Using Customer Personas To Write A Better Business Plan

If you've ever seen a customer persona, you know they are very detailed and easy to understand at a glance. 

For those of you who have never seen a customer persona, also referred to as a buyer persona or a marketing persona, it is a detailed description of a fictional character, usually presented in graphic form, with discrete sections outlining various categories of information about the character. 

Customer personas tend to give the impression that the writer is an expert in consumer psychology and probably used a lot of proprietary research to develop this detailed insight into the demographic and psychographic traits of the customer.

But that impression is wrong!

Though a customer persona can and should be backed by some hard data, any entrepreneur can write one. Actually, every entrepreneur would benefit from writing several personas, dividing their customer base into segments, each representing a typical sample buyer. We’re here to demystify the mechanics behind coming up with useful customer persona templates, as well as why you should be doing this type of exercise.

Why Create Customer Personas At All?

The most successful businesses are the ones that meet a true need for customers. But not all people have the same needs and face the same problems! From the moment you consider starting a business to the time you write your business plan and enter the execution stages of launching a successful venture, it's critical to know exactly who you're selling to.

Without an understanding of their lifestyle, problems, and desires, you can’t innovate to create new solutions for them. Rest assured that your competitors are investing time and resources into this very thing, and they will certainly beat you to the punch if you’re not continuously searching for new ways to delight your customers.

So How Do I Create Customer Personas?

The key to getting the most from your customer personas is to make them as real as possible. You’re not trying to create a stereotype or generalization, you’re actually trying to identify who your ideal customer is and what drives their purchasing decisions, since ultimately your goal is to get them to buy from you.

There are many paths towards writing an effective persona, and you may not be able to use the same methods as the next person. For example, this exercise is much easier for existing businesses than it is for start-ups. If you’re already in business, you can use your simple powers of observation to determine the characteristics of your customers. You can also use your CRM or POS system to identify the traits of the average customer. But for start-up entrepreneurs, you have to turn to other sources to identify your target customer segments. 

Here are some strategies to define customer traits: 

Be generally well read 

Ok, I know this is hard. How can I tell you to be something that you may not be? If reading endlessly wasn’t your jam as a child, you may believe that you are not able to become a voracious reader now. I believe that entrepreneurs can and should be well read. And if reading truly isn’t for you, then you can at least remain well informed by watching the news, listening to news radio, and listening to podcasts. We glean so much data about our world from the media we consume, so pick good media and incorporate the practice of being informed into your daily routine.

Google It! 

I don’t know how many times I can give this advice in this blog, but search engines are amazing. They’re the light of my life (I mean, besides my husband and two children … sorry honey!). They’re the main reason I know anything at all (the search engines, not my family). So, if you want to know the answer to something, just Google it! If you’re starting an online travel business, search for “online travel customer demographics.” You will most likely find something usable.

Talk to people

Listen everyone: entrepreneurship is a social activity. Even if you’re an introvert. You need to talk to those around you and ask their opinions. Try these conversation prompts to get at the information that you’re looking for:

• “Have you ever shopped at a ____ store?”
• “Have you ever bought a ____”
• “Do you ever use ____ services?”

Come prepared to take notes. Log their answers and take note of their demographic characteristics, such as age, estimated household income, or education level. Then ask follow-up questions:

• “Why?” (or “Why not?”) 
• “What was good (or bad) about the experience?” 
• “What made you want to (or not want to) shop there/buy that?” 
• “What was convenient (or inconvenient) about the experience?” 

You may just learn something about how a business model is leaving a customer group underserved due to a lack of understanding about their needs. You can also follow up with:

• “Do you know anyone who has?”
• “What were they like?”

Use Google Analytics

If you have an existing business, you can use analytics to see who’s visiting your website (and who’s not).

Be Creative

Using data to inform your perception is important, but in the end, this exercise is as much creative and intuitive as it is data-driven. If you’re reading this, you’ve probably been alive in this world for at least a couple of decades, and you know the archetypes that make up our community tapestry. There are soccer moms, yuppies, tech bros, heartland traditionalists, early adopters, grandparents, DINKs (dual-income no kids), members of the military, college students, teens, tweens, seniors, white collar, blue collar, and everyone in between. For B2B companies, you’ll mostly be thinking of job roles, like executives and corporate buyers. 

Think about the type of people you expect to shop at your business, and create a visual image in your mind’s eye. Give that person a name, and begin using your powers of empathy to really get to the bottom of why they’re coming to your business. What unmet needs do they have? What does your business bring them in the way of convenience, price savings, or improved quality? Tap into your inner fiction writer to create a biography for them. Think about what software they use and what other brands they buy. If you’re a fan of the Myers-Briggs Type Indicator personality test, plot where they fall on the four personality metrics. If you’re not so into the MBTI, use DISC, horoscopes, or whatever other personality inventory system holds meaning to you.

What Can I Do With the Customer Persona?

You may be wondering what the value of this exercise is, beyond simply understanding your customer base and tweaking your business model to better serve them. While that is plenty enough reason to engage in the customer persona exercise, there are other practical reasons for doing this. 

Once you have a firm grasp on your target audience, you can use that knowledge to develop a more effective marketing strategy. For example, you can use your customer personas to create targeted marketing campaigns that speak directly to your ideal customers' needs and desires. 

Customer personas can also be used to enhance the customer experience. Understanding your customers' needs and pain-points allows you to improve your products and services to better meet their needs. This can result in increased customer satisfaction, loyalty, and, ultimately, revenue.

Another application for customer personas is to develop a more effective sales strategy. Salespeople can better connect with potential clients if they understand who their ideal customers are and what they value or need. This can lead to more successful sales and better customer relationships. 

Finally, creating customer personas is only the first step in a long process of understanding your customers. As your company grows, so should your customer personas. Keeping your personas up to date and researching your target audience on a regular basis will ensure that your marketing, sales, and customer service efforts are always aligned with your customers' needs.

Where Does the Persona Belong in the Business Plan?

The most important reasons for creating a customer persona are in practical applications as discussed above. But customer personas can certainly be used in a business plan. The Market Segmentation section tends to be a little bit dry. An entrepreneur can write this section by only doing the bare minimum, simply making a bulleted list of the categories of customers that will shop at their business. Those who are more diligent will describe each customer segment with a paragraph. The most dedicated will do their best to find research backing up their assumptions and cite them within the Market Segmentation section. 

Adding a customer persona to your research can really make this section of your business plan stand out. Because of their length, business plans can become daunting to read, so as an entrepreneur, your job is to channel your inner writer and anticipate when your reader’s eyes might start to glaze over. As a pro, I can tell you that it can often happen right around the Market Segmentation section, because it comes just after the data-heavy Market Analysis. You can keep your reader’s attention by adding some visual interest here.

Then, you can refer back to your customer personas in the Marketing Strategy section, mentioning how each strategy is designed to tap into something that you know about your target customer, whether that be their frustration points or their preferred shopping outlets.

Creating Customer Personas is Just the Beginning

Developing customer personas is an important step in any business strategy, but it is only the beginning. You can create a more effective and efficient business strategy that will help you better meet the needs of your customers by using your customer personas to inform your marketing, sales, and customer service efforts.