identifying your ideal client base is to think about the attributes they would have.
“It’s not always about who’s the most profitable client,” warns Hughes, “because they might not operate in the niche market you want to break into, or perhaps they may not fit your business ethics well.”
Let’s assume you have been working with a client who is performing well in the digital agency space. What is it that makes them such a good client? Asking these clients for feedback and exploring the issues they’re wrestling with is a great way to find out how to tailor you service to suit them even better. This exercise can also identify skills gaps within your team, or bring new opportunities to light.
Once you define and understand what challenges your ideal clients face – and align your services to those challenges – you will be better able to attract clients who have a similar profile.
The ideal attributes will vary depending on the sector you want to serve, but should take in:
- The basics: Income, turnover, demographic details, goals and challenges
- Personality traits: Organised, responsive clients who get their data to you early are generally more profitable
- Realistic expectations: It really helps to work with people who understand what you do for them and appreciate your efforts
- A personal connection: Working with clients who have similar outlooks to you will make your job more enjoyable
- Tech-savvy: Clients who are frightened of technology may not cope if you are keen to automate.
Once you have a clear list of the attributes you are looking for, build specific personas for them. These documents set down detailed descriptions of who they are. By capturing a clear picture of who you want to reach, the profiles can help you tailor marketing content for them.
“Add a little bit of a biography to personalise them and always have an image of the persona,” says Hughes. “And then use them whenever you are doing anything. For example, if I’ve got Kevin who runs a taxi firm with me here in the office, his big challenge is to find more taxi operators.
“He’s got low capital, poor cash flow and his goal is to retire at the age of 45. It helps if you have a reference point you can draw on to zero in on his concerns. It’s is problem-solution exercise.”
Hughes also suggests creating an anti-persona, defining the people you don’t want to work with. This can become a checklist you work through with prospects, which is what they they do at multiple Practice Excellence Award winning firm Tayabali Tomlin.
Tayabali Tomlin has a set of benchmarks it applies. If it can’t identify potential growth, profit improvement and other opportunities to add value, it will decline to work for that client.
How to find and target the ideal client
Once you’ve got your profile information, you’ll be better equipped to get out to network and find out more about them. Find out what channels they turn to for information so you can join conversations with existing clients and new prospects.
In previous Practice Excellence articles, Richard Sergeant interviewed Gloria Murray and Kylie Fieldhouse about how they use digital marketing and social media to build relationships with their ideal clients. Some of the strategies that can work here include:
- Operating on the platforms that your ideal clientd use and creating an attractive profile to attract them
- Creating a website that reflects your unique values to help like-minded clients find you
- Aligning your rates to your ideal client type. Sometimes, offering lower rates to attract the right clients is preferable to working with clients that are willing to spend more, but do not fit your expectations.
If you would like to get more practical help on why and how to target ideal clients, PracticeWEB will be covering these topics at the Practice Excellence Conference in London on 19 October. Find out more from the Practice Excellence Week website.