Guide to Defining your Customer Profile

Why do we ask you to define your customer in your business plan?

When you create your business or marketing plan, identifying your target audience is one of the most crucial sections you will need to complete. You’ll find this question in step 5 of the business plan tool and in step 3 of the marketing plan tool.

If you’re presenting your business plan to potential investors or supporters they will want to know who your customers are to assess the market potential for your business idea - and you should want to know this too!

Not understanding your customer can also result in costly marketing mistakes as you could end up having to market to the broadest possible audience. This makes it impossible to get the message right, as one size never fits all.

Customer profile basics - B2B and B2C
This is about your target audience. Are you selling to other businesses (identified as “business to business” or B2B) or to consumers, the general public (usually called “business to consumer” or B2C)? It helps to define this first of all because they are significantly different targets in terms of their behaviour and general demographic profile.

Customer demographics
For each of these target audience (B2B or B2C) groups it’s useful to work out some typical characteristics to describe your customer. You can have more than one type of customer within either a B2C or B2B group. For example, a restaurant owner might provide an “at table” service where people (consumers) can book a table for dinner. They might also offer outside catering for special events such as weddings, christenings and parties. Both of these are “business to consumer” target audiences.

Although there is likely to be some crossover (the people who book a table for dinner may want to hire the caterers for a party at some point), they can also be two distinct groups particularly when they’re looking for a service.

This means that you might have to reach them in different ways (by marketing to them) – such as promoting the outside catering service alongside wedding planners at wedding fairs or perhaps joining up with a local bakery selling wedding and christening cakes. But for dining out at the restaurant you might consider marketing activity to include listings on websites like TopTable and good signage outside the restaurant. Defining them both helps you to decide where and how to reach them and tailor your marketing messages more accurately for each.

Demographics mean typical features of those potential customers. In the case of B2C (the general public) it would include things like:

  • Where they live (location)
  • Age
  • Gender
  • Occupation
  • Education
  • Income levels


For B2B (other businesses)

  • Number of employees
  • Length of time in business
  • Location
  • Their range of products or services
  • Occupation of the decision maker (e.g. marketing manager)


In our restaurant example, the target groups we discussed were B2C and we can probably make some assumptions about demographics for each of these audiences. The customers who come to the restaurant for dinner might fit a profile like this:

  • Local residents (within a 5 mile radius of the restaurant)
  • Typical age 30 – 50
  • Male and female
  • Employed with a reasonable disposable income


Whilst the potential outside catering customers might be:

  • Larger distance from the venue but still most likely in the region
  • Typical age 20 – 40
  • Predominantly female


This already gives us clues on how we might market to them differently.

Customer behaviour
There are other factors that you may be aware of which will help to describe your customers. The following behavioural characteristics can also be considered:

  • Values and beliefs
  • Lifestyle features such healthy living, eco-friendly lifestyle
  • Travel habits
  • Hobbies and interests


Multiple customer profiles
It’s not unusual to have more than one customer profile, think of a Company like Dell Computers. They sell PCs to the general public using computers at home (B2C) and they also sell to businesses (B2B). Their profiles are different and Dell must take account of this to get the most sales from each. If it talks about cash-flow and office networks to the home buyers they will switch off and likewise talking about “budget” lap-tops ideal for home media will not attract businesses who need serious computer kit.

This is called it segmenting your market. In Dell’s case they have both B2B and B2C customer groups and within those they can probably segment further into sub-groups such as small home-based businesses and large office based companies.

Defining existing customers, potential customers and best customers!
If you’re already trading, you can and should also think about further dividing your customer profiles into existing and potential customers. This is particularly relevant if you want to enter a new market but it’s just as useful to help you decide on your best customer type.

If you have customer data based on previous sales and feedback you can quickly identify the ones that are most profitable for you, most loyal and pay on time. You should also be able to form a picture of those that are poor for your business who maybe switch supplier based always on cost (no loyalty), don’t pay on time and drive you down on price constantly which harms your profit.

Finding customer profile data
It’s sometimes difficult to have enough data on your potential customers before trading. In this instance you may need to rely on other research to help you define target customer profiles.

The office of national statistics can provide some demographic information, as can local council websites often. For behavioural research you may need to carry out your own using methods like surveys, questionnaires and interviews. See our guide to market research for more information on primary and secondary research.


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