Do you want to win more high-value deals and waste less of your marketing budget? Then you should start with a detailed analysis of your ideal customers.
This article will cover a simple process for how to create an ideal customer profile (ICP) that will help you create more targeted ads, get more engagement on your content, and get a better response on your sales outreach.
You will learn:
- What is an ICP and why do you need one?
- How to identify target accounts by common attributes
- How to identify the buying committee in your target accounts
- Where and how to build your lists and import it to your CRM
- How to formalise your ICP by uploading it to your CRM
What is an ICP and why do you need one?
An ICP is a detailed description of the companies you want to target, and which gives you a better understanding of the types of accounts and people you should focus on.
ICP is mostly used in conjunction with account-based marketing. ABM is a strategy which is best suited for sales-led companies selling complex B2B products with multiple decision-makers and influencers in verticals such as:
- Cyber Security
- Industrial IoT (IIoT)
- Robotic Process Automation (RPA)
- Enterprise SaaS
The companies within your ICP share many common characteristics, they share a pain your product can solve, and they have the budget to solve that pain.
Defining your ICP will make it easy to build a list of companies and stakeholders within those accounts you want to close as new customers that will make it easier to:
- Make your sales outreach more personalised, relevant, and engaging
- Execute more targeted and relevant advertising campaigns
- Create more insightful content for the people that actually matter
The end results is a customer acquisition strategy that is less wasteful of your budget, more relevant to your audience.
But how do you create an ICP yourself?
Step 1: Identify common attributes
The first step in an account-based marketing strategy is to identify the types of organisations you sell to and find common attributes among them.
The easiest way is generally to look at your best customers or your competitors customers and get an understanding of their shared attributes.
A good target account can be defined by multiple attributes such as:
- Revenue and size - Are you going after startups, scale-ups or enterprise level customers with huge budgets? What level of revenue do they need to be at to be qualified to buy your product? Bigger companies usually means more stakeholders and longer sales cycles.
- Industry or specialisation - By personalising your message to a specific audience will make your content, ads, and sales outreach easier.
- Regions and countries - Are there any specific countries you want to focus on? For example, there can be a big difference between how you market your product Northern Europe vs. the United States that you need to account for.
- Department - Are you going after a specific department in a bigger organisation? IS the decision-making centralised or decentralised?
- Growth rate - How fast are they growing? Are they expanding to multiple locations or hiring a lot of new employees? What are the minimum and maximum number of employees?
- Technology - What types of technology are they currently using? Are they using a competitor to your product? Is there a switching cost?
After defining the type of companies you want to target, you now need to identify the individuals within those accounts that you need to market to.
Step 2: Identify the decision making unit (DMU)
An ICP is not the same as a buyer persona. Your ICP is not a single person, but a profile of companies you want to influence and close as a customer.
A persona can be an individual within a target account that is created based on a person's job title or function. While buyer personas can be helpful in some scenarios, I think that B2B marketers rely on them too much.
Personas take a lot of time to create and are often built based on many inaccurate assumptions about the buyer. This leads to formulaic and generic marketing that lacks any insight, and that does not help you influence their buying process.
The end result of creating personas is more than often an overcomplicated and irrelevant profile of a B2B buyer that does not exist in the real world.
In other words; creating personas is often a wasted exercise.
If the persona takes someone several weeks or months to build, you are wasting time you could have spent more productively on other strategies and tactics.
You do not need to name your personas or describe every minute detail you assume about your prospective customers. This information rarely translates into any useful information for marketers or salespeople.
Companies that spend months creating multiple personas are unnecessarily going into the weeds instead of putting in the time to do actual marketing.
The traditional approach to creating personas also ignores the fact that you are dealing with more than one person in the buying process.
In B2B, you will generally deal with a buying committee (also called a decision-making unit or DMU) with multiple decision-makers, influencers, budget-holders etc.
In an ideal situation you want to talk to the decision maker, but there are many other people who can either prevent or facilitate the sales process as well.
To identify the DMU, you should ask the following questions:
- Job title: What are the typical titles of the decision makers, budget holders, champions, blockers, and end users in your target accounts?
- Function: What functions does each contact manage in their company?
- KPIs: What metrics and outcomes are each person wanting to achieve?
- Value proposition: How can you translate this person's business needs, problem, challenges, and goals into a succinct and clear value proposition that makes you stand out?
- Role in the buying process: What is their role in the buying process? Are they a decision maker, budget holder, blocker, champion, or end user?
- Technology stack: What technologies do potential customers typically use?
- Publications: What websites or trade magazines do potential customers read?
- Newsletters: What newsletters do they subscribe to?
- Communities: What are common online groups these buyers frequent often? Can be Facebook or LinkedIn groups, forums, Quora etc.
- Events: What events do they attend?
The information you gather about your DMU gives you a great foundation that makes the rest of your sales and marketing activities more effective:
- Each outreach attempt from a salesperson can be more personalised to each role by using different KPIs, value propositions, or content assets.
- Your ads will be more targeted, resulting in higher engagement and click-through
- Your content will be consumed by the people that matters most to your business, and who are familiar with the problem you are solving
Step 3: Build your lists and import it to your CRM
The third step is to build a complete list of target accounts that you can import into your CRM and marketing automation system.
This part of the process should start with looking at your existing contacts and use the properties in your ICP to filter out companies that are already in your database.
Ask yourself who their competitors are, and what companies your competitors work with. This gives you a good starting point for expanding your account list.
This can be a very tedious process when done manually, but luckily there are multiple solutions available that helps you build your target account lists quickly such as:
- D&B Hoovers
- Vainu Company Search
- LinkedIn Sales Navigator
Most of these tools listed will let you export their data into a spreadsheet that contains industry, location, revenue, technology stack, number of employees etc.
It is important to add that you are responsible for ensuring that your list you are collecting is targeted, appropriate, necessary, and relevant.
You should not buy lists just to send bulk emails. The purpose of creating a list is simply to identify which companies that can benefit from your product.
You can safely reach out to a company of give the prospect a good reason for why you are contacting them, and that you make it easy for the recipient to opt out.
Back to importing the data to your CRM:
The next step is to tier your accounts into one of three tiers:
- Tier 1 accounts are perfect ICP fits, similar to your highest value customers. Tier 1 also includes logos with high strategic value. Usually there are between 5 and 50 accounts. Going after these accounts require deep research and targeting for months or years, and full support from marketing, sales, and management.
- Tier 2 accounts are strong ICP fits with a lower lifetime value. Usually there are between 20 and 100 named accounts. Personalisation is on an industry or vertical level and targeting lasts multiple weeks or months.
- Tier 3 accounts fit most ICP criteria. They’re worth pursuing but typically not worth investing significant resources to win their business. Usually there are between 100 and 1000 accounts in this tier.
Companies often want to go after more accounts than they can realistically handle, but tiering forces you to prioritise which accounts to focus on at any given time.
You can do some initial tiering when importing your companies and contacts, but this list will change over time as companies will be "promoted" or "demoted"
An ideal customer should have a need, have intent to take action, and have the budget to do so. With tiering, you can promote or demote companies not only based on fit and LTV, but based on timing and need as well.
Step 4: Upload the data to your CRM and tier accounts
The last step is to formalise your ICP by importing your data into a CRM system. We usually recommend using HubSpot to set up and implement an account-based marketing strategy as it is a great tool to centralise all the information you have about an account.
HubSpot lets you set up custom properties and segment contacts into their buying role. Since sales, marketing, and customer support all have access to the same CRM, HubSpot ensures that no information is lost when handing an opportunity over to sales.
In HubSpot, sales and marketing have a shared target account overview that gives both teams insights into the progress of each account.
This helps you to track and measure each step in every account’s journey and get a more detailed understanding of what is happening at an account level.
This helps you to prioritise active over passive buyers. In addition to tiers, HubSpot will give you insight into which accounts have buying intent.
Not every account will be ready to buy even if your product solves a pain the people in the target account have. You will still need to do a lot of education before most of them are even ready to talk to you.
To start building awareness within your accounts and get engagement from them, you need to promote relevant content and product information to each person within your target accounts.
By uploading your ICP data to a CRM, you can create lists that can be synced with advertising platforms such as Facebook, LinkedIn, and Google that makes it easy to get the right content in front of your target audience.
HubSpot also offers ABM dashboards and reports that help you report on KPIs such as the number of page views from each account, which channels are creating the most target accounts, and deal stage by target account that shows the number of accounts in your pipeline.
You cannot argue with the premise of account-based marketing and using an ICP to get more specific in your targeting and messaging. By investing the time to really understand your ideal customers, you will make it easier down the road to sell to them, and close higher-value deals faster.