Starting and growing a company

How do I define the target customer for my business?

By Mahmoud SaiedLast updated 27 October 20262 min read

The short answer

Your target customer is the segment that needs your solution most, can afford it and can be reached at a reasonable cost. You define it from data on your current customers and interviews with potential ones, not from assumptions, then write it up in a one-page profile the whole team works from.

Step by step

  1. 1

    Start with your best current customers

    Who buys more, comes back, pays on time and recommends you to others? What do they have in common?

  2. 2

    Divide the market into segments

    For consumers: age, area, income, need and buying habits. For businesses: sector, size, city and who makes the buying decision.

  3. 3

    Talk to customers directly

    Short interviews that ask about the problem, how they solve it today, what they pay, and what would make them switch suppliers.

  4. 4

    Choose one first segment

    The segment with the strongest combination of need, ability to pay and ease of reach, and start there before expanding to others.

  5. 5

    Write the customer profile

    One page: who they are, their problem, what worries them before buying, where they search, and who influences their decision.

  6. 6

    Test and adjust

    Aim a message and an ad at this segment, track the customer acquisition cost and the purchase rate, and adjust the profile to match what the numbers say.

A common mistake

Saying your product suits everyone means a message that speaks to nobody and a budget that goes to people who will not buy. Focusing on one segment does not stop others from buying.

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