Looking to maximize the impact of your sales & marketing efforts? Maybe the key is not doubling-down on your investment or targeting a larger market. On the contrary, the solution may be to niche down and prioritize. And, in order to do that, you'll need to have a concrete idea of who your most valuable customers are. That is, an ideal customer profile.
In this post, we'll dive into:
- What's an ideal customer profile
- The difference between an ideal customer profile and a buyer persona
- How a good ICP can make life easier for your sales and marketing teams
- How to create an ideal customer profile, step-by-step
- How to keep your ICP updated
- Our favorite tools for creating a useful ICP
Let's get started!
What's an Ideal Customer Profile?
An ideal customer profile (or ICP) is a model of your most valuable customers. But, who are they?
Your most valuable customers may have:
- The highest retention rate out of any customer segment
- A particularly short and extremely cost-efficient buying process
- The highest customer lifetime value out of any customer segment
And, most importantly, your ideal customer profile should see so much value in your solution that they find it essential.
For instance, if you provide a social media management solution, you should understand which companies consider that there are thousands of viable alternatives to your product, and which ones can't do without you.
This second type of customer is your ideal customer profile. It’s essential to understand who they are and which product features are really making a difference.
Before we dive into the impact of having an ideal customer profile, let's look at two frequently asked questions.
Is an Ideal Customer Profile the same as a Buyer Persona?
After reading our ideal customer profile definition, you may be wondering if ICPs are buyer personas.
A buyer persona is a model of an individual that's facing a challenge that your solution could solve. This model includes job position, behavioral attributes, and more. A buyer persona may represent an ideal buyer. And it makes sense to prioritize a certain buyer persona vs others.
But in B2B, an ideal customer profile isn't the model of an individual buyer, but of an organization. Which organizations are your most valuable customers? And, which organizations see the most value from what you provide?
Should you have both an ICP and a Buyer Persona?
Don't get us wrong, individuals (and team dynamics) matter, especially when you’re selling to companies.
It’s key to understand:
- Which crucial stakeholders will advocate for your product internally
- Which stakeholders will be gatekeepers
- Which positions are most likely to be skeptical of your product’s impact
- Which positions may feel threatened
Without great buyer personas, you can't identify target contacts and kick off the sales process. So, don't throw your buyer personas out the window. But a fitting persona at an ill-fitting company won't make a good lead.
What's the Impact of Having an Ideal Customer Profile?
Now that you know what's an ideal customer profile, let's dive into the impact of having one.
Your ICP can inform all areas of your business (even feature development). But there are two teams that will instantly benefit from the clarity and focus of an ICP.
- Your sales team
- Your marketing team
In this section, we'll dive into why an ICP is key for more efficient sales & marketing processes. Especially, we'll focus on our first-hand experiences shaping our ICP as a B2B brand.
How a Clear Ideal Customer Profile Facilitates Sales
Are your representatives spending their precious time chasing after the wrong leads? This can be catastrophic. Especially, if they're using expensive account-based marketing campaigns.
Having an ICP will help your sales team to prioritize impactful accounts and maximize the ROI of your sales efforts.
In concrete terms, implementing ICPs contributes to:
- More intentional and scalable prospecting
- Faster sales cycles, on average
- Higher closing rates
- Lower CAC
When you concentrate your efforts on your ICP, you can begin to:
- Recognize important patterns that lead to winning or losing a deal
- Systematize your sales process without losing efficiency
A simple but very clear example is cold outreach.
Let's say you're trying to cover as much territory as possible by pitching to as many companies as you can with no clear direction. When writing a prospecting email, you will:
- Go for a vague "catch-all" message that will be generic and easy to ignore
- Try to force your prospects to see value in a solution that's not really for them
But, if you’re always targeting a single type of company for whom your solution is an ideal fit, your bulk emails will feel fresh and personal. Even if you've sent the same message to hundreds of prospects.
Additionally, since they're such a good fit, companies matching your ICP may only require a short and fast-moving sales process. This will especially be the case if you share relevant social proof and strategize around a time-sensitive offer.
All of these factors will contribute to a customer acquisition cost that simply makes sense.
Why a Clear Ideal Customer Profile Maximizes Marketing ROI
It’s easy to be spread too thin when it comes to marketing. There are dozens of platforms you have to be on. And, especially in B2B, it's not uncommon to see companies that produce tons of content with almost no ROI.
One of the causes behind excessive but unproductive marketing activities is a lack of focus. And an ICP is key to getting back on the right path and making your content more effective.
The best content:
- Addresses real user challenges, goals & objections
- Introduces your solution as a promising alternative/complement
Once you understand who are your most valuable customers, it becomes easier to learn:
- What platforms actually inform their decision-making process
- What tone, topics, and formats they prefer when connecting to brands like yours
From there, you can detect which content types will bring you the best results, and organize your investment accordingly.
You should spend most of your time solving your ICP’s problems. Any content that doesn’t meet that goal should be extremely well-justified. For instance, your Instagram presence may not target your ICP, but if it’s a recruiting tool that helps you build your employer brand, it’s still valuable and worth maintaining.
How to Create Your Ideal Customer Profile
Now that you know what’s an ICP and how it makes a difference, it’s time to start shaping your own.
If possible, we recommend you reverse-engineer your ICP. Let’s take a look at how to get it done.
How to Reverse-Engineeer Your ICP
To get started, set clear criteria for customer success. What characterizes a successful customer experience, in your case?
For instance, for us at Postdigitalist, a successful client experience involves:
- Long-term collaboration (retention)
- Long-term quantitative & qualitative results
- Fast content production processes, with minimum client intervention (due to high content quality, not due to low prioritization)
So, when shaping our ICP, we asked ourselves which partners usually met that standard. Next, we listed the traits that characterized them. For instance, we found that 80% of our most loyal and satisfied clients are companies where the founder is directly involved in vetting content.
Once you have clear ICP criteria, look at company data, and try to find which traits all your best customers share. But, what kind of data should you have in mind? Easy: Firmographic and technographic factors.
What Are Firmographics & Technographics?
Firmographics and technographics are characteristics that allow you to segment firms. Firmographics relate to an organization’s background, structure, and performance. Technographics, on the other hand, reference what use they’re doing of available technologies in their field.
When building your ICP, take a look at firmographic and technographic factors, such as:
- Funding stage
- Team size
- Tech stack
- Budget allocation
Ideal Customer Profile Example
To help you make sense of how firmographic and technographic factors help you shape your ICP, let’s dive into an example.
Let’s suppose you run a technical SEO consultancy. Your ICP could be:
US-based new media companies that recently raised a Series A, with at least $3M in funding. They already have an in-house SEO person, and their website runs on a custom, enterprise-grade CMS.
Let’s break this ICP down. Our fictional company:
- Wants to work with US-based companies, because they understand the US market, and are a cultural fit
- Wants to work with new media companies because they have a solid success record in that sector, they understand it and know how to help companies grow
- Prefers post-Series A companies because their internal processes are already robust enough
- Prefers companies with at least $3M secured in funding, to make sure their collaboration doesn’t weigh on their finances, and that they have considerable runway
- Works best with clients that already have in-house SEO talent, that way their advisory can really shine, and their strategy is implemented frictionlessly
- Works best with clients with a custom, enterprise-grade CMS, because that’s the baseline they need to give them a competitive edge
How to Create an ICP, Pre-Launch
But, what if you don’t have a success record to tap into? What if you’re pre-launch? In that case, we recommend you do some competitor intelligence.
Do your research, and aim to answer these questions:
- Who are your competitors’ most loyal and successful customers?
- Are you a promising alternative to your competitors, for this segment?
- Are you able to target an unserved segment, that doesn’t match your competitors’ ICP?
- Which market segment would it be?
- What features would make you a good fit for that sector?
- Why would those features be relevant?
Should You Update Your ICP?
At this point, you may be wondering if you should update your ICP as your company grows. The answer is yes. Like buyer personas, ICPs are tools. And tools should facilitate your decision-making process and give you a sense of clarity. Not force you to ignore what you know is true, or restrict your analysis.
So, as you learn more about your customers, get more experience, and move upmarket, you’ll have to update your ICP.
Our Favorite Resources to Help You Build a Great Ideal Customer Profile
Diving into the ICP challenge for the first time?
Here are some tools that will help you get your ICP right:
- Cleabit’s Find Your Ideal Customer Profile ebook
- Unusual Ventures’ ICP and Persona Notion templates
- How to use BANT to qualify your prospects, a guide from Hubspot
- How to apply your ICP when prospecting on Apollo
Content Marketing that Connects You to the Right Customers
In this post, we explained what an ideal customer profile is, and how it can help you optimize your sales & marketing efforts. Especially, when it comes to content creation.
Looking for a content partner that takes the time to understand your product and connect with your most valuable customers? You’re in the right place. Get in touch today and start growing with (actually) valuable content.