What are Premium Customers? (And How to Find Them)

A company’s main audience is comprised of both its premium customers and general prospects. Like a pyramid, your premium customers sit at the top, followed by prospects, while general audiences encompass the remainder of sales at the bottom. 

When a company searches for new customers, casting the largest net possible is typically not the best strategy. General audiences often require stronger (and more frequent) marketing efforts to convert, resulting in more spending for fewer sales. 

In contrast, companies that prioritize their premium customers often achieve a higher return on investment (ROI) on their campaigns due to this audience’s tendency for larger purchases, frequent conversions, and extreme dedication. 

This buyer persona, through their buying habits, preferences, and characteristics, serves as the foundation for your marketing message and targeting efforts. If your messaging is not resonating with your premium customers, it is highly unlikely to convert anyone else in your audience list. 

But what characteristics define a “premium customer”?

1.) Highest Paying Customers

The Pareto Principle states that 80% of outcomes are a result of 20% of inputs. Similarly, the 80/20 rule can apply to customers, in that your top 20% of clientele make up roughly 80% of your profits – either through large purchases or repeat conversions. 

Your premium customers, therefore, are a part of that top 20% of your audience – sometimes even your top 5-10% of customers. Meaning that this segment is the most likely to spend more money than all the remaining sectors on average. 

Because this group is more likely to spend more per campaign than other audiences, companies that target these customers often see positive campaign metrics year after year, with a stronger push towards selling their more lucrative products and services.

2.) High Lifetime Value

Premium customers not only spend more than general audiences on average, but they also stay on the books longer. 

Most businesses would prefer customers to convert year after year, instead of only once.

Perhaps a business model can survive with one-off purchases from general audiences, but retaining your customers for as long as possible ensures a positive future outlook for the company. 

Subscriptions are the most common type of repeat purchases; however, the same can be said for seasonal services and fundraising campaigns. 

A “one and done” customer may keep the office lights on, but maintaining a consistent cash flow from loyal customers is always the goal for long-term company growth. 

3.) Highly Motivated Buyers

When searching for premium customers, it is not enough to simply look out for prospects that are likely to convert – they also must be highly motivated to ONLY buy from you.

What differentiates your company from others within your industry? Your premium customers need to have their wants and needs satisfied with your company’s products and services, and not with a competitor substitute. 

A customer is only considered a PREMIUM customer when they find value in your company and ONLY your company.

Keeping them motivated through impactful messaging and personalized offers encourages future sales, making your premium customers an essential segment of your audience base. 

How to Find Premium Customers with Direct Mail

With a proper data modeling strategy, direct mail can target your lookalike customers (prospects that walk, talk, and spend like your premium customers) in every campaign.

This methodology helps identify the prospects that best match your ideal audience profile, are highly likely to convert, and offer continued support with every campaign. 

But identifying premium customers is only the first step. 

Every campaign creates a new opportunity to further refine your prospect list as new data flows in. This helps improve both audience targeting metrics and your campaign messaging, as more information helps you determine which ad copy produces the best responses.