Avoiding everyone-itis is a better path for most small business owners. Certainly better than being a generalist.”Who’s your target customer?” I asked.” Well, anyone.” They responded with proud smiles.”Oh no…here we go.” I thought to myself.When it comes to starting or running a business nearly every program, coach or consultant will ask you who are you targeting.
There’s a really good reason for that (hint: it’s not to annoy you). It’s because the answers to most of the questions you have around your business, depend on who you’re targeting. Most things can be done in a much more targeted and efficient way when you’re clear about who your offer (product, service, software or other) best serves.
Everyone-itis is what I refer to as the disease of creating an offer targeted to towards everyone. Most businesses that suffer from it are at best struggling and sluggish. I’ve had many guests on the show share how when the made the decision to be more focused it shifted their business in the right direction.
In This Episode
In this Episode I’ll share 3 problems that casting too wide a net for your target customer can cause in your business and share with you a real business case.
All of that and so much more. Enjoy!
Podcast Episode Highlights
- 0:00 Introduction
- 1:14 Casting a wide net
- 3:12 Aligning your communication
- 5:05 Becoming the generalist
- 6:30 Less than average
- 8:39 Can it be too narrow?
- 10:13 An business case
- 13:58 Wrapping it up
“Usually people try to cast such a wide net because they’re afraid that if they cast too narrow of a net, that they will miss a lot of potential opportunities.” Janene
“When people have a more narrow focus on who their target customer is, they are able to communicate better.” Janene
“Ultimately then you’re able to have higher prices than other competitors who have still positioned themselves as generalists.” Janene”
Figure out who you really want to serve, who do you really do magic for and be really focused on getting that group of people.” Janene
“When it comes to pricing segmentation, segmentation, segmentation, because it’s really helpful to have different offers at different price points for clients and customers who are looking for different levels of value from you.” Janene
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In today’s episode, I’m going to be talking about customers. And specifically why casting a wide net when it comes to who you’re targeting as your customer base, can be problematic in your business.
Now, this is a big topic and something I’ve run into a lot recently, which is why it came to mind as a great topic for today’s episode. When you cast a wide net, what I mean is that you are making the assumption that your offer can be to anyone. Which in many cases, for many of us sure our offers can be of use to anyone. But just because it can be of use doesn’t mean that that’s the best way to go about marketing and selling and pricing and all the other things you need to do in your business.
In fact, if you can be more specific about where you are targeting or who you are targeting, then that actually makes things easier in your business, in the long run. What most small, especially new businesses do is they try to cast a wide net so that they don’t miss any opportunity. And then doing that, they make it really difficult for themselves to be specific enough, to be recognized in a specific area with a specific niche. When you have a specific area with a specific niche you can capture value better, which is a fancy way to say you can have better prices. Let’s look at three problems that casting too wide of a net when it comes to your target customer group can bring you.
It Get’s Hard to Communicate Effectively with Audience
The first one is it’s, really hard to communicate clearly enough and specifically enough, when you cast a wide net. Because the generalizations you can make about the population of your target customer group group, get watered down the bigger that group is, or the more that, the more demographics that group includes. If you say I’m, I’m going to cover everyone versus I’m going to cover people who are, let’s see,
You know, highly educated, for example. Then just by being that specific, you can adjust your communication, so that resonates more with that group. And that means you would get a higher percentage of people from that group being like, “yeah, that’s me. I want to look into working with this person or buying this product.” Because your communication, your messaging is tailored to how they describe the problem. How they feel about the situation. What they describe as what they want in a solution.
And when you cast that net to wide it’s really hard to be that specific and it really waters down your communication. So that is the first problem that casting too wide of a net brings you. And this plays into your pricing as well. But we’ll come back to that in a moment.
Communicating Value Well Influences Price
Before I move on, let’s be clear that the way that you communicate around your offer. Huge impact on pricing. In this case, it is going to have its own impact on pricing, but also how you’re able to communicate the value specifically to the group of people you’re targeting has a huge impact on how they perceive the value and therefore what they’re going to be willing pay.
Positioned as a Generalist
Problem number 2. When you position your offer or your product or your software as useful to everyone in every, anyone you become a generalist. And this positions you versus all the experts out there as a generalist versus an expert. And usually what you’re going to want to do is if you’re producing a certain product, you want to be, the expert in this product, you want to be the expert in solving, solving the problem that product solves. Or if you’re a service provider. And providing that service solution.
If you target too wide of an audience without without narrowing the focus a bit, then you position yourself as a generalist in the market. You kind of end up becoming like that one size fits all t-shirt. And most of us know from experience that a one size fits all tee shirt is maybe great as a pajama for sleeping in, but not really great for too many other things, or maybe as a cover up, right. If you’re at the beach, but not really for too many other things.
So you want to be careful when you have too wide of an audience because you suddenly position yourself as a general. And that is also going to impact how people perceive the value and therefore the price.
Less Than Average Value Capture
The last point, when you’re a generalist and when your communication isn’t targeted toward a specific group, then your pricing usually ends up being below average as well in order to capture enough of the market to make it interesting for you to be functioning there. You end up putting yourself out of the premium, below good value for money, more towards an economy solution, simply by casting such a wide net.
Now this isn’t the case in every business, but this is by and large, what ends up happening because as being a generalist and positioning yourself with this way of trying to capture a wider group of people you end up with a focus on just getting volume as opposed to value and profit.
That happens as a consequence of this wide net that you’ve cast. Usually people try to cast such a wide net because they’re afraid that if they cast too narrow of a net, they will miss a lot of potential opportunities. But what happens nine times out of 10, when people have a more narrow focus on who their target customer is, they are able to communicate better.
They are able to find those people who are there, people who need their product or need that software that you make. They’re able to find them easier because they know where to go to find them and how to speak and communicate with. Then you can pull yourself out of that generalist position into more of an expert position.
Ultimately then you’re able to have higher prices than other competitors who have still positioned themselves as generalists. You’ve lifted yourself out of the bottom.
What If I’m Too Narrow?
Now I always get the question. Well, can I have too narrow of a market? Of course, that is possible, but it is usually the exception, not the rule.
One thing you should be using is segmentation, so you can target different parts of the market. It allows you to have communication for that specific market, have an offer for that market that fits the value point that they’re looking for and therefore the price point for them. You have slightly different offers for other groups if you can.
This depends on your product or your service or whatever your service or whatever you’re offering, how much you can do that. You don’t want to slice it and dice it so much that it’s difficult for you to manage, but you use segmentation in order to create the right offers and have the right price points for different groups within your broader target.
I always say about. When it comes to pricing segmentation, segmentation, segmentation, because it’s really helpful to have different offers at different price points for clients and customers who are looking for different levels of value from you. And that is the best way to sort of break down if you have a wide net and you don’t want to give anything up, then you can even break it into segments and create offers specific for those segments.
A Business Case
I had a client who asked me to review their website their new pages with the new pricing. This particular client had two offers one was a very high-end offer for highly skilled high net worth kind of individuals. And then the other was for young people who were just starting out and sort of exploring is this the direction that I want to go?
They had two different pages, one for each of those groups. plus a pricing page – the prices for both offers on that pricing page. This created conflict, right? Oon the one hand, they did good because they segmented and lifted themselves out of being a generalist, but then kind of plopped themselves back into it because their pricing page had the prices for both on there.
Both the offers and prices were very different for each group. And if the target group that were say, young people went to the pricing page they might see the prices for the high net worth individuals and think, “holy cow, okay. I need to move on.” Cause that’s way out of my budget.
The high net worth individual might look at the offer for the younger people and think, “wow, why is mine so much more expensive?” Now, let me be clear with you. These were two completely different offers. And so they were positioned as completely different offers because the value they deliver was completely different. It totally makes sense.
One Small Change Made the Segmentation Work Better
We made one small change. We removed that pricing page and we just put the prices with the offers. Something that simple can actually help to make, first of all, make things more clear for the person who’s looking at it, but then also that segmentation itself becomes a more rock solid.
The communication, the value piece,. Getting that message, right. For those high net worth individuals on their page and then telling them their price. And the same thing on the page for the young young adults is, get that messaging, which is going to be very different right. And then put the price on that page made it function much better.
We were able to take her out of this generalization mode and put her into two very clear, but very different segments in a way that worked both for her and for the clients. That’s just one little example. If she had tried to be an, a generalist and cover both all at once with one offer, you can see that in order to meet the needs of the young adults from price point, she would have needed a relatively low price to capture anyone there. But in doing that, the high net worth individuals might take a look at it and say, wow, that’s way too cheap. I’m not sure I believe the value could be there. I’ll skip this one. So she kind of, you know, if that had been what she’d done, she put herself in a really tricky situation to get any quality business, right.
Are You Also Casting Too Wide Net
Putting yourself on purpose or by accident into a generalist category by casting too wide, a net?
And if you are, how can you start to segment that into two or three different groups so that you can be more focused in what you’re doing now, if you’d like to listen to the episode with Meggie, which I mentioned earlier. So Maggie was my guests recently on live with the pricing lady and she shared her own experience about how.
Trying to serve. Everyone made it really difficult in her business. And what happened when she made that shift into admitting to herself that she really wanted to help a specific demographic of people. What did that bring to her business? You can go back and check out the episode from Maggie Bergen.
Wrapping It Up
That’s what I wanted to share with you today. Let me just recap briefly when you cast too wide, a net, or try to have an offer that serves everyone, you make it much harder for yourself to communicate with your audience in a way that will really resonate with them. You position yourself as a generalist, and last of all, your pricing needs to be below average in order to capture enough volume to make it worth your while.
What you want to do is you want to figure out who you really want to serve, who do you really do magic for and be really focused on getting that group of people. Change your communication, to align with what they want and how they speak.
Pull yourself into the expert zone and out of the generalist zone and start getting those prices up there because you’re serving the right people in the right way at the right value point.
I wish you all the best, everyone take care and as always enjoy pricing.