Knowing your customer is at the centre of selling successfully. But who exactly is the customer? This is the million-dollar question that start-up founders and B2B sales and marketing heads should be asking. And answering it is simple when an ideal customer profile (ICP) for the organization exists.
- What Is An Ideal Customer Profile?
- Why Create An Ideal Customer Profile?
- What Does An Ideal Customer Profile Contain?
- What Is A Buyer Persona?
- What’s The Difference Between An Ideal Customer Profile And A Buyer Persona?
- Creating Your Ideal Customer Profile
- Avoid The Common Errors Of Building An Ideal Customer Profile For B2B Lead Generation
What Is An Ideal Customer Profile?
An ideal customer profile is a business that your product or service can benefit most from. You have something that can solve the pain points the business faces.
It follows that if you can provide the business value, they can provide value in exchange. Such as buying your product or service, referring you to other businesses that can benefit from your product or both.
Why Create An Ideal Customer Profile?
Your sales and marketing teams should know which businesses they need to focus more of their time on. The ICP acts as a reference to separate quality prospects from all incoming leads.
Chances of sales are higher when you’re able to speak to the needs and challenges of the leads that come in. In other words, an ICP allows you to personalize messaging to businesses that have a need for your product and are more likely to convert to paying customers.
If you offer different products and services, an ICP is a useful tool to target the right products/services at the right customers.
Building customer profiles can help you make sense of the requirements of subsets within your customer segments. This makes account management more streamlined and efficient.
Sales and marketing are stronger together and deliver better results when they work collaboratively. An ICP provides a common definition of the business your sales and marketing teams must prospect and persuade.
One way in which this works is when the marketing team has to create content at various stages of the customer journey. Marketing messages encourage potential customers to take action. At some point, they are ready to be handed off to the sales team.
When this happens, the sales team should be ready with the information and scripts that are consistent with the marketing messages put out by their comrades in the marketing division. The ICP helps in ensuring this alignment.
What Does An Ideal Customer Profile Contain?
An ICP can contain several customer characteristics, but some matter more than the rest. They include and are not limited to:
- Size of the organization (employee count, revenue, customer count and so on)
- Years in operation
- Size of the department that can benefit from your product/service
- Industry they serve
- Their customers
- Geographic location
- Their pain points and requirements
- Their management profiles
- Buying process
- Their readiness for your product/service
Naturally, including all customer features, you can think of in the ICP would make it bloated and complex. Select those that are most relevant to the outcomes you want for your business.
- Company with over 1,000 employees
- Revenue in excess of $10 million
- Budget of $10,000 or more
- Offices in the UK, USA or Australia
- Have a need to automate processes
- Getting buy-in from executive board is a challenge
In essence, an ideal customer profile contains the most important qualities of the ideal buyer. After you’ve identified your ICP, you need to think about the decision-makers at those companies that you must engage and persuade.
Effective engagement is possible when your sales pitch, marketing messages, blogs and other brand messages resonate with these decision-makers.
Buyer personas are a useful tool to tie your content to your buyers’ needs and pain-points.
What Is A Buyer Persona?
A buyer persona is a semi-fictional representation of a decision-maker within your ideal customer profile.
If you’re selling an automation tool, you can create buyer personas such as Operations Manager Joe, CIO Shelly or Start-Up Founder Bill. For each, you can add details such as demographics, motivations, pain-points, goals, buying patterns and things that matter to them.
Buyer Persona: Operations Manager Joe
- Education: Masters in Business Administration
- Goal: To improve process efficiency and employee productivity
- Challenge: Balancing quality and growth on one side and budget and waste on the other
- Resources for information: Internet, specialized websites, networks within the industry, industry conferences and social media
- Expectations: Low-cost deployment, fast ROI
What’s The Difference Between An Ideal Customer Profile And A Buyer Persona?
Your ideal customer profile defines who your most valuable customers are. But you sell to individuals within the company.
Connecting with them on a human level makes the difference between winning or losing a sale. Buyer personas offer ideas on how best you can connect with people within the target company on a human level.
You need an ideal customer profile and a buyer persona. The former will help you define who you should target.
By humanizing those targets through buyer personas, you will be able to personalize your sales and marketing messages, and handpick the right employees for your different accounts.
Creating Your Ideal Customer Profile
The good news is that building an ICP isn’t difficult or particularly laborious.
But it will need to be done with care, with the involvement of sales and marketing teams, and in keeping with certain best practices explained in this section. Let’s dive in.
Use What You Already Have
Customer profile data exists across your various business systems and assets, including:
They’re a good starting point for the data you need. The owners of customer data in your organization are also key sources for building the ideal customer profile.
They include sales and marketing, customer support, operations, product and finance leaders. Each type of data owner can bring their perspectives and experiences to help understand the perfect client your organization should woo.
Identify Your Best Customers
From the data you’ve gathered from systems and people, identify your 10-15 best customers. Base it on who is bringing you the most value and how much value you’re generating for them.
Your research up to this point will suffice for identifying high-value customers that make a substantial impact on your bottom line.
For a better understanding of the value you’re creating, you can supplement what you already have with insights from your customers.
Get customers on the phone, request them to fill out a survey or send emails asking them for the specific feedback you need.
Look For Common Characteristics
The next step is to find the attributes your best customers share. Inspect the list you have at a deeper level to identify attributes that aren’t immediately clear.
For example, matching customers on employee strength, geographic location or the information sources they trust is straightforward.
But similarities in usage patterns and purchase behaviours are not immediately obvious and require more study.
Assign Varying Importance To Attributes
As mentioned previously, noting every minute detail about customers does not serve any purpose. If anything, it introduces complexity to the ICP-building process.
In the previous steps, you selected important, relevant attributes from the customer data you had and that which you collected. The list itself could be pretty exhaustive, and that’s a good thing because the next step is to assign priority to the attributes.
Some common characteristics shared by your customers factor more heavily in their decision to buy than others. Pinpointing them is easier now that you have gathered every key customer that needs to be considered.
So, while the 30 attributes in your list have varying degrees of impact, your teams should focus on 5-10 that they understand and can work with to formulate sales, marketing, customer support and pricing strategies.
Organize The Information In A Template
An ideal customer profile is a visual tool describing the perfect client for your organization. It acts as a sales and marketing planner and a reference when you’re having a hard time connecting to your customers.
Different types of ICP templates are available online and customizable to users’ needs. You can, therefore, create your own template but using one pre-designed for you does speed up ICP creation.
Note that the template we’re referring to is the skeletal structure to organize your information. It isn’t a template containing questions or prompts on the customer attributes that can form your ICP. Generally, such templates do not meet the needs of organizations looking to create highly targeted ICPs.
Avoid The Common Errors Of Building An Ideal Customer Profile For B2B Lead Generation
As the ICP is a guide for lead generation and informs sales and marketing across the board, it needs to fulfil certain requirements. When collaborating on building the ICP, watch out for certain issues that come in the way of having constructive discussions.
The target customer profile will be in use by multiple functions and departments in your organization. Its definition should fulfil three requirements: clarity, commonality and objectivity.
- The definition should be understandable and clear to all users. It should be jargon-free and use simple, direct language.
- All the teams that use the ICP should agree on its definition.
- The definition should be supported by customer data.
There are three ways to make the definition objective:
Use Nouns And Verbs Rather Than Adjectives: Using subjective language prevents users from getting a clear idea of the ideal customer. Instead of describing the company as ‘large’, say ‘a company with more than 1,000 employees. This approach forces you to add detail and build out a targeted, precise ideal customer profile.
Be Specific: Based on your goals, research and the experience of your teams, you may give priority to a particular market segment. Your ICP should reflect this decision. So, if growth stage companies form a majority of your high-value customers, and you want to go after this segment, then your ICP should be specific with regard to company stage.
Quantify: The benefit of using quantifiable measures is that it leaves no room for doubts or confusion among users about who they should target. Where possible, ensure specificity with regard to revenue ($5M), tools (enterprise-level CRM), stage (ex: Series B onwards) and other attributes.
Best Practices For Productive Discussions
Prepare for a debate on who the ideal customer is! This is inevitable when you bring different teams together to share their experiences with customers. Discussions are important as they encourage data sharing, which is necessary to develop and achieve alignment on the ICP.
Few points on leading productive discussions that help build consensus and a complete and accurate ICP:
Champion Data, Exclude Opinion
When you welcome opinions from various teams on defining the ICP, some will present anecdotes to defend their ideas for what the definition should include. Anecdotes are unreliable evidence and as such, should be left out of the discussion. To avoid conflict, let teams know in advance of the requirement to bring data to the table.
Sidestep Tricks And Traps
No matter how much faith you have in your people, it’s better to be extra cautious in accepting everyone’s views as genuine. Consider the possibility of an individual, function or group using tricks to support their theories on what the ICP should include. And have a way to challenge those views outside the meeting, which is the next best practice.
Do A Follow-Up Analysis
Test theories and assumptions outside meetings to verify their validity. Assign someone with the skill to perform the analysis. You can gain some lead on this at meetings by using scenarios to test the assumptions. But a separate analysis is also necessary to separate truth from fiction.
Revisit Your Ideal Customer Profile As Needed
An ICP is not set in stone. It can change as you acquire new information about your customer or with changes in your business model or product range. Revise the ICP on a yearly basis and keep everyone updated on changes so they work with the latest version.
Changes to the original ideal customer profile do not significantly impact sales and marketing strategies. If the business expands to entirely new markets, then the natural route would be to create new ICPs containing the unique attributes of customers in those markets.
Our parting advice would be to review your current systems to understand whether customer data is available at your fingertips. A CRM, for example, is necessary to collect, store and share all information related to the customer across the organization.
Without a CRM, making the best use of customer data for creating your ICP can become needlessly challenging. Are you’re a growing business looking to buy a sales CRM for your growing business, but deterred by the cost? Have a look at Kylas for its flat fee, and free training and onboarding.