What Does a Profitable Customer Look Like?

Often we are asked to describe what a "good prospect" looks like.  Most often the answer begins "anybody who ..."

Starting with "anybody who" is a pretty good indicator that the definition of a "good prospect" is too broad.

To get a better handle on this question, ask yourself what the elements of a "good client" are compared to just a "client?" A good client ...

• Appreciates our unique expertise, experience, or other value
• Values our time
• Is fun to work with
• Does not squawk about cost
• Pays on time
• Costs less to acquire
• Is easier to retain
• Is a fan who recommends our products/services to others

Next, ask yourself if the clients you have that meet the above criteria have distinguishable characteristics from those that don't meet the above criteria.  Examples might be ...

• Large company versus small
• Privately owned versus public
• Type of product or service purchased
• Geographic location
• Industry or niche of client
• Work with real stake holder versus purchasing agent
• Profit per deal
• Deal flow (# of deals per year)

Often times this type of exercise causes company ownership and sales people to realize that certain clients, although profitable, have a hidden cost.  That cost is the opportunity cost of acquiring a good, more profitable client rather than just a client.

This exercise obviously changes the way we describe a "good client."  It also may change the way we describe our products and services as well as our marketing strategy and tactics.

What surprises have you discovered about "good clients" versus just "clients?"  How has it changed how you prospect for new business?