Congratulations! You have an incredible product, your office building sits pretty in the heart of the city and you have an outstanding sales team to enjoy working with every day.
Everything; check, check check!
But how do these contribute to your sales cycle? I mean, how much value do the right people place on your product? How many deals does your sales team close every day?
If you’re reading this, I believe you don’t have a positive answer to these questions, but not to worry, you’re not alone.
Over 37.5% of new companies do not have an ideal customer profile or accurate buyer personas. What this simply means is that some marketing and sales teams do not know who their ideal customer is.
In this article, we will explore topics around the building or identify your ideal customers.
- What is an ICP?
- What should you include in your ICP?
- Benefits of building an ICP
- Differences between an ICP and a buyer persona
- Identifying your ideal customer or building an ideal customer profile in five simple steps
What Is An Ideal Customer Profile?
As a B2B company, an ideal customer profile is one that represents the type of company most likely to buy your products and services, stay loyal, and recommend you to others.
In addition to the company’s size and business, you may also need to know the activities they engage in, as well as why they are likely to want your product or service.
Usually, a fraction of the data in the ideal customer profile template is based on current customers and people who have purchased from you in the past.
The goal of ICP development is simple: Identify the accounts most likely to become customers. Objective measures of value like annual contract values (ACV) and lifetime values (LTV) facilitate the segmentation of target accounts and go-to-market alignment.
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What Details Should Your Ideal Customer Profile Contain?
The ideal customer profile is formed by examining your entire organization and current customers.
Basic company data such as the products you offer, and how quickly you can produce them, can help you create your ideal customer.
The characteristics you would like all your customers to possess are also key.
Depending on your product, service, or company, your sales rep may want to include other data points to help recognize the right market segments for your company.
Industry
You should target customers and create your ideal customer profile templates based on companies operating in an industry where your products or services can provide benefits.
Pain points
These are problems your ideal customers face every day that your products or services can help them resolve.
For example, your product help salespeople send cold emails, your buyer personas would represent sales reps with the pain point of a low conversion rate.
Activities
Your product or service should be used as part of the daily operations of your ideal customer’s business.
For example, if you create software for mixing and mastering music, your ideal customer should be a sound production studio.
Location
It is possible that your company is oriented towards supplying a particular region or refrains from transacting in others.
Size and revenue
You do not want to target a customer who doesn’t make enough revenue.
These questions would help you identify high-value customers ;
- How many employees are on the payroll? LinkedIn can help here.
- How many people make the purchasing decision?
- How much do they turn over every fiscal year?
Your ideal customer should be capable of affording your product. The amount of money they have to use toward purchasing from your company impacts how much profit you can make.
Benefits Of Building an Ideal Customer Profile ICP
Streamline marketing efforts for the marketing and sales team
Besides sales teams, you can also use the ideal customer profiles to provide a vast ocean of data to help marketing teams streamline their marketing strategy and push relevant content toward the right target market.
Assist the relevant department and teams within the organization
Product teams could use the ideal customer profile ICP to identify if they’re including the right features and developing the right add-ons for the ideal client, product teams can use an ideal customer profile to define ideal customer profiles.
To produce and sell a quality product or service, it’s crucial that all groups, not only the product team, working on it have a common perspective on who their ideal customer is.
Improved purchase process
Companies and sales reps who are customer-centric could use the existing customer data and find common attributes and identify similarities with new prospects and potential buyers right from the awareness stage.
A data-driven company can access its customer base and its successful sales cycle to identify how past deals were closed with them.
For example, what medium of communication was used? What quantity or price were they willing to buy or pay? What sales channels were most effective? etc.
Identify opportunities
Sales and marketing teams, especially those from large companies can use the buyer personas to create a customer list and recognize who the target customer is and focus on marketing to them for increased win rates.
Regardless of the company size, marketing teams could leverage the ICP to find companies with the highest value or simply streamline their marketing efforts towards customers with the most value.
Encourage existing customers to call again
Apart from helping potential customers through with a quick buying experience, the marketing team can improve on their sales strategy using informed data and behavioral attributes of current customers to promote repeat business.
Differences Between An Ideal Customer Profile And A Buyer Persona
The buyer persona is based on real data about customers who have bought from you in the past as well as market research.
Using buyer personas gives your company structure and context, emphasizing your content, allocating team resources, and achieving alignment across your organization.
Ideal customer profiles vs. buyer personas: what’s the difference?
Basically, an ideal customer profile represents a fictitious company that is most likely to purchase or subscribe to your product or service, while a buyer persona is a decision-maker from that company who has the power to make the purchase on behalf of the company.
Buyer personas describe the varied purchasing patterns of different companies within your ideal customer profile, this could be a specific job title or pain points in your existing customer base/industry.
Specifically, at Sloovi, our ideal customer profile consists of a business-to-business marketing company with a sales process and CRM. We identify salespeople and those with the job titles empower them as typical buyer personas within these companies, such as sales managers, marketing managers, sales and marketing operations, and analysts and data scientists.
How to Create An Ideal Customer Profile In Five Simple Steps
Ideal customer profiles focus on one person per time. If you chase every lead you receive, your sales teams will burn out with poor performance. Ideal customer profiles are the best way for businesses to prevent this problem.
Ideal customer profiles help you define the target audience to whom you sell and ensure measurable returns.
A detailed and accurate definition of the ideal customer profile can be regarded as a crucial part of a successful marketing strategy. Some sales staff have no idea of the best way to define the ICP for determining sales, so we have a solution in five simple steps.
1. Examine your satisfied customers
Ideally, it is best to start with your current customers. They fell in love with your product and purchased or subscribed because it resolved some or all of their pain points.
Get a list of companies who are happy using your product and appreciate you for selling it to them.
In SaaS, these are companies that have left positive reviews or have renewed their subscription at least once.
2. Look out for their common attributes
After making a list of potential buyers of your product, the next thing to do is look through to find similarities you can leverage to find your ideal customers.
Some factors you should consider include;
- Monthly Recurring Revenue
- Marketing interest
- Location of company
- Company size
- Industry/ market share
- Common pain points
- Budget – how much are they willing to pay for your product
3. Prioritise lifetime value over customer acquisition
After narrowing down your list, it still needs to be refined. Remember, we are looking for the ideal customer, we don’t need ten companies.
So far, we have evaluated who is happy and is getting the best value from your product. It’s time to see which customers are most valuable to your company. Customers who would be with your company for a very long time.
time. This will show they remain happy and loyal beyond the honeymoon period, and that their need continues.
4. Gather additional data
We now have a smaller list of companies we want to work with. The next step is to build up on the information we have about them.
Here are a few ways to achieve this;
Surveys
Send out a friendly email inviting them to take a survey. This is where many companies like to offer Amazon gift cards in exchange for your time. I recently got one who offered to donate $40 to the Amazon Rain Forest in my name. Excellent CSR!
Interviews
Interviewing the ideal customers you have identified is the best way to build a more detailed and accurate picture. Whenever possible, learn about their pain points, buying process, and decision-making factors.
If Even if you cannot convince them to buy right away, talking to your dream customers (that you haven’t signed) will be enlightening nonetheless.
Use an ideal customer profile template
Templates provide the simplest method for building an ICP. You can knock up something pretty quickly if the design team (or an intern with a Photoshop license) has some time to spare. Explore the related guides, B2B sales, SaaS sales and tech sales.
Conclusion
The best customers of any SaaS business are those who never stopped renewing their subscriptions. To make your customers stick, you and your sales team have to leave no stoned unturned in helping them fall in love with your product.
From the moment these customers were only new prospects, you should have thoughtfully mapped out a plan to help your sales team recognize and reach them. This plan is called the ideal customer profile. Having this handy will help you go after the right people and put them on the list of your best customers.