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How to Create an Ideal Customer Profile in 2020

How to Create an Ideal Customer Profile in 2020

by Stephen Pina May 16, 2020
How to Create an Ideal Customer Profile in 2020

How to Create an Ideal Customer Profile in 2020

Imagine having to create ads without knowing who they’re for in 2020? In short, without knowing your Ideal Customer profile in 2020.

A marketing campaign without an Ideal Customer profile in 2020 is essentially just that. In other words, a shot in the dark. You can’t effectively target your ads if you don’t know who your audience is.

Deciding WHAT you’ll sell shouldn’t even be considered until you’re hyper clear on WHO you’ll serve.

But don’t worry, I’ve got your covered. In this post, I’m going to walk you through what an ICP is. I will also show you how to create your own (using this template).

While you’re following the steps, you’ll also learn different questions to ask along the way. Once you’ve defined who your ideal customer is, you’ll be able to use your ICP to laser-focus your business efforts to target these customers more effectively.

The results? More deals closed, more money made, and more growth accomplished.

What is an Ideal Customer profile in 2020?

An ICP is a combination of firmographic and behavioral characteristics that define an organization’s most valuable customers. By creating a general profile of an organization’s best accounts, sales and marketing teams can develop measurable strategies that convert these top buyers.

Company firmographics (the set of qualitative and quantitative characteristics of your best-fit accounts) define your Ideal Customer Profile. The company-level ICP is often confused with the buyer persona, which focuses on the qualities of the individual buyer.

What is a Buyer Persona?

A buyer persona is a semi-fictional, generalized representation of your customers that account for the demographics, goals, motivators, and challenges they are facing. Buyer personas provide structure and context for your organization. You can use buyer personas to help Marketing map out and curate content, and other teams—such as sales and support—with time and resource allocation.

Image by Robin Higgins from Pixabay

Both are important, and you’ll definitely want to develop and use both, but your ICP is actually what your user personas should be based on. ICP is the “type” of the client (or company), and user personas are examples of people that fall under that type.

For example, if you’re a SaaS company, your ideal customer might be businesses within the B2B tech industry. Your user personas will then be examples of specific employees you want to target among this group, like Bob, the VP of Sales, or Cynthia, the CMO.

If you’re an American clothing retailer, on the other hand, your ideal customer might be consumers within a specific age range living in the United States. Your user personas would narrow this down further, allowing you to target people like Paul the hipster.

Makes sense, right?

Buyer personas are based on market research and real data

Buyer personas are based on market research and real data about your existing customers. You have a lot of insight into your buyers internally as well. When looking to initially define your buyer personas, some people you can talk to:

  • Your customers: Your customer is defined as anyone that is already paying for your products or services. You have designated these customers to be a great fit can give you insight into what’s working. Pick up the phone, send a survey, or have them join you in your office for a focus group to identify some of their motivators, challenges they are facing day-to-day, and their favorite aspect of your product or service. Also, try talking to customers who aren’t a perfect fit, as they can help identify account characteristics your team shouldn’t be targeting and why.
  • Your customer-facing teams: interview the people internally that are on the phone or face-to-face every day with your customers and leads. Set up a focus group that combines members from different teams that could provide varying perspectives, having a sales rep and a customer success manager could provide diverse insight. What kinds of questions are they repeatedly answering? Are there common roadblocks they see hindering their customer’s experience?
  • Your CRM: use your contacts’ information to look for trends to understand better how your leads are accessing and consuming your content.

Hubspot has a free tool that allows you to create your buyer persona and looks cool.  Check it out and use the free tool.

Alignment with Sales and Marketing

Developing an ICP is a strategic exercise that must involve the alignment of sales, marketing, and leadership, as well as the development and agreement on the definition and parameters of the characteristics feeding into that definition.

Sales and marketing alignment is critical to business growth. For skeptics who think otherwise, consider the following: Companies whose sales and marketing teams work together see 36% higher customer retention and 38% higher sales win rates (source).

An ICP can inform your entire sales and marketing strategy, from content creation to advertising to sales outreach, by answering critical questions.

How do you Help sales and marketers

How do you Help sales and marketers understand what a good ICP can do for them:

  • What type of messaging resonates with your best customers? Increase effectiveness from focusing the efforts of your teams on repeatable and scalable strategies that reach and nurture the right prospects with the right message.
  • Better yet, what factors disqualify them from buying? Shorten sales cycles by reducing time in the awareness stage of the buyer’s journey. Qualified prospects may already be using your competitor or looking for services like yours.
  • How do you communicate your value proposition? Better fit prospects and opportunities won turn into better-fit customers who have a lower churn rate.
  • Increased closed-won deals – those entering the pipeline are more likely to have the budget, interest, and talent needed for your product to have value.

Sold yet? (How could you NOT be?) Now, let’s get into the “how you do it.” Keep reading to see how we define ICP and our best practices for creating Ideal Customer Profiles!

Why you need an Ideal Customer profile in 2020:

While ICPs are meant to serve as an overview of your ideal customers, don’t shy away from making yours as detailed as possible. The more detailed your ICP, the better you can identify and target your ideal customers.

Image by Free-Photos from Pixabay

Image by Free-Photos from Pixabay

Here are a few more benefits you can get from creating and using an ICP:

  • It’ll make you more money. Because you’ll know who you’re targeting, your marketing dollars will be allocated accordingly, so no dollar is wasted chasing the wrong leads. You’ll also rake in points that are more likely to become customers, increasing your win rate and helping you close more deals.
  • It’ll increase customer lifetime value. Knowing who you’re catering to your sales process will allow you to streamline your acquisition efforts and reduce customer churn.
  • It’ll get you more referrals. Building positive relationships with your customers has never been more critical than it is now. One of the reasons for that is when a customer is delighted with your brand, they’ll tell their friends about it—who just might fit your ICP as well.

How to create an Ideal Customer profile in 2020:

Step 1: Make a list of your “best” customers.

Take a look at your existing customer base. If you had to narrow down the list to 5-10 “best” customers, who would they be?

Pro-tip: If you’re just starting out and don’t have a whole lot of customers to work off of, think about the type of potential customers that would most benefit from your product. Who needs your product or service the most?  Use this detailed 40 Step process here

You should (hopefully) have a lot of customers who love your brand. You can narrow this down to around ten by looking at who’s getting the most value out of your product or service: value not only in terms of how you impact their bottom line directly (in the case of B2B companies) but indirectly as well, such as by alleviating pain points, increasing productivity, or otherwise helping them achieve their objectives.

In other words, how much does your product or service contribute to their overall success?

Narrow down your customers

Some questions to ask yourself to help you narrow down your customers are:

  • Which accounts are your most profitable?
  • Which accounts have been with you the longest?
  • Does the customer make significantly more money using your product than they spend on it? (Aka. return-on-investment or “ROI.”)

Step 2: List their attributes.

Looking at your list of “best” customers, next to each one, listing all the notable attributes about them.

For example:

  • Industry
  • Geography
  • Number of employees
  • Number of customers
  • Budget

As you’re writing these attributes out, you’ll notice you have more information about some than others, or that you’re missing some details that would be very helpful to include in your ICP such as budget or the number of customers they serve.

That’s where customer interviews come in, which we’ll go into next.

Step 3: Interview them.

Remember, these people love you!

So, they’ll probably be more than happy to agree to hop on a call.  On the call you can ask them a few questions about their experience with your brand or product.

Shoot them an email asking if they have time to chat.

For example:

Hey {First Name},

I hope you and the whole team at {Company Name} are doing well!

We just want to say we appreciate you being a long-time customer.  We would love to set up a few minutes to chat with you about your experience with {your product or service}. We’re always looking for ways to improve, so we want to hear what you like the most and where you think we can improve.

Let me know if one of the following times works for you:

  • Thursday, March 28 at 10:00 am PT
  • Friday, March 29 at 11:30 am PT

I am looking forward to getting your feedback!

Cheers,

{Your Name}

{Your Company Name}

The goal of this call will be for you to fill in any missing information.  The result will get a detailed account of their buying experience.  You can learn how they discovered you.  Why they decided to buy from you. Their experience with your product now.

examples of questions you can ask during this call

Here are some examples of questions you can ask during this call:

  • How did they hear about your company?
  • What was their buying process like?
  • Who was the decision-maker for this product?
  • What were their primary pain points they were trying to solve?
  • What are their objectives now?

Step 4: Compile data and fill in the ICP template.

Now that you’ve narrowed down your top customers listed all their attributes.  Also, list what makes them “the best” and interviewed them to get the full story.  Then compile and organize all your findings together into one universal document—this will be your ICP.

Finally, it’s time to fill out that ICP template we mentioned with the data you gathered.

Use your Ideal Customer profile in 2020 to create more targeted ads.

Having an ideal customer profile in place will benefit multiple departments within your company, helping them to help your customers.

Here are just a few ways you can use ICPs to improve your business operations:

  • The Product team will be able to ensure the features and functionality of their products accommodate these profiles.
  • The Marketing team will have a better idea of what kinds of ads to produce.  They will use language to evoke emotions that would cater to these profiles. The marketing team also be able to use them to develop user personas to target ads even better.
  • The Sales team will qualify leads more effectively with a more detailed description of best practices.  They also know how to prioritize them.

 

Want to connect with others that have the same mindset and share tips, tricks, and updates? Head over to our Facebook Group, Building Your Business With OBM to join a conversation or start one of your own by asking questions.

If you have any questions about digital marketing in general and want to learn more check out this article What is Digital Marketing in 2020.

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Stephen Pina

CEO of OutBound Marketers, who has worked over 15 years in the federal government in various leadership roles and has been successful in optimizing and growing the departments he was responsible for. Stephen realized that what he had best learned was how to market himself and his team which leads him to throw himself into the digital marketing world. He brings his high level of work ethic and dedication to his trade as he did while in the military and federal service. He is a known team builder and works tirelessly to help build up those who partner with him.

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