- Hi there, I'm Dan Martell.
Serial entrepreneur, investor and creator of SaaS Academy and
in this video I'm gonna teach you how to define your
perfect customer for a B2B SaaS business
where you can get clear on who you're targeting and
ensure that they're excited to buy your product.
And be sure to stay to the end where I'm gonna share with you
my Rocket Demo Builder.
It's a strategy you can use in your product demos to get
customers to buy fast without giving you the cold shoulder.
(upbeat music)
Choosing your perfect customer is probably the number one
biggest decision you have to make as a founder and you know
one of the things that I get to do with my new SaaS Academy
clients is sit down, the first thing we do is sit down and get
clear on who they're serving as a customer base.
Ideally focusing on three primary buckets but then here's
the kicker and it always gives them angst is I ask them to
choose the one customer that we're gonna focus on over the
next 12 months that they feel if they made that investment
it would allow them to hit their next level of growth.
And some of my clients, I'm gonna teach you how we break
down the criteria of what makes an incredible customer but one
of my clients grew 2-and-a-half million in ARR in a six month
period by not trying to serve too many customers but by
focusing on the one they knew could actually drive revenue and
still have the halo effect of other companies using their
product but in regards to driving marketing,
sales and content creation, we need to pick the one.
So in this video I'm gonna share with you guys
the six criterias that I use and you should use in defining
a great customer avatar.
Number one, firmographics.
This is deciding what industry you actually want to serve.
Now some of you guys are saying, "Well a vertical or an industry
"is not big enough for me to succeed."
Just take one step back.
Think about how hard for me it is to sell to
a law office and to a fitness studio.
Both of those have different ways that
they talk about their customers.
One might call them "athletes" or "dancers".
The other one's gonna call them "clients".
They have different structure of compensation,
how they make decisions.
Obviously law firms have partners.
A gym owner might just be a solopreneur.
They're totally different yet I see constantly every day
companies trying to serve both markets.
So if you want to dial this in, figure out from a revenue point
of view what's the revenue band that you want
to serve within that vertical.
My favorite question to ask is what percent growth would you
assume those companies are growing every year that you'd
want as a customer because do you want a company
that's failing, that's struggling,
that's been declining over the last five years or
do you want one that's been growing
20, 30, 40 percent year over year?
Those are the number one.
It's the firmographics, you got to get clear on that.
Number two is the demographics.
If you think about it you want to concentrate
your focus on a region.
This is called the trading zone.
When you're going to market if you're selling
e-commerce software to the luxury brand markitcle,
"markitcle"? Market you could probably crush it with
two cities: New York and LA.
Yet many times when I ask companies,
"Where do your customers buy from?"
They'll go, "Canada, US, Australia and the UK."
And I always challenge them, "If you could pick one over the
"next 12 months, one country, which would it be?"
"US." "Perfect."
It's gonna hurt but it we went even further we pick cities.
"Which top cities would those be if I gave you five?"
They know exactly, they name them off.
Could you hit your goals in the next 12 months
focusing on those five?
Look, you'll still have the halo effect.
You'll still be able to serve people outside of that.
I'm not saying you know geofence your website.
I'm just saying let's focus.
Content, paid advertising, marketing,
partners, customers in those cities.
Could we do that?
'Cause think about it, when you're serving two or three of
the similar companies in the same city that maybe that
founder knows about and those people are case studies on your
website, the ability for you to close that customer against your
competitor is like 3 or 4X and that's the power of focusing on
the right demographic.
Number three, technographics.
This is probably the most interesting and fun and advanced
targeting that you can really add to your customer avatar.
So one question I love to ask my customers is, "What are other
"tools or services that your best customers buy?"
What are things that your top customers probably also use in
regards to products, toolsets, et cetera.
If they bought your product is there anything else that they
would likely buy right after they buy you?
In answering that question you get very clear on the toolset
that those companies use and the reason why that's so powerful is
from a qualifying point of view is you can actually find out
and target those companies. So there's two ways to do this.
One is to actually look at the toolsets that are actually being
used on the public marketing website.
So you can get an understanding of their analytics tools,
of their recruiting tools, you can get a lot of data just by
looking at how they build and the tools that they've plugged
into their public marketing sites and there's bunch of
companies that are online that will help you do that.
The second is there's actually ways that you can look at the
job postings for those companies and see what kind of technology
that they require in different roles within the organization
for experience levels from the new hires.
So you can defer by well if they're looking to hire a VP of
marketing and in there they say you have to have experience with
Salesforce and Hubspot and, you know, Google Adwords.
Like you can start to defer the types of technologies that
they're using or decipher, sorry,
that they're using so you can get clear on hey,
these are my perfect customers and these are the links to the
different web sites how do I
and again there's data providers that will give you
that information to make that super clear.
So technographics to me is a very new thing that's kind of
come online with the power of the internet that a lot of
founders are not using in their SaaS businesses.
Number four, psychographics.
So sounds kind of crazy.
It's 'cause it's got the word "psycho" in it but just think
about it this way is there's probably a certain attitude if
you think of your best customers there's an attitude that they
have in regards to the way that they communicate,
the way they ask for information,
the way they talk to your team, it's crazy how I can tell when
I get on a call with a founder just based on the flow of the
conversation if they're somebody that I would love to coach.
And I can know that within the first three minutes.
That's a byproduct of the psychographic make up of that
person or that organization.
So just think about it this way,
you have values in life that you life by.
You may not know that but you do, they drive you.
Your customers have similar values.
When you work or accept a new customer in your business,
especially if you're a more of a mid-market sale and you've got a
customer success team that's got to work with these clients,
you will frustrate your team if you bring on the wrong customer.
So one of the things that I highly recommend is getting
clear on what types of psychographics
or values the companies,
the best customers that you love to serve, would have.
Just think about it this way,
early adopters have a certain approach to life.
If you try to sell technology to a laggard,
you are going to be fighting an uphill battle.
It'll be like swimming upstream.
Yet, if you could filter out based on some questions of their
approach to innovation and technology,
then you can know right from the beginning your SDRs,
your sales development reps,
the way they qualify the customer
that your salespeople would never talk to somebody isn't an
early adopter 'cause if you have innovation that's truly like
AI for the restaurant industry, you can't be talking to the late
adopters or the laggards 'cause they'll just frustrate your
sales team even if you're successful at getting them
into your sales pipelines.
So to me psychographics is a huge opportunity for you just to
align on values between the way your company wants to operate or
who they can serve and the customers' default values.
Number five, roles.
If you sell mid-market to enterprise
there's a very good chance you have multiple people in your
organization who you sell to or if the CEO
or the founder or the owner is not the buyer.
So I call this a multi-threaded account where you have to go in
and identify your champion and figure out who the purchasing
decision or who's got the budget approval and really define those
roles so when you're sitting down you're creating that
customer avatar if you serve those types of markets,
you might have two or three folks that you would need to
build relationships with from a sales point of view
to actually get a deal closed.
So be sure you sit down you get clear on the roles,
the titles, maybe used some LinkedIn to do the triangulation
and research and also understand what kind of background or
things that drive them in their career.
The fears and frustrations of their roles in the business and
make sure you speak to those individually when you're having
that sales conversation but it needs to be clear when you're
defining your customer avatar.
Number six, give them a name.
So many great companies like Hubspot and Slack and Dropbox
and many, they're very deliberate and clear on what
their customers are called and for different segments.
So Marketing Mary is one you know.
You've probably have heard for Hubspot.
Jeff Bezos from Amazon is famous for creating an actual,
I think, a chair that's open in a meeting room to represent the
customer that they're serving. Right?
So just like this symbol of the customers voice in all meetings.
The reason I and I do this with all my coaching clients is we
give them a name so that all the strategies when we talk about
marketing and sales and customer success,
we always can refer back how does this buyer,
and I've had names so funny.
Everything from Edward to Ollie to Eddie to Vanessa to Clare.
You name it, my customers have called it.
For me it's "Software Scaling Sam".
You behind the camera right now if you have a software business
that's doing 10K+ per month, you're "Software Scaling Sam"
and the reason why is that that way
the whole team can talk about it.
For me it's like, "Oh, is this video gonna serve Sam?"
It's like, "Yes, these are the types of challenges
"that he's running into, the questions he's asking
"so let's do some content around that."
So I think it's really important you take the characteristics of
your best customer, your target avatar,
and you actually give them a name,
it's a label and you put it on,
I even had one of my coaching clients,
David out of Philly, he showed me in his office
he had a print out poster of his perfect customer.
And what was great was, he went the next step,
he put the opposite, the PITA customer,
the pain in the butt customer, next to it so he could remind
everybody when they're in the conference room talking about
anything, "We serve this person, not this person."
So that, when we talk about values is a huge representation
of how that could show up as an artifact in your startup.
So quick recap, number one, firmographics.
Two, demographics.
Three, technographics.
Four, psychographics.
Five, define the roles and six, give them a name.
So as I mentioned at the beginning of this video,
I want to share with you my Rocket Demo Builder.
Essentially it's the five core principles that I use when
I'm coaching my clients to close demos,
product demos, faster so it's a demo, not a tour.
That's number one.
And also talk about how to use the virtual close to get
customers to pre-sell in their mind using
your product within their organization.
You can click the link below to get your copy,
it's super powerful.
One of my clients actually just told me they closed a
Fortune 100 company to a 100K deal using the demo process.
Their first time so they're pretty pumped and excited so
click the link below and get your copy and
I also want to ask you if you loved this video as much
as I loved creating it, click the like button.
Share it with somebody you care about and leave a comment below
and let me know what part were
you missing in identifying your customer avatar.
As per usual, I want to challenge you to live a bigger
life and a bigger business and I'll see you next Monday.
Bah-buh-de-bom.
Bah-bitah-bitah-bom.
Bom-bom-bom-bom- bom-bom-bom.