One challenge remains common for businesses of any size, sector, and location—building a successful sales strategy. If your sales team is struggling to connect with your customers, an ideal customer profile just might be the missing ingredient.
In this article, we’ll look at why having an ideal customer profile is crucial for businesses and how to build one for yours.
But first…
What is an ideal customer profile?
An ideal customer profile (ICP) is a template of companies likely to benefit the most from your product and, in turn, are also the most lucrative customer for your business.
A solid ICP is always backed up with accurate data and firmographics, such as:
- The company size
- Annual revenue
- Number of employees
- The industry company size
What’s the difference between ideal customer profiles and buyer personas?
While both ICPs and buyer personas help you understand your customers better, they are like different arrows in the sales teams’ arsenals.
An ideal customer profile for B2B businesses describes an imaginary company that would benefit the most from your product or service.
B2B buyer personas, on the other hand, are fictitious characters who represent the type of people who work at those targeted companies.
With that said, let’s talk about what makes ICPs so important for B2B businesses.
4 benefits of creating an ideal customer profile
In today’s post-pandemic era, sales teams need to adapt their strategies significantly. For example, the very first step of the sales outreach strategy at Spotted Media—which helped them gain their first set of customers before the website was ready—is to create an ideal customer profile.
ICP isn’t just a valuable tool for sales teams; it also provides your product team with useful insights to continuously test new and existing features.
On top of that, ideal customer profiles help you…
1. Speed up the sales cycle
The average sales cycle increased in length by 24% between 2022 and 2023. 60-day cycles are now 75-day cycles. This indicates that sales teams are struggling with finding quality leads and reducing the sales cycle.
Creating an ideal customer profile can address this challenge. This is especially true today, where buying habits evolve quickly, and customers make impulsive, faster buying decisions.
2. Personalize marketing
McKinsey found that the fastest-growing companies drive 40% more revenue by using personalization. With an ICP, you can create relatable campaigns and connect with your customers based on their segments, characteristics, and key behaviors.
3. Increase customer lifetime value (CLV)
Guido Bartolacci from New Breed explains how changing their ideal customer profile increased its deal size by 83% in just one year! Do you know what an increased deal size means? Yup… a higher lifetime value.
4. Help with Account-Based Marketing
94% of B2B marketers use Account-Based Marketing (ABM). And almost half of the survey respondents consider delivering a personalized customer experience to be their biggest challenge with ABM.
Based on this insight, many companies are now making ICP an integral part of their business strategy. Tracy Eiler, the CMO at InsideView, shares, “An important part of our strategy was building our ideal customer profile (ICP). These aren’t always the accounts you can sign the fastest—they’re the accounts most likely to stay with you the longest.”
It’s much easier to deliver a tailored experience to customers and clients when you know exactly what their pain points, challenges, and goals are.
Ebook
Ideal Customer Profile (ICP) Worksheet
Learn how to create an Ideal Customer Profile and build a successful sales strategy with this Ideal Customer Profile (ICP) Worksheet.
How to create an ideal customer profile in 7 steps
You should ultimately have your ideal customer profiles solidified before you start prospecting and qualifying leads.
This is because ICPs weed out irrelevant leads and help the sales personnel to focus on better prospects—this leads to fewer dead ends, increased uptake in your offers, and a shorter sales cycle because you’re targeting people who are a good fit.
Building an ICP isn’t a complex process. The following seven steps will help you build an ICP tailored to your company.
- List down your best customers
- Analyze your customers
- Compile a list of the notable attributes
- Identify your customer’s challenges
- Mention your unique value proposition
- Document your ICP
- Review and revise
Before you start
Your contact database will provide the foundations of your ICPs. But before you go ahead and take the data you already have as gospel, it’s important to check that it’s actually going to be useful. Duplicate information, outdated data, and downright wrong details won’t help you create accurate ICPs.
We all know that data is fundamental in today’s world, but you need it to be as clean and as accurate as possible. Building your ICP based on bad data can result in targeting the wrong leads and losing out on money.
This is where Breadcrumbs Reveal comes into play. In just a few steps, you’ll have a complete view of your database health and what attributes and actions are the best revenue predictors.
To get started:
- Connect your data. Connect your lead and customer data with no-code connectors to popular tools such as HubSpot, Marketo, Salesforce, Mixpanel, Intercom, and more.
- Define Your Objective. Let us know what segment of contacts we should use to define success. i.e., all paying customers or paying customers on specific plans.
- Get Your Results. See which attributes are the best predictors of revenue today, while machine learning gets smarter over time as more data is introduced.
1. List down your best customers
Your ICPs are a reflection of your best customers. Start by compiling a list of your current top customers that match the kind of companies you want to reach in the future. This could be based on how much they spend with you, how long they’ve been a customer, or what tiered subscription they use.
What constitutes a “best customer” depends on your business goals.
Here’s some inspiration:
- Largest accounts or your most profitable deals
- Customers with the highest satisfaction levels
- Customers you’ve successfully upsold/cross-sold to
- Customers with most contract renewals
- Customers who’ve referred you to others the most
- Customers who’ve stayed with you the longest
It’s best if this information is data-backed from relevant sources. A few examples of such sources are:
- Insights from customer-facing employees, in-field sales team members, and other key decision-makers such as sales or marketing heads
- Data provided by your CRM system and customer support logs
- Industry-related reports that provide relevant benchmarks
- A tool like Breadcrumbs Reveal
2. Analyze your customers
Once you have your list of customers, you can figure out the ‘why’ and the ‘what’:
- Why are they your ideal customers?
- Why have they stayed with you for so long?
- What made them buy your product/service?
These questions will help you understand what drives your ideal customers to purchase, their key pain points, and their main use cases for your product. All of this information will help you identify similar traits and characteristics in future customers.
So how can you find these answers? Here are a few ways to go about it.
- Conduct interviews: Connect with your customers directly to get detailed answers to all the “why’s.” While face-to-face interviews are ideal, video or telephonic interviews are a good alternative.
- Collect customer feedback: Over 90% of companies use customer feedback via surveys.
- Speak to customer service: Review any support tickets or sales calls with these customers to pinpoint the purchasing motivation.
Gather customer feedback through online surveys or feedback forms, like SurveyMonkey or Google Forms.
- Analyze indirect insights: Collect data from web analytics and social media to find potential customers similar to your current buyers.
- Use Breadcrumbs Reveal: connect your data to Breadcrumbs Reveal to analyze your marketing, sales, and product data and surface what makes a great customer to your business.
3. Compile a list of the notable attributes
You should now have a good picture of your current best customers and what your ideal customer profile should look like. Your next step is to document their 5-10 main attributes, like:
- Organization revenue and size
- Industry
- Location
- Department
- Growth rate
- Technology
Add your findings to a template, and you’re good to go.
Protip: Identifying attributes can be a boring and time-consuming exercise, not to mention prone to human error if you have lots of data. We may be biased, but why not let AI-driven ICP analysis tools like Breadcrumbs Reveal do the heavy lifting?
Setup will take you a few minutes, and Reveal will analyze your data and tell you which attributes in your current customers are the best indicators of revenue.
Creating a basic ICP template with just the above three steps is possible. However, we suggest uncovering more insights by following the next three steps.
4. Identify your customer’s challenges
Learning your customers’ behavior helps you discover new ways of serving them. Plus, it helps your sales team approach the right customer with targeted messaging.
This is exactly how Troops.ai increased its opportunity rate from less than 5% to 14%–it targeted the right people with specific messaging.
So how do you find your customer’s pain points, motivations, and expectations?
It’s simple—talk to them directly. Any customer retention strategy, like hosting a Zoom call or brand community, should do. Focus on getting qualitative data that digs deeper than the initial issue—you also want to find out why customers have those pain points, why they want to solve them, and what’s at risk if they don’t fix the issue.
Using Events for Reveal to identify customer behavior
Understanding the behaviors that drive purchasing decisions in your best customers is critical information if you want to be able to identify it in others.
Events for Reveal uses powerful technology to discover which customer actions predict a higher buying intent—for example, it might find that your best customers find you through a specific platform or they visit at least four pages on your website before they get in touch.
In just a few steps, Events for Reveal will highlight the events that happen most frequently among your best customers. This also helps you determine what activities have a direct, positive impact on your revenue so you can do more of them.
You can discover key behaviors and actions such as:
- What pages your best customers are most likely to visit
- Which lead magnets drive the best-quality conversions
- What actions are most likely to turn free trial users into a PQL
Use this information to enhance your ICPs and go beyond the simple demographic details like company size, job role, and location.
5. Mention your unique value proposition
Use this section in your ICP to outline your product or service’s unique selling proposition (USP). A USP differentiates your offering from your competitors and defines why customers should choose you.
A unique selling proposition also guides the efforts of your sales, marketing, and product teams:
- The sales team can focus on selling profile-specific features and benefits
- The marketing team can tailor the messaging to highlight the USP
- The product team can work on improving and differentiating your product from others
6. Document your ICP
Finally, all of your data and insights can come together and create an official ICP document.
So what does an ICP template look like? Let’s go through what we have seen so far. You should always include basic information about an ideal customer, such as:
- Firmographics (industry, geography, size, etc.)
- Behavioral insights (pain points, decision-making factors)
- Your core value proposition (why they should choose you)
Get started compiling your ICP by using the detailed Breadcrumbs ICP Worksheet–and remember to create forms to match each marketing segment you come up with. Pain points and value propositions may change depending on segments as well as how you market to each one of them.
7. Review and revise
Customer buying behavior doesn’t remain static, so your ideal customer profile shouldn’t either.
Every quarter, go through your ICP and update it with new information that’s come to light. Data-driven scoring like Breadcrumbs will help you update your ICP accurately.
Your brand new ideal customer profile is ready. Now what?
Now is the time to leverage your ideal customer profile and use it in ways that matter the most to your business.
This might be using the ICP as a benchmark for prospecting and scoring new leads. Or perhaps to discover new pain points. You may also want to use your ICP to reach new audiences with targeted and personalized ads.
How to use your ICP for better lead scoring
Events for Reveal will give you a complete 360-degree view of your best customers, including their most common behaviors and characteristics.
This information is incredibly useful for creating data-driven ICPs that aren’t based on guesswork. You can then use this to create effective lead-scoring models with Copilot that are laser-focused and based purely on cold, hard data.
Simply connect the customer data surfaced through Events for Reveal with your Copilot dashboard (or any other popular data-capturing tools you use) and let the tool know which customer segments should be used to define success—ideally, this will be the customers you’ve identified as your best customers based on their activity, behaviors, spend, and longevity with your company.
Then, Copilot will use powerful machine learning to analyze that data and build your lead scoring model. It will use the key behaviors and high-impact attributes of your best customers to generate scores you can use to streamline your sales process and make sure you’re reaching out to the most promising leads at all times.
If you’re ready to start creating ICPs you can use for enhanced lead scoring, download our Ideal Customer Profile worksheet.