4 tips for a more accurate target audience analysis

Do you have a handle on your target audience?

Understanding and defining your target audience is crucial for successful sales. Nonetheless, many companies base their target audience definition on outdated assumptions and gut feelings. Many rely on their CRM data, assuming it provides a sufficient picture of whom they should target. The problem? The picture often relies on insufficient data, giving a limited perception of reality. The result is that companies direct their resources to a narrow part of the market—and miss out on great opportunities.

Is your CRM data sufficient?

It's easy to get stuck with the data available in the CRM, even though the information can be outdated and incomplete. If it's not regularly updated, you risk basing crucial business decisions on flawed foundations. In fact, your target audience can be likened to an iceberg. The part you see—existing customers and leads in your CRM—is just the tip. Below the surface lies a much larger amount of potential customers that you have yet to explore, and it's often where significant opportunities exist.

Moreover, businesses constantly change. They can scale down, change industry, or even go bankrupt. Without current information, you risk wasting resources on leads that are no longer relevant. And if your own offerings have evolved over time, a significant portion of the businesses in your CRM may no longer belong to the target audience you wish to focus on in the future.

How well have you tapped into different segments?

Another common challenge is that many companies are not fully aware of how well they have tapped into different segments within their target audience. Perhaps you allocate most resources to customers who are already easily accessible or to segments you are familiar with. But what about the segments you haven't focused on? Maybe you are missing potential customers who are both more profitable and easier to engage than you think. It’s easy to assume, "we have the most customers in this industry of this size, so we are strongest there." But to truly understand where your greatest potential lies, you should also consider the size of each segment, how well you have engaged it, and the proportion of the segment that is already customers.

How to conduct a more accurate target audience analysis

To make data-driven decisions and truly understand your target audience, you need to go beyond your CRM data. Here are some steps you can take to conduct a more comprehensive analysis:

1. Analyze your most profitable customers: Start by identifying which customers bring the most revenue, with whom you have the most successful relationships, or who are most cost-effective to engage. What do these customers have in common?

2. Use external data for a complete picture: Look outside your CRM to capture crucial data points that may exist within your ICP and to identify all companies within your target audience.

3. Evaluate your performance within specific segments: Find out how well you are engaging different segments. Are you strong in certain areas but weak in others? Are there segments you haven't engaged but hold great potential?

4. Act on the insights: Once you have a clear picture of your target audience and how well you engage different segments, you can start prioritizing your resources effectively. You won't waste time on leads that are not relevant and can instead direct efforts towards the segments that provide the best returns.

Summary: Make data-driven decisions

To make the right decisions, you must trust your target audience analysis. This requires looking beyond old assumptions and seeing the market with fresh eyes. By using updated and external data in combination with your existing CRM data, you can create a more comprehensive view of your target audience, understand how well you engage different segments, and make data-driven decisions that help you grow. And remember—the big fish hide below the surface 🐟