Lili’s Accountant AI harnesses businesses’ financial data and the latest industry information to provide business owners with personalized, instant recommendations about their businesses’ finances. It provides personalized guidance based on a user’s unique banking and accounting activity, as well as patterns from similar businesses. Lili’s Accountant AI also responds to questions based on extensive training and the latest tax policy updates. The questions being asked reveal not only the challenges business owners face around taxes and cash flow, but also their expectation that their financial platforms deliver more—instant, personalized answers, integrated tools, and proactive guidance to help them make better business decisions.

The questions asked through Accountant AI reveal the issues keeping small business owners up at night. More than half (52%) of all questions were about taxes—whether it’s choosing the right tax structure, maximizing deductions, or legally lowering liabilities. Within that group, 27% of questions focused specifically on finding the best tax structure or maximizing deductions, underscoring the urgent need for clarity on how to optimize taxes.

Audit anxiety was also evident: about 16% of questions centered on audits, either understanding what triggers them or how to avoid one altogether. And nearly 20% of questions addressed raising capital, budgeting, or growing the business—showing that while taxes dominate concerns, business owners are also eager to plan for expansion and long-term success.

The top five questions that small business owners have asked Lili’s Accountant AI, include:

• What is the best tax structure for my business?
• How can I maximize deductions for my business
• How can I minimize my business taxes legally?
• What are my options for raising capital?
• What triggers a business audit, and how can I prepare for it?

The questions are not surprising, since the NFIB released a survey in July reporting that nineteen percent of small business owners find that their taxes are their biggest problem. The last time the NFIB received that same feedback was in July 2021. NFIB Chief Economist Bill Dunkelberg states that “Small business optimism remained steady in June while uncertainty fell. Taxes remain the top issue on Main Street, but many others are still concerned about labor quality and high labor costs.” 

“Our Accountant AI was built to give small business owners instant, personalized answers to their most pressing accounting questions – drawing directly from their own financial patterns,” says Lilac Bar David, co-founder and CEO of Lili. “It’s no surprise that more than half of all the questions we receive are about taxes, whether it’s structure, deductions, or compliance. This shows just how critical it is to provide AI-driven tools that not only save time but also give business owners the confidence to make smarter financial decisions.”

The post Lili, the Small Business Banking Platform, Unveils New Data from Accountant AI: Over Half of Small Business Owners’ Questions Are About Taxes appeared first on Powering Your Business Growth.

What you need is a client onboarding process. In other words, you need to have a set list of steps to follow every time you take on a new client. 

Let’s take a look at what you need to know to create your own client onboarding process. Note that while we’ll mostly focus on onboarding new clients for service-based businesses, we’ll also briefly cover customer onboarding for e-commerce store owners or sellers on sites such as Etsy or Amazon. 

What Is Client Onboarding?

Client onboarding refers to the process of beginning work with a new client or customer. It takes place during the period of time between agreeing to conduct business together and actually starting your first project or delivering the product. 

However, client onboarding involves more than just an agreement to do business. There are a lot of little details to work out that will set both you and the client up for a successful working relationship. 

During client onboarding, you and the client establish the parameters of your working relationship, including scope of work, payment, communication expectations, turnaround times, availability, and so on. It’s also the best time to exchange important legal documents such as tax forms, set up productivity systems, and address potential challenges upfront. 

Following a pre-established, step-by-step client onboarding process ensures you get all of those details taken care of before the work begins. 

Do I Need a Designated Client Onboarding Process?

The simple answer is yes: if you are going to have clients, you definitely need a client onboarding process. 

There are several reasons for this:

• Prevent scope creep: A common problem for business owners is taking on extra work without the work reflecting in their pay. For example, the client may ask for a “small favor” here and there, or you may find yourself spending way too many extra hours on a project because additional requests were added last-minute. This is called scope creep, and it often happens because expectations weren’t clearly established beforehand. 
• Streamline the process: If you don’t have a plan for how to go about onboarding new clients, the process is almost guaranteed to take longer, and you’re likely to run into problems or hiccups along the way. This not only wastes time, but also makes you look less professional. 
• Eliminate confusion: When you’re just getting to know a brand-new client, there are a lot of questions to ask, expectations to set, and pieces of information to communicate. That means it’s easy to get confused — or for your client to get confused — if you don’t have a set process to follow. 
• Ease uncertainty: Just as there’s a lot to communicate when you take on a new client, there’s also a lot of potential uncertainty. Having a plan to follow will help both you and your client know exactly what’s expected. 
• Reduce churn: Client onboarding is your chance to demonstrate the value the client will get out of working with you. If that experience involves confusion, uncertainty, or lots of unexpected complications, they may decide it isn’t worth their time. If, however, the client onboarding process is efficient, professional, and clearly communicated, they’ll be much more likely to stick around. 
• Encourage future referrals: When you impress new clients, not only are they more likely to continue working with you, but they’re also more likely to recommend your services to people they know.
• Ensure nothing falls through the cracks: With so much to keep track of, it’s easy to forget about small details — questions you need to ask, forms you need to send, information you need to file away, etc. If you have all of those details listed out in a client onboarding checklist, however, you’ll know which steps you’ve completed and which still need done. 

While onboarding new clients without a specified onboarding process is technically possible, it’s not recommended. Better to put in a little extra work now to save time, effort, and frustration down the road.

Client Onboarding Best Practices

Because every business is unique, the client onboarding process will look a little different for each person — and sometimes for each client. But there are a number of key components that are important to include no matter what kind of business you run. 

Here are some client onboarding best practices to keep in mind:

1. Send a welcome packet: As part of your client onboarding checklist, put together a standard set of documents, questions, and information that you’ll send to every new client. This should include things like a questionnaire to gather all of the client’s information that you’ll need for your records, guides about how your business operates and what the client can expect from you, and so on. 
2. Leave nothing to guesswork: While you don’t want to overwhelm your new client, it’s important to be as detailed as possible as you iron out the details of your new working relationship. Spell out all of your expectations and requests, try to anticipate and answer any questions the client is likely to have about working with you, and be sure to ask all of the questions you still have about working with them.  
3. Put their mind at ease: Put their mind at ease: Your new client has just made a commitment involving time, money, and trust in another person. It’s likely they’re feeling a little nervous about it, especially if they’ve never worked with someone in your industry before. Be friendly and welcoming, and communicate confidence that you can and will do your best to uphold their trust.
4. Follow through on the expectations you set: One of the best ways to set your new client’s mind at ease is to demonstrate your ability to deliver on your promises. When you agree to a deadline, meet it.
5. Make things easy on the new client: Another way to ease your new client’s worries is to make the client onboarding process super easy on their end. Make sure to give them everything they’ll need and keep any forms or questionnaires you send them as simple and straightforward as possible. 
6. Don’t procrastinate: Once the client onboarding process starts moving, don’t let it stop moving or slow down until it’s done. Waiting until the last minute to ask questions or send over documents risks delaying the actual work — and getting paid for it. 

Client Onboarding Checklist

Now that we’ve established the importance of having a client onboarding process and looked at some key principles for carrying it out, it’s time to create your client onboarding checklist. Once again, this will look a little different for each business, so be sure to adjust the details to suit your needs and business offerings. 

With that said, here are the basic steps to include:

• Initial Talks: Determine whether you and the client are the right fit for each other and discuss the terms for working together. 
• Make It Official: Sign the contract spelling out your exact terms, deliver any tax documents, send over the first invoice, etc.
• Nail Down the Details: Send a welcome packet covering everything you and the client need to know to officially start working together. 
• Get Organized: Make sure you’re all set on your end. Enter your client and project information into whatever project management software you use, create folders on your desktop and in your email to collect documents, records, and anything else you might need to access in the future related to this client. 
• Get Started: Follow up on any lingering unanswered questions or requests and start working on your first project.

Now, let’s take a look at each of those steps in more detail. 

Initial Talks

Chances are you’re probably in this stage now, or have just finished it. Maybe you’ve conducted a successful email marketing campaign, guiding the client to the point of offering them your services, and have received a positive response. Maybe the client was referred to you by another client in your network. Or maybe they found your website organically and reached out to you first. 

Based on how the relationship was initiated and how much the client already knows about you and your business, you may need to provide additional information before you can really get down to business. For example, if they reached out to you organically, they may not know much about you and your business yet. In that case, you’ll want to have introductory materials on hand that you can share with them. 

Once you’re both ready to proceed, it’s time to dive into the details:

• Discuss the terms, including project type(s) and scope of work, rates, timeline, and deliverables.
• Ask about communication preferences (e.g., email vs. text messages, relevant project management apps, etc.)

Overall, the goal here is to ensure you both know what to expect moving forward and that you’re ready and willing to continue. This stage may be completed in a phone conversation, video call, or in-person meeting, or may take place over a series of emails.

Make It Official

You and the client have agreed on the terms and begun setting expectations, so now it’s time to get that agreement in writing. The main item to take care of here is of course signing the contract, but there are several other documents and action items to include as well.

These include:

• The contract, clearly spelling out your terms
• Any required tax documents for both the client’s and your own records
• The first invoice (or an agreement about when and how the initial payment will be made if you aren’t charging upfront)

Remember, the more you get in writing now — even if just via email — the easier it will be to avoid misunderstandings or, in worst-case scenarios, settle disputes later on. 

Nail Down the Details

Time to send that welcome packet and make sure you’re both on the same page. This is your chance to eliminate any lingering confusion, so don’t be afraid to ask questions and to take the lead in setting boundaries and expectations. 

There’s a lot of information to give and request during this stage, including:

• Your hours of operation and a reiteration of preferred communication methods
• The client’s expectations in terms of turnaround times, delivery methods for finished projects, etc.
• Any questions or potential challenges that have come up since your last conversation
• Any other information you or the client needs to know before you can start the work 

Don’t forget to express your enthusiasm to begin — this is a welcome packet, after all!

Get Organized

Now that you have all the relevant information, you need to get that information filed and organized so you can easily find it again when you need it. 

If possible, try to finish getting everything organized before you start working. But if you need to start the first project immediately, just do your best to get organized as quickly as possible.

Here are some important pieces you’ll want to make sure you have set up and easily accessible:

• Place any physical materials in a clearly labeled file folder
• Create a digital folder for the client (and subfolders for projects as needed) and collect all digital files related to that client in the folder
• Set up a folder or label for that client in your email provider, and sort all of your email communication with them into it, so you can find them easily in the future
• Enter the client’s information into your project management system
• Schedule the timeline you and the client have agreed upon in your calendar, with milestones for every step of the process
• Follow up on any loose ends like unanswered questions or files you have yet to receive
• If the work will be recurring, make note of that in your calendar and/or project management systems, too, along with your invoicing plan (for example, will you set up automatic invoices each month, or will you need to remember to create and send one on specific dates?)

Getting organized will take time, but making an effort to do it as soon as possible will save time and potential problems once the work has officially begun.

Get Started

Once you’ve gathered all the necessary information, answered your client’s questions, and set expectations, you’re ready to start. Congratulations: you’ve officially onboarded your first client!

Don’t worry if the process didn’t go 100% smoothly from start to finish — now that you have a better understanding of how it works (and what doesn’t work for you), you can fine-tune your client onboarding checklist and be even more prepared for the next time. 

Customer Onboarding Process

But what if your business doesn’t deal with clients? Do you still need a process for customer onboarding? Absolutely!

While service-based businesses may only work with a few clients at a time, product-based businesses like Etsy or Amazon sellers don’t have much of a limit for how many customers they can sell to. So, having a solid customer onboarding process that you can repeat with every new customer is an important time-saver. Not to mention, it increases your chances of converting one-time purchasers into recurring customers.

As you create your customer onboarding checklist, you’ll want to follow this basic process:

• A welcome email to thank them for their purchase
• Clear communication about the progress of their order and its delivery, if applicable
• A request for feedback/reviews once the product has been successfully delivered
• An invitation to check out other products 

Step 1: Welcome Email. 

Thank the customer for their purchase and include relevant order/tracking details. Here’s an example of what that might look like:

“Hi [Customer Name],

Thank you for your order. We hope you love your new [product purchased]! 

Your purchase will be on its way to you shortly. [Insert relevant production and shipping details, including tracking number, expected delivery date, etc.]

Thank you,

[Your Name or Business Name]”

Step 2: Order Progress Updates. 

Provide updates about the production and shipping process, inform the customer of any delays or issues with their order, and share when the customer can expect to receive their order (if possible). 

For example, you might send one email when the order has entered production, another when it has shipped, and additional emails if there are any unexpected delays. 

Step 3: Request for Feedback/Reviews. 

After the product has been successfully delivered, ask the customer to leave feedback about your business and the product. 

Here’s an example of what this might look like:

“Hi [Customer Name],

How are you liking your [product purchased]? We’d love to hear about your experience purchasing from us. Would you take a moment to leave us a quick review? 

 [Link to review the product]

Thank you so much!

[Your Name or Business Name]”

Step 4: Invitation to View Other Products. 

Invite the customer to check out other products they may be interested in purchasing. Showcase popular items or items that are similar to what they’ve already purchased. This step could be included in the same email as the request for reviews, or sent as a separate email. 

Still not quite sure where to start? Check out these other great customer onboarding examples. 

Just the Beginning

When your new client onboarding process runs smoothly, you set the stage for an equally organized working relationship and demonstrate professionalism from the very beginning. 

But, of course, the client onboarding process is just the beginning of that relationship. Once you’ve set your expectations and boundaries, it’s up to you to continue to uphold them by producing quality work.

The post How to Conduct a Successful Client Onboarding Process appeared first on Powering Your Business Growth.

Regularly reconciling your bank records is crucial for any business’s success. This process gives you a true understanding of your cash position, helps manage cash flow, and allows you to quickly identify and correct any errors. By catching discrepancies early, you can make smarter financial decisions and support your business’s growth and stability.

Here are the basics of how it works and a step-by-step guide to performing one for your business. 

What is bank reconciliation?

Bank reconciliation refers to the process of comparing your bank statement to your accounting records and ensuring they’re in alignment for the same time period. If you find any discrepancies, you investigate and work to reconcile both records with the actual financial activity. 

The Benefits of Regular Bank Reconciliations

Performing regular bank reconciliations offers numerous advantages for maintaining the accuracy and health of your financial records. First and foremost, reconciliations provide a complete and precise understanding of your business’s financial position, enabling you to gain valuable insights into your cash flow. This practice helps ensure that you know exactly how much cash you have on hand, which can reduce the likelihood of bounced checks or failed payments.

Additionally, bank reconciliations allow you to spot and correct discrepancies early, helping to prevent fraud, theft, and errors from growing into bigger problems. By regularly comparing your bank statements with your accounting records, you’ll be able to catch issues early.

Accurate financial records are also essential for tax filings, shareholder updates, and loan applications. Timely reconciliations ensure that your books are up-to-date and ready for any reviews by the IRS, lenders, or investors. By maintaining a consistent and accurate reconciliation process, you can foster confidence with your stakeholders—whether they be vendors, customers, or shareholders.

Step-by-step guide to bank reconciliation

Now that you know the basics of what bank reconciliation is and why it’s important, here’s a closer look at how to perform one yourself. 

1. Choose a review period

While it’s a good idea to check your transaction history daily for red flags, you’ll want to identify periods to formally review your banking activity. For example, if you want to perform quarterly reviews and it’s April 1st, you’ll review records from January 1st to March 31st. On the other hand, if you want to start performing monthly reconciliations, you could do so on the 1st of each month for the previous month.

Reconciliation frequency depends on your business’s transaction volume. At least once a month is ideal, especially if you handle bookkeeping yourself. For smaller businesses, monthly or weekly reconciliations may suffice, while larger companies with more transactions, like restaurants or retail stores, might need daily reconciliations.

2. Get the records you need 

Next, pull up your bank statement(s) and accounting record(s) for the chosen review period. Bank statements can often be requested online or at a branch while accounting records can be pulled from your accounting software provider or recordkeeping files. With Lili, you can log onto the app to see all your records in one place.

3. Review your bank transactions

Once you have the records you need, review the transactions on your bank statement line by line. Check to see if each transaction is included in your accounting record. For most business owners, the balances often don’t match owing to slight discrepancies like unrecorded charges or deposits, outstanding checks, and more. If anything is missing or incorrect, take note of the transaction details. 

4. Review the entries in your books

After you finish verifying the transactions on your bank statement, switch to your accounting record. Once again, review the entries line by line to see if every record in your books is also on your bank statement. If any are missing, take note of the transaction details. Using accounting tools that connect directly to your business banking can help streamline this process by automatically syncing your data.

5. Investigate and correct any discrepancies 

If you finish reviewing both documents and your books match your bank statement perfectly, you’re done! If not, you’ll need to investigate the reasons behind the discrepancies. For example, here are some common causes: 

• Missing accounting records: An incoming or outgoing payment wasn’t recorded on your books.
• Incorrect accounting records: An entry on your books was recorded incorrectly, such as adding the wrong dollar amount for a payment. 
• Deposits in transit: A deposit is in transit so appears on your books but not on your bank statement yet. 
• Outstanding checks: A check has been sent and the expense was added to your books but the money hasn’t been pulled from your account yet. 
• Bank errors: Your bank made an error such as charging you for the same transaction twice or processing a transaction in the wrong amount. 
• Unrecorded bank service fees: Your bank charged a service fee that needs to be added to your books. 
• Fraud/theft: An unauthorized individual gained access to the funds in your bank account and spent them. 

Once you identify the cause, reconcile the differences by adjusting your records or noting any other explanations.

6. Check the end balances 

After identifying and fixing all discrepancies, run the numbers again. Your reconciled bank statement should now match the balance on your accounting record. If it doesn’t, repeat steps three through six again. 

Bank reconciliation example

Here’s an example. 

Dana checks her books and sees that her small business generated $25,000 in revenue in July while incurring the following expenses:

• $25 in bank fees
• $100 in insurance
• $100 in phone and internet services
• $6,000 in labor
• $1,200 lease
• $200 in utilities 
• $500 in inventory
• $4,500 in taxes 
• Total expenses: $12,625

While she should have $12,375 left over in her business bank account, she checks her balance and sees $13,550. To figure out why, she performs a bank reconciliation.

Dana finds that the $1,200 lease check she sent hasn’t been cashed yet so the funds are still in her bank account. Additionally, the bank charged her an extra $25 fee that she didn’t include on her records. 

To reconcile both sides, she adds the extra fee to her accounting record and notes the outstanding rent check on her reconciled bank statement.

Streamline bank reconciliations in real-time with Lili 

Reconciling your bank account regularly — at least monthly — helps to ensure your financial records are accurate, your bills are paid as planned, and you can spot discrepancies early. However, doing so manually tends to be tedious and presents a higher risk of errors. If you’d like to speed up the process, consider Lili’s combined banking and accounting software which seamlessly keeps your bank account and books in sync. Every transaction is automatically categorized, allowing you to quickly reconcile with a simple swipe and keep your books up to date. Transactions feed directly into your financial reports, offering real-time cash flow insights and ensuring you don’t miss any deductions. Lili simplifies the process, making it easier to stay on top of your business finances.

Streamline your finances with ease – Try Lili free for 30 days!

Lili is a financial technology company, not a bank. Banking services are provided by Sunrise Banks, N.A., Member FDIC. Accounting software is available to Lili Smart and Lili Premium account holders only; applicable monthly account fees apply. For details, please refer to your Sunrise Banks Account Agreement.

The post Bank Reconciliation: What Is It And How To Do It Right appeared first on Powering Your Business Growth.

But here’s the reality: as much as 91% of new business often comes through referrals or word of mouth. That’s a significant growth opportunity you don’t want to leave untapped. And the good news? Asking for a referral doesn’t have to be intimidating. With the right approach, it can feel natural, professional, and mutually beneficial.

Let’s explore three simple, stress-free ways to confidently ask your clients for referrals.

Choose the Right Timing

No matter what you’re asking for, timing is key. If you ask for a referral at the right time, not only will your client be more inclined to say yes, but you’ll also make it a lot easier for them to follow through. 

Some good times to ask are:

• After (successfully) finishing a project. You’ve completed all the work, delivered value to your client, and fulfilled expectations (or, even better, exceeded them). Try following up with a simple note asking if they know anyone who could use your help on similar projects. 

• When renewing a contract. This client values your work and wants to continue working with you. More than likely, they’d be happy to recommend your services to people they know. 

• After receiving positive feedback. When the client sees value in the work you do for them, they won’t feel weird about sharing that appreciation. Thank them for the positive feedback, and simply ask if they know anyone who would benefit from the same services they’ve just complimented you on.

Also keep in mind that referrals don’t only have to come from current clients. But asking for a referral from a previous client out of the blue after not speaking to them for months or years isn’t the best idea. 

To avoid such a situation, keep in touch with previous clients, even if it’s just sharing a helpful article or resource here and there, to keep the line of communication open. Doing so will increase the chances of repeat business and also make it more likely that they’ll think of you when someone asks them about businesses they’d recommend.

Be Direct & Specific

Don’t overthink it — just ask! Beating around the bush is a waste of time and might leave the client confused about what you really want.

When you do ask, be as clear and concise as possible. Instead of leaving it open-ended, ask if they know anyone in your target audience who could benefit from your specific offering. This makes it easier for them to recall the right person and increases the chances that the referral will be a strong fit for your business. 

Additionally, there’s nothing wrong with reminding the client of specific things they’ve said about your work or results you’ve gotten them, and then asking them to share those comments or results with people they know. 

If you’re still too nervous to ask outright for a referral, you can ease into it by asking for a testimonial to display on your website. Just writing the testimonial can sometimes prompt a client to refer you to others even without you directly asking, but more importantly, asking for something small first (and getting it) can help you feel more confident asking for something bigger later.

Make it Easy

Above all, asking for a referral should be as easy and painless as possible for both you and the client. You might want to make or download a template, so you don’t spend hours each time agonizing over every single word. 

If you’re routine-oriented, make yourself a standard operating procedure (SOP) that builds referral requests into your regular client communication processes, so it becomes just another part of running your business instead of a big, scary task you have to talk yourself into doing. 

When you reach out to your client to ask for the referral, make sure they have all the information they need. You could even send them a nicely formatted list of your services, rates, and contact information, so all they have to do is forward it.

Ask for Referrals with Confidence

Remember, clients who enjoy working with you and value your services want you to succeed and will be more than happy to put in a good word for you. But, if you never ask, they may not know what kind of clients to refer you to or whether you even have the capacity to take on new work. 

Now that you have some simple strategies in your referral request toolkit, it’s time to practice using them. The more you ask for referrals, the easier and less intimidating it will feel — and the sooner those referrals will start sending new clients your way.

The post 3 Stress-Free Ways to Ask Clients for a Referral appeared first on Powering Your Business Growth.

This question is actually never possible to fully answer, no matter how long you’ve been in business. Not to get too philosophical (we’re more about action than contemplation around here), but it’s good to ask yourself this pretty regularly. 

You know this: our world never stops changing and evolving. This includes everything from the platforms and technologies available to us at a macro level, to what’s on your playlist as you read this article. We live in a time of flux and change, and so do our customers. So as your business and brand evolves, never get complacent when it comes to knowing who your customer is. 

Why define a target audience

This is one of the big differences between running a real business, and just chasing a hobby. Once you get serious about scaling your business into something full-fledged, focusing your time and attention becomes critical. A dedicated business banking account helps strengthen your financial foundation as your audience grows.

This starts with defining who it is you’re serving in the first place. In other words, defining a target audience helps to:

• Attract people more likely to become customers 
• Spend marketing and advertising dollars more effectively
• Build a stronger brand voice that sets you apart 
• Get more creative with your marketing 
• Develop a relationship with a core audience that offers you better feedback, creates deeper bonds, and lays the groundwork for community growth 

Target market vs target audience

These terms sound the same. Yet understanding the difference can open up doors for your business, in many ways. It can have implications not only for your marketing strategy, but also for your product development and brand.

Your target market is the full set of end consumers who could become customers of your brand. Your target audiences are the people you focus on in advertising, based on a set of common characteristics. These are also referred to as “segments”. Your target market is who your brand must appeal to on a universal level, and your target audiences are like chunks of that audience that you reach through specific marketing channels and campaigns.

Let’s look at an example.

Nike’s target market is famously defined within their mission statement as “every athlete” – which they define as anyone with a body. So, a pretty broad group of people. When you have a global $3B marketing budget, you can afford to go after every person with a body. But even a global leader needs to break down their market into specific audiences, and you can see on their website this is split between men, women and children. Breaking it down further, their products are organized by sport and occasion. Runners, basketball players and general fitness seekers are targeted with different messaging, in different places, for different products. 

Nike’s Target Audiences

• Men
• Women
• Parents
• Players of specific sports
• Fashion-oriented 
• Performance-driven 
• Cost-conscious 

Below are some examples of this in action. Notice how each ad is targeting a unique audience through its messaging and imagery. 

Fashion-savvy women:

Source

Cost-conscious consumers: 

Source

A range of audiences are included, from parents to serious athletes:

Source

It’s best to start big and identify the broadest definition of someone who could be interested in your product or service. From here, you can sharpen the definition to go after a particular subset. 

Common ways to define a target audience

There are many different ways to slice and dice an audience, and these may shift over time. Below are some of the major categories to consider when thinking about how to expand your target audience definitions. 

Demographics – Age, location, marital status, household income, children, gender and occupation are some of the most basic ways to define an audience. It’s good to start with a general understanding of your audience in these terms, but some are more important than others depending on your brand. It can also be tricky when lumping people together in this way, depending on the product or service. For example, millennials and GenZ make up over 50% of the US population, so are an attractive audience for many brands. Yet, they’re also the most diverse population in US history, which means their belief systems, attitudes and behaviors are not one-dimensional. For example, ideas and norms around gender are shifting and expanding, which require a different way of thinking about how to cater to a male versus female audience. Demographic information is useful, but it’s not enough to paint a full picture of your future customers. 

Psychographics – Here’s where things get a bit more interesting. Thinking about the psychological situation and needs of your audience puts things into a much more useful frame, especially in terms of product development and marketing. This requires having a sense of empathy for your audience and their mental state. Are they worried or anxious about something? Or are they seeking adventure and novelty? 

Interests – This may seem obvious to some, but knowing the interests of your audience (beyond your product or service) can yield useful insights, especially around marketing placement and messaging. For example, Red Bull targets those interested in adventure and adrenaline-fueled activities which is why it sponsors athletes and Formula 1 teams. 

Behavioral – Behavioral targeting looks at specific actions taken by an online audience, to determine what ads and messaging will be the most effective. For example, you can target people who have visited your website with an ad on Instagram reminding them about your product or service. That’s known as behavior-based targeting; it has nothing to do with who they are beyond the fact that they indicated an interest by visiting your site. 

Media – Some brands focus their energy on understanding how their audience spends their time consuming media. For example, if you’ve focused until now on Instagram and Twitter, but your audience spends a lot of time on YouTube or TikTok, this could be an opportunity for you to tap into a new segment and attract a new source of traffic.

Pulling this together, here’s how a brand like Nike might segment its target audiences:

Each of these groups would be researched and analyzed to determine the size of the opportunity, their motivations and pain points, their media habits (to understand where/how to reach them) and how this impacts creative messaging. 

Nike can afford to spread its marketing budget across many different audiences, over a long period of time. But now let’s shift our focus and think of how an independent business owner can identify target audiences to make better marketing decisions. 

How to identify your target audiences

Now that you know some of the ways you can describe your audience, let’s look at how to figure out who these people are. 

1. Write down what you already know! Odds are you have a good sense of who a typical customer for your business could be. Perhaps you were inspired to start your business based on this knowledge – you discovered a particular unmet need and went after it. But have you taken the time to focus on who they are as people, not just “customers”? This is a useful exercise for even the most experienced business owners. Using the above categories, see how much you can write about your audience as if you were describing them for the first time. 
2. Google Analytics. Assuming you have a website for your business, there’s a world of insight to gain from Google Analytics. Seeing where your customers are coming from can tell you something about their interests and where they spend their time online. Do they visit you from YouTube or other social platforms? Are they on mobile devices or do they visit from a desktop computer? What pages do they spend the most time looking at? All of these are clues that help you understand who your audience is, and how to best communicate with them. 
3. Social media followers and comments. Have you spent time looking at who is already following you online? Browse through some of the profiles of your more active followers, and get familiar with what makes them tick. What do these people seem to have in common? Are there any common interests or pain points you may have missed? Taking time to regularly review your social media engagement is critical to scaling a business. For more information on social media marketing, check out our blog post on the topic.
4. Social media analytics. Facebook, Instagram and Twitter all have what’s called “native analytics” right inside the platforms themselves. There can be a treasure trove of information about the demographics and interests of your visitors, sitting right there waiting for you. Social media data is particularly useful because you can quickly see what’s resonating based on engagement.
5. Reviews and ratings. If you’re already in business and have garnered a few reviews on sites like Google Business or Yelp, be sure to read what past customers have said about you. Hopefully, it’s only good things — but either way these comments can reveal hidden nuggets and insights into what people value the most, or would like to see more of. 
6. Customer interviews. No better place to go than the source. Ask your existing customers who they are, how old they are, what they’re interested in and where they spend the most time online. This can be done by sending out surveys via email, or just taking a poll on social media. 
7. Competitor research. Visit the websites and social profiles of your competition, and try to see who they’re going after. Often you can see what segments are most important simply by looking at the menu, or reading a few blog posts. On social, check out their followers and look at their bios for common traits. 

Tips for defining your target audience

Once you’ve performed market research and gained insights around the different possibilities for defining your target audience, it’s time to find them! Social media is a good place to start because it’s where your audience probably already is, it’s relatively easy to get set up with an ad account, and you get feedback pretty quickly. 

1. Think of it as an investment. Spending money on a target audience is a defining moment for any small business owner. It’s about making a commitment to the long term, by placing some money on the table in order to learn more about your audience and use those insights to scale your business. Organizing that spend through accounting tools also makes it easier to track ROI and adjust your strategy.
2. Pick one channel to start. You don’t need to be everywhere at once, and you also don’t need to force people to change their media habits. In other words, where is your audience already spending their time online? Instagram is a good place to start for most audiences, and it’s relatively easy to set up campaigns. 
3. Have a “test-and-learn” mentality. This will make all the difference in the world. You don’t need to know everything about your audience from the get-go. But the sooner you start promoting your business, the sooner you’ll get familiar with them and the more comfortable you’ll be with describing who they are. 
4. Set a testing budget. It can help to create a designated budget just for target audience testing! Say the first month or two you are focused purely on understanding who your audience is, based on what ads work better than others. From there, you can adjust. While it’s possible to run campaigns for $10/day, they likely won’t be shown to enough people to generate any interesting results, and you won’t get much data from which to draw any real conclusions. Start with at least a week-long campaign, if not a month, bearing in mind that it’s an investment in your business. 
5. Create personas. A “persona” is a fictional profile meant to represent your target audiences. It’s a great way to humanize your audience by assigning them a name and a brief description of their story or situation as it relates to your business. For instance, if you’re a nutritionist you might have a persona for someone who is overweight and interested in weight loss, and another for someone in good shape but looking to simplify their diet. Giving them names and personalities creates a stronger connection to who they are as people – not just random internet users. This builds empathy and can be a great tool for understanding an audience. 
6. Figure out who your audience is NOT. This can be just as important as identifying who they are, and a good way to do this is through testing. You can also get a general feel for this the longer you’re in business – and make a note of it. Knowing who you are not interested in can illuminate new ways to think about who you are going after! 
7. Don’t go overboard with segmentation. Especially as a small business owner, you can easily drive yourself nuts isolating every aspect of your potential target audience. This often leads to an unwieldy volume of creative options, test campaigns, and budget. Start small, identify two or three segments, and focus on attracting as many of those people as possible through relevant messaging and ad placements. 

Identifying your target audience with clarity is one of the most important steps in building sustainable business growth. Start at a high level, defining the lowest possible denominator is – regardless of which marketing channel and targeting options. Tracking those investments with the right tax and expense management tools also helps you maintain a healthier bottom line as your business expands.

If you take away one key point from this article, it’s this: the more empathy you have for your audience as people (vs. target consumers) the better your marketing will be.

The post How to Find Your Target Audience appeared first on Powering Your Business Growth.

If you’re considering using PayPal, Venmo, or another peer-to-peer money exchange app for your business, here are a few things to be aware of.

Risk of Noncompliance with Tax Laws

The Treasury Inspector General for Tax Administration (TIGTA) released an internal audit report in spring 2021 addressing challenges in tracking and monitoring peer-to-peer payment applications. Because payments made with such apps are not always reported and can often get lost in a mix of business and personal transactions, the IRS has had difficulty monitoring reporting and tax compliance with businesses using Venmo or PayPal. This has led to increased scrutiny of P2P apps. Because compliance is difficult to define in the case of P2P apps, you could be unintentionally non-compliant simply out of confusion or inaccurate tracking of expenses and revenue.

This risk is even worse for LLCs and corporations, as using peer-based payment apps puts them at risk of liability for business debts. When you’re incorporated, business and personal expenses need to be as distinctly separate as possible.

Tracking Business vs. Personal Transactions

If you’re using PayPal or Venmo, you’re responsible for manually tracking all business expenses and payments, since the apps won’t distinguish them from personal transactions the way professional banks and invoicing software do. This can lead to a major headache come tax season, as you’ll need to go through and manually report every individual business transaction.

In terms of business expenses paid through Venmo, the money requests themselves don’t qualify as formal invoices. This means you also need to collect invoices from any vendors or sellers you purchase from for your business and pay in this way. 

PayPal is slightly better in this instance as they do have some invoicing capabilities for business accounts, but it is still your responsibility to manage overall tracking.

Invoice Templates

Looking for an Invoicing solution? Check out our free invoice templates! Read More

Privacy and Security Issues

Venmo has a unique functionality beyond just money exchange: it also operates a bit like social media, with a newsfeed sharing transactions between friends. Their goal is to make transactions more of an experience than just a simple transaction, but it can cause privacy issues for you and your clients if your transactions aren’t marked as private.

Think of Venmo as a social money app like Cash App or Meta Pay rather than a true bank or accounting software. Yes, you can send and receive money with it. If fraud occurs on your account, you will likely get your money back, but you can’t expect the same reliability and heightened security that you get with an app specifically designed for business. In fact, Venmo discourages transactions with anyone you don’t know personally, so it’s not necessarily ideal for a business owner.

Again, PayPal is a slightly better solution, as they offer options specifically designed for business owners, but there are still limitations and compliance issues due to the overall casual and social nature of the platform.

Tax Reporting Issues with Clients

It’s important that business owners take into account the client experience when making decisions. As the person on the receiving end of invoices or payment requests, your customers cannot pay you via Venmo without their own Venmo account! Even if you’re not an LLC and have no problem tracking your business expenses manually, this may put your client in the uncomfortable position of mixing their business and personal expenses.

PayPal doesn’t have this issue, as your clients can pay a PayPal invoice without creating an account. Yet both of these apps can lead to a dreaded tax complication if not handled properly: double reporting!

In order to maintain their own compliance with the IRS and tax laws, both PayPal and Venmo will send the IRS a 1099-K form on your behalf at the end of the fiscal year if you meet or exceed the requirement of $20,000 USD in gross payment volume from sales of goods or services and more than 200 transactions in a calendar year (this is the updated requirement for 2022). This generally will make things easier for you, but can be flagged for double income reporting if your clients issue you a 1099-MISC as well.

Basically, double reporting occurs if the IRS records both 1099s as separate records of income, meaning you’re liable for taxes on that 1099 twice. So if you don’t want to overpay your taxes, be wary of the double reporting risk when using PayPal or Venmo, and do your own tracking of expenses and income so you don’t miss errors like this on your tax return.

How to Maintain Tax Compliance

The best way to ensure compliance and properly track business transactions made with PayPal or Venmo is by creating an account exclusively for business purposes and connecting it with a business bank account. This way, you automatically keep your business and personal finances separate, solving the largest issue in terms of P2P apps and taxes.

If you prefer consolidating your banking, expense tracking and invoicing into one place, you may consider trying out Lili’s Invoicing Software. Instead of trying to juggle a combination of Venmo or PayPal and a business bank account separately, with Lili you can do all your banking and accounting in one secure location.

The post How Using PayPal and Venmo Affects Your Business Taxes appeared first on Powering Your Business Growth.

Tezza: Aesthetic Photo Editor

Image via Tezza

Tezza is an amazing photo editing tool that helps you create a seamless look and feel on your grid. Loaded with photo and video presets, it makes defining your brand’s color palette super easy. Your page’s aesthetic/color palette should be strong and stand out, while also remaining true to your brand. 

All you have to do is search through Tezza’s premade presets and choose the one that feels on-brand. Once you find the presets and filters you like best, stick with them! This will help determine the aesthetic you want your page to follow and guide you to any user-generated content you’d like to repurpose on your page. 

When you post consistent color themes, it shows your followers who you are and enhances your brand’s online presence. And who doesn’t love brand awareness? Does the $4 monthly cost deter you? Since it’s for your business, Lili can sort that monthly transaction as a business expense.

Canva

Image via Canva

Next up, Canva! Canva is the BEST tool for any text or graphic-based posts. Not to mention, Canva makes it simple to create personalized templates that you can re-use again and again, so you don’t have to create everything from scratch, every single time. Having pre-made templates also sets you apart since it enhances your brand’s look and feel, creates consistency, and gives you a more elevated and professional experience. 

The second best part about Canva is that their templates are super flexible, meaning you can easily customize your designs no matter where they’re going. In the app, you can save your designs in IG story format, square, and even 4:5, helping you create the perfect post for its unique place. If you want to create an Instagram Story with multiple frames, you can do that within the app and export it easily, making posting even more seamless. We’re not all magically graphic designers, and that’s where Canva comes in.

Later

Image via Later

Now that you have pretty pictures, templates, and text posts it’s time to build your content calendar. In my opinion, there is no greater tool than Later when it comes to scheduling your posts on Facebook, Instagram, Twitter, Tiktok, Pinterest, and LinkedIn. You get to see your posts in a calendar view, and the best part… Later will publish the post for you! 

Automating your posting schedule takes the pressure off and keeps you from second guessing your punny captions. When using Later you also have access to their in depth analytics portal that helps you better understand exactly what’s happening behind the scenes of each post. Another huge plus for both Later and Canva is that they are also accessible on desktop, meaning you can get even more granular when planning and creating your posts for the month. The desktop version of Later allows you to see comments coming in and answer directly from the platform, making sure you never miss a comment or question from your followers! 

Time to Start Creating

Now I know what you’re thinking, it can’t be that easy!! Well, I hate to break it to you but it is! When you create enough content for each platform you start to see what works and what doesn’t. That’s the beauty of social media: instant results. With any small business or foray into freelancing, we all know it’s just a deep dive into an abyss of learning experiences, and that’s how you have to view your social platforms. It’s important to post consistently to feed the beast, but it’s also important to have fun and engage with your audience.

The post 3 Apps to Make Your Social Media Stand Out appeared first on Powering Your Business Growth.