Getting to Know Your Customers: How to Create Effective Personas
What is an Ideal customer persona?
Your customers are the bread and butter of your business - so it's crucial that you take the time to get to know them as best as you can. A Persona can help you do just that by creating fictional, generalized representations of your typical customers. In this way, you can better understand their needs and design products and services that appeal to them.
Personas can be an extremely valuable tool - but only if they're created effectively. So how do you go about creating an ideal customer persona?
What should we include?
Personas are fictional, generalized representations of your customers. They can help you understand and empathize with your customers, and even better- design products and services that appeal to them! In order to create ideal customer personas, you'll need to gather data about your typical customers.
This might include demographic information, such as age, gender, occupation, and income level, as well as psychographic information, such as interests, values, and lifestyles:
Here's an example:
Feeding into, or from, our product-market fit canvas, it's also helpful to research:
Watering holes (social media, online, print, memberships, events, etc)
Top 3 challenges
Top 3 questions
Top 3 objections
Pain point(s)
Statements of value/value props(s)
and finally, list your data sources and review them annually
Calculating your ROI
In terms ROI, a COCA (Cost of Customer Acquisition) Analysis is a helpful guide when setting budgets and calculating the growth investment requirement. Here's a quick example of how this can be done:
Your (monthly/quarter etc) objectives:
Funnel Stage | Volume | Conversion % |
Visitors / prospects | 15,000 | x 10%* |
= Your Leads | 375 | x 25% |
= Your Opportunities | 94 | x 25% |
= Customers | 24 | |
Quick Max COCA analysis:
Lifetime revenue (LTR) | 100,000 |
Gross Margin (GM) | 50% |
Lifetime Value | 50,000 |
Cost of Customer Acquisition (COCA) % | 10%* |
Your COCA Cost / Budget | 5,000 |
In plain English - to acquire the 24 customers, you should budget around max COCA of 5,000 x 24 = 100,000. From this would also establish your CPC spend (COCA/visitors = max CPC).
#Tip There are plenty of free persona template generators out there to get you going, like Hubspot. But by far the most important contributing factor is sourcing up-to-date and as accurate as possible data on your ideal customers and buyers.
#FreeGift: Here's a free editable Persona template for you :)
