You can’t scroll pass a business coach on IG and TikTok who doesn’t press the importance of defining your ‘dream’ or ‘ideal’ client profile. And, why is that important? Simply put, it’s about clearly communicating with your prospective client in a way that will engage them to take a positive action toward your business. Will everyone engage? No, and we don’t expect them to which is why we want to appeal to the people we think will take an action faster than others.
What is segmentation?
Further defining your ‘ideal’ client into various personas or archetypes hones in on the different types of people who are willing to take action, what’s important to them, their demographics and other behavior patterns. At the end of the day you’re inherently working under the premise of getting as close as possible to having the perception of a one-on-one conversation with that prospective client about the relevant aspects of your business that they care about. Segmentation is when people are grouped into specific classifications according to characteristics or traits in order to simultaneously reach a wider audience with the most relevant message as possible.
Can you apply segmentation to existing clients?
With the tools, information and technology available, small business owners can become master marketers. They make incredibly strong connections with their followers and can yield very high conversion rates. But, once that prospect converts to an existing customer, the primary focus is on delivering what they bought - and then they’re done. This not only leaves the experience that the client has up for chance — but you’re also leaving a considerable amount of money on the table. The principle of segmentation also applies to existing active clients, not just in prospects via marketing. I may argue that it has even stronger of an impact to your client retention, satisfaction, ongoing growth and profitability.
How can you apply segmentation to existing clients?
In a dream world, we would copy and paste your best team members and dedicate each full team to every single client that you have to ensure the *best* experience ever. But that’s overly excessive, impossible for even a corporation to staff let alone a lean small business and not to mention how insanely cost prohibitive it would be to the client. Not every client needs every thing you offer. Conversely, you can’t have every member of a lean organization involved at every function. At the end of the day, in order to scale your business you need to develop some kind of logic that is appropriate for your business to segment your existing client base in order to better understand and ultimately serve them. There are many ways to segment your client base, whether it be through demographic information, geographic location, based on the types of services they purchase, the size of the organization, based on their industry vertical or many other number of ways to slice and dice your client roster.
One way that I’ve found to be particularly useful is to tier accounts based on a number of factors including revenue and growth potential. Here is an overview of how I might break down client segments, adjust your delivery model and set objectives accordingly:
TIER A
These are usually your A-list clients. They consistently spend beyond a certain threshold and they span across several of your service offerings and yet there is still growth. I like to deem these my ‘strategic’ accounts.
Goal: Create highly personalized plans YoY to expand into other service lines, but make sure it’s actually relevant to their ultimate business strategy. The idea is that you’re very proactive with these clients.
TIER B
These are solid clients. They consistently have at least one service line but you know there’s room for growth. Maybe they have a few existing providers for services you offer. I like to refer to these as ‘growth’ clients.
Goal: At a wide scale, create thought leadership pieces / campaigns based on your service lines to test and gauge what they might need and/or be interested in and then schedule a meeting to walk them through it. This is proactive in terms of automation but slightly reactive in terms of hands-on growth for the account.
TIER C
These are also very solid clients. They consistently spend, but you know they’re maxed out on their current budget. You don’t want to lose them though! Maintaining client satisfaction is important.
Goal: Retention and maintaining client satisfaction. You may likely include them in some of the campaigns or even create more how-to focused material. Just because they aren’t spending more doesn’t mean you should ignore this group. Be top of mind when they are ready to take the next step.
Need help? Let’s talk.