Two of the most common issues I see in B2B companies are a lack of customers or attracting the wrong ones. The “wrong” customers are your “poor-fit leads” — they’re the right customer for someone, just not your company.
It’s easy to understand why a lack of customers is an issue; you need customers to sell your product or service, otherwise your business will crash and burn.
Poor-fit leads can be a trickier problem though. It means you’ve somehow attracted potential business you don’t want because their needs, budget, market, or ethics don’t align with yours. Not only are poor-fit leads unlikely to convert into repeat customers, they also absorb valuable resources. Your company can’t afford to spend time and energy cultivating relationships and bringing leads through a dead-end sales funnel.
Both problems have a number of causes — and not understanding your ideal customer is at the root of many of them.
Whether your business is after more customers or stronger-fit leads, the first step you should take is to lay out your ideal customer profile.
What is an ideal customer profile?
An ideal customer profile (ICP) is a company that fits your offering perfectly. They have all the qualities that allow them to benefit from your product or service.
These qualities often include (but aren’t limited to):
- Budget — They can afford what you offer, but aren’t expecting a much more expensive and complex solution
- Industry — Their products, services, and processes are exactly the kind that would benefit from your offering
- Geography — You sell to their region, and they’re ideally situated to buy, use, and recommend your company
- Maturity — Whether they’re a start-up, seeking funding, bootstrapped, or backed by investors, the age and size of their organization match your product
- Approach — Their values, history, vision, and mission all align with how you’d like your customers to operate
- Pain points — Your offering can solve the problems they seek to remedy
- Purchase process — Their consideration, decision-making, and payment options match how your business fosters and converts leads
If you’re concerned this perfect customer doesn’t exist — they don’t. An ICP is a fictitious creation designed to guide you toward the right customers for your business.
Importantly, though, ICPs are based on credible data, which avoids drawing unsubstantiated conclusions from hunches. So, while they may be fictitious, the value an ICP brings to your organization is real.
ICPs are often confused with buyer personas. While there are similarities between the two, ideal customer profiles and buyer personas are two separate concepts. In my article ICP vs. buyer persona vs. user persona: The secret to personalized marketing, I walk you through when and how to use each.
Put simply, an ICP is your ideal business while a buyer persona is the target individual you want to convert, such as a B2C customer, the user in an organization, or a company’s decision-maker.
Why crafting your ideal customer profile is important
To understand why an ICP is important for your business, let’s revisit the scenarios mentioned at the beginning of this article: a lack of customers and poor-fit leads.
Crafting an ideal customer profile can salvage these scenarios or prevent them from happening in the first place. It tells your team exactly which organizations to target and why. The advantage? Prospecting provides direction and clarity.
Craft the right content and messaging for your ideal customer
An ICP will also help you create content, marketing messages, and buyer journeys that connect with the right businesses. As a result, you’ll attract happier buyers more quickly.
In their 2022 B2B Buyer Report, Sana found 50% of eCommerce sites fail to meet the expectations of B2B buyers. As such, you stand to make gains from understanding your customers better. For example, according to TrustRadius, nearly 100% of tech buyers in 2022 want to self-serve their buyer journeys. This means they want to research your offering (via pricing information, customer reviews, case studies, and communities and forums) before speaking to a sales rep.
Having an ICP in place allows you to grasp and meet the expectations of your B2B customers. In the case of tech buyers, crafting an ICP would help tech companies refine their self-service content and, in turn, boost efficacy.
Tailor the customer journey
Finally, an ICP allows teams to tailor the buyer journey.
Learning an ideal customer’s needs, interests, and blockers helps sales and marketing teams adapt funnels to create unique journeys that are successful for everyone involved. They can also strategize repeat custom or continued purchase goals through the lens of an ICP, which increases customer lifetime value.
Use your ICP to predict the expected behavior flow of your ideal customers, then craft user journeys that meet these expectations. As a result, you’ll be able to create seamless user experiences, progress the buyer journey, and minimize customer frustrations and disruptions.
Improve account-based marketing processes
Ideal customer profiles improve a wide range of account-based marketing (ABM) processes by providing clarity, refinement, and fresh ideas — music to the ears of B2B businesses reviewing costly task lists.
Most respondents to DGR’s 2022 Survey said their marketing budgets are increasing in 2022, with half saying spend is focused on ABM. Keep up with the competition by honing the key tool that underpins ABM: your ICP.
When to use an ICP
A multitude of everyday processes benefit from the introduction of an ICP. From guiding company decisions to fine-tuning your marketing strategy and optimizing sales prospecting, ICPs provide several advantages for your business.
Guide business decisions
Every business decision you make should be based on data. Using your ICP to guide decisions within your company helps clarify the reasons behind the choices you make.
Let’s take developing new offerings as an example: An ICP can influence whether you add functions, remove capabilities, or even change surface-level design features. Referring to your ICP when developing new offerings will help ensure you make changes that benefit your ideal customers.
This isn’t meant to discourage innovation though; rather, sense-checking B2B service or product changes should begin with an ICP.
Fine-tune marketing strategies
An ICP defines who to target and why, making it a powerful tool when crafting your marketing strategies.
Your ICP should underpin your marketing and content strategy. As I wrote in my blog about startup content marketing, “you need to build content that relates to your audience and converts them to customers.” An ICP is a crucial reference point to accomplish that.
Use your ideal customer profile to determine what formats, channels, and messages should underpin your content strategy. An ICP can also help you lay out the positioning of single content pieces or touch points, such as defining your webinar audience.
Tailor sales prospecting and identification
As mentioned above, an ICP allows you to optimize your sales prospecting and identification. Once your team pinpoints what kind of businesses are most desirable, their lead qualification processes will become easier and quicker; they’ll know exactly which types of companies to pursue and which ones to leave alone.
Sifting through leads with an ICP can take many forms, including:
- Realizing a lead is a poor fit and excluding them from the funnel
- Prioritizing relationships to foster and leaving others alone to observe (if they have the potential to develop into better-fit lead)
- Remembering that an ICP is about the fit of the account, not the individuals you encounter. If a lead aligns with your ICP, but your contact is reluctant to communicate, keep discussions open and light
When a lead matures and begins to form a more personal relationship, it’s time to bring in your buyer personas for a collaboration with your ICP. Combining your buyer personas with your ICP will bring a deeper understanding of your leads and can help you close more deals.
Tactics for crafting an ideal customer profile
Though an ideal customer profile details a perfect, imaginary client, it’s the product of hard data. The information behind your ICP is what makes it a valuable tool for your organization.
So, how do you go about collecting reliable customer data? A number of tactics exist to gather information and craft a robust ICP.
Dive into customer data
Review customer information held on your CRM platform. Are there companies that jump out in your memory as being a near-perfect client? Extract their data, pool it with others that were similarly successful for your business, and find out what they have in common.
When reviewing customer data, you may also want to look at factors such as which customers spend the most money at your company, or what business types have the longest and most stable relationships. Dig deep into your customers to identify patterns around customer performance. Then, use this information to inform your ICP.
Consult customer-facing teams
Add a human touch to your ICP creation process by consulting staff who talk to customers day in and day out. Ask them what they think makes the perfect customer. Remember, encourage them to keep answers about the account, not their personal contacts within that account. Speaking to customer-facing teams such as sales teams, account managers, or customer service reveals insider knowledge on customer buying processes, sign-off lengths, and any pain points that are too nuanced to be captured in a regular CRM.
Your customer-facing teams may provide valuable insights you would have missed by simply reviewing data points on a screen.
Interviews and surveys
Also gather primary data externally. Interviews and surveys are a great way to learn more about customer behaviors, pain points, expectations, and purchasing cycles.
They’re also easy methods to pursue, with a multitude of tools available to run panels, calls, questionnaires, and more. Alternatively, you could commission a specialist company to perform market research for you.
Open-ended questions yield richer answers. Try to engage customers in more open discussion with questions such as, “How has our product helped solve a challenge in your company”’
Use interviews and surveys to speak directly with both potential and existing customers and discover their needs. This clear line of communication will help you better understand which organizations are the best fit for your ICP.
Review and revise
As soon as you create an ICP and share it with the relevant teams, put a recurring event into your calendar to update the profile. Your business will continue to grow and change, so your ICP needs to adapt as well.
I recommend a quarterly review. Frequently reviewing and revising your ICP helps make sure it aligns with your ideal customers and allows you to readjust broader business operations to suit it.
To be effective, your ICP needs to be up to date on customer buying behaviors as well as any internal changes such as a company restructure or new offerings. This can be as simple as gathering team leads on a 15-minute call to agree to the ICP’s continued relevance, or as detailed as starting over with fresh surveys and market report analysis.
Wrapping up — Honing your organization’s ideal customer profile
Any organization mature enough to undertake B2B account-based marketing needs an ideal customer profile. This powerful tool will enrich teams across a business, from sales and marketing to product development, leadership, operations…the list goes on.
According to an Ironpaper and SurveyMonkey interview with 180 top business leaders, the main challenges impacting B2B revenue are increased competition, evolving consumer needs, and buyers requiring more education. An ICP is strategically positioned to combat these challenges and more.
So, to overcome the main hurdles impeding business revenue while ensuring your business messaging, prospecting, and user flows speak directly to the right type of customers, you need to craft an ICP — starting now.
Set a budget and timeline for your process. It’s easier to refine an existing entity than to create something from nothing. Then, collect consumer data from internal and external sources and search for patterns.
Before you know it, your ICP will be refining processes, saving time and energy, and helping you attract more of the right customers, which means more conversions for your organization.