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Ryan at College-Startup has posted something interesting: Shaping Your Client Base. The article contains some good ideas about why you may not want some people as your customers. Though some of the ways he states his case might be offensive to some business people or customers, it is an issue that is particularly important in internet marketing.

He begins with the story of a friend who is running a business and had just decided to cancel his 1-800 number. Here’s how Ryan explains this decision:

You see, my friend realized that the sort of clients that were using his 1-800 number were exactly the sort of client that he did not want to have. This got me thinking about the fact that a key business tactic is learning how to optimize your client base.

This may not sound right to you if you haven’t ever run a business, but think about it for a minute: If a customer comes in to your store and asks your employees lots of questions or complains about your business instead of making a purchase, how valuable is that customer compared to the ones that come in and spend their money with minimal effort on your part?

He goes on to describe the perfect customer as one that doesn’t need any help, but only buys your product or service without complaint. This perfect customer is the one you should be targeting. Sure, this is a perfect world type of scenario, however, going through the exercise of describing the perfect customer will help define the qualities of the customer who is most likely to make you money rather than cost you money.

In internet marketing this is vitally important. You can’t spend all of your precious resources chasing customers who aren’t really interested in purchasing, or, worse yet, using a shotgun approach to marketing that doesn’t target anyone in particular, but everyone that comes by. This might be OK if you’re not paying for this advertising, but, if you are, your chances of making a profit with this method are very low.

The bottom line is that it’s a very good idea in any business to know your customer. This means you should know who your ideal customer is and what his or her needs and purchasing habits are. This will help you spend your efforts in doing what’s most likely to bring in the money.

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2 Responses to “We Don’t Want Your Business”

  1. 1 Leroy Brown

    I read something similar recently ( can’t remember where for the life of me ) that compared this practice to that of GE. GE is famous for firing the bottom 10% of it’s employees every year. Using this practice on your customers is very effective, provided that you have built a big enough name for yourself. Firing the least profitable customers ( some you may even lose money on! ) is a sure way to bring up your overall profits, and give you less headaches.

  2. 2 ray

    Yep. GE lays off a ton of people on a regular basis it seems. Maybe that’s the reason. I think this is probably something that’s even more important for little guys, though. We just have to focus on where the money is, but do it without being jerks.


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