Do you know who your ideal client is? You may think it's anyone who will pay for your products or services, but it's not. If you don't narrowly define your ideal customer as someone who values what you offer and will refer you, you're destined to compete on price - which is a losing battle unless you're prepared to be the low cost provider.
In his latest blog post, John Jantsch talks about the problem with solution selling and responding to RFP's: essentially that "both of these approaches make every business look the same so price is the primary issue."
In solution selling, you target a market segment, tell them what you have to offer, maybe work in a little solution selling and hope they choose you.
With RFPs, you target a market segment, respond to RFPs and hope they choose your price.
According to John, either way, what you’re building is a recipe for low prices and even lower profits.
It's interesting. I'm a Duct Tape Marketing Consultant and one of the first things we do with every client is a thorough analysis of their customer base and interviews with 6-10 of their best clients, in order to really identify and narrow their target market to those customers who value their services, are profitable, and refer them.
However, as a technology marketer I was brought up on solution selling and responding to RFPs, but never really thought about how thses practices might contribute to the affliction of competing on price.
How do Solution Selling & Responding to RFPs Lead to Competing on Price?
As John explains, the secret to high profits is to take price out of the equation by offering some unique and desirable element that can’t be compared, whereas solution selling and responding to RFPs basically make every business look the same so that price is the primary issue.
What's the secret to choosing your ideal clients?
That's right, you need to choose your ideal clients - not let clients choose you. Throw out the idea that anyone who will buy your products or services in an ideal client. This is the surest path to competing on price.
By identifying the characteristcs of your ideal client, and only going after prospects that fit that profile, you will significantly improve your chances of working online with clients who appreciate your unique approach and expect to pay you what that's worth.
Start identifying your ideal clients now:
I highly recommend you read John's full blog post for his three key steps to identify your ideal client:
1. The Unmet Need
2. The Crucial Behaviour
3. The Ideal Client Sketch
You can read John's full blog post here.
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