Consumer behaviour and sentiments vary across geographies, depending on the local customs and cultures. They also vary based on industry, depending on the mood of the market. But never before has consumer behavior and sentiment changed so drastically. In a fast-transforming business landscape defined by lockdowns and physical distancing, where customer sentiments and behaviors seemingly change faster than COVID-19 virus mutations, it is important for businesses to rely on direct sales to drive revenue and systematically update their customer profiles to adapt to the next normal. This starts with understanding what is an ideal customer profile, or ICP, and ways to identify them.
“All too often, marketers and salespeople think ‘a customer is a customer and any sale is a good sale'. It’s time to break free from that mindset. In reality, there is a stark difference between an ideal customer and less-than-ideal customers,” says Vendasta Chief Customer Officer George Leith. When you try to serve everyone, you end up serving no one. There is a unique group of people out there (you should target), clients who desperately need what you have to offer. By chasing people who are not your ideal customer profile, you set yourself up for reputation damage because one can’t be good at managing every kind of customer profile.
But what is an ideal customer profile? How do you identify an ICP? And how do you make a suitable pitch to them? Here are six steps to finding your ICP.
1. ICP is not the buyer persona
Many confuse ICP with a buyer persona. They aren’t the same. “Ideal customer profile is the customer that you do a really good job at serving. But inside every ideal customer profile are numerous personas that you need to understand — the people that make the buying decision inside that ideal customer profile,” Leith says.
Simply put, ICP is the well-thought-out, detailed description of the type of company — not the individual buyer or end user — who will benefit most from your products or services. On the other hand, buyer persona is a detailed analysis of the individual buyer who buys from you. There could be different buyer personas within your target customer company with different buying patterns. Therefore, your ICP should focus on relevant characteristics of your target accounts — be it vertical or domain, number of people and departments in that company, the geographies they serve, or the kind of customers they serve.
2. The good old brainstorming
Once you understand the basic definition, the most important step is to figure out who you should serve. “And this needs some old-fashioned brainstorming. Begin with brainstorming the problems of your ideal customer,” Leith says.
You could begin by asking yourself, what specific problem am I trying to solve for this customer. And then ask if you really have the expertise in that sphere.
The next step is reverse engineering — identifying your success areas, and then looking for other customers who may similarly fit the customer profile in that area. Once you figure that out, you want to consider things like their gender, age, interests, hobbies, occupation, location, relevant behaviors, and much more.
“The research that goes into forming an ideal customer profile should be extensive. There’s no cutting corners. It’s finding out where they are, what industry they’re in, how many employees they have, who their competitors are, and who the decision-makers are within the company. Missing just one critical part of the ICP could mean wasting thousands of dollars (or more) targeting potential customers who will never convert—not even with the most effective content marketing strategy in the world,” writes ABM Agency President Vincent DeCastro.
3. Surveying existing clients
Survey existing customers or clients as a way to find out who they are. Ask questions about their client base, the key issues and problems they face, so you can better define your value proposition.
“Ask simple questions like, why do you work with us; what do you like; what do you not like; and what could we do better,” Leith says.
While surveying an existing customer base, it’s also important to not get lulled into complacency with the existing data in hand or a perceived existing understanding of customer needs. It’s important to regularly meet and interact with customers and seek feedback to get a clear picture of what they care about. Encourage your sales team to have regular customer interviews, if possible, in person. In addition to collecting valuable feedback first-hand, this also encourages the team to build human relationships with people who matter in those companies.
4. Dig into Google Analytics
Your website analytics provide a wealth of valuable information to help you pinpoint your target audience. It’s the number one way to figure out exactly who you serve.
By using Google Analytics, we can figure out the metrics to dig into, and from there learn who has purchased in the past. And then reverse engineer how they came to us. That’s how we can figure out what the buyer’s journey is for the ideal customer profile.
5. Analyze Social Media
Then there’s social listening. Most major social networking sites provide a way to analyze audience interactions. There are built-in analytics tools such as Facebook Page Insights, Twitter Analytics, and Instagram Insights, among others. LinkedIn has a form tool inside its platform that captures a lead right inside LinkedIn.
Once again, ask questions like:
- Which of your content formats get the most reach and engagement — text, images, videos or blogs?
- What are the most popular topics consumed?
- What are the most popular networks?
You also need to determine the social media network where your ICP lives and finds value in. Then try to understand more about the audience.
- Who are they?
- What are they like?
- Where do they spend their time?
In today’s digital age, these are complex questions, where it’s not just the local newspaper or the TV/radio station that they depend on for answers. The probable customer could be anywhere on the World Wide Web. You need to identify the audience as well as the platforms to put relevant messages in front of more people who look like the ideal customer profile.
Social media analytics provide an understanding of how they are reacting to our products and solutions, or even how competitors solve some of the problems of the ideal customer profiles. Social media is also great for identifying a new ICP.
6. Spy on your competitors
The next step is spying on competitors. One needs to actually deploy all four tactics mentioned above to supplement the information gleaned to develop a file on competitors.
One of the best ways to learn about your competitors is to look at their lead magnets, the freebies that they offer, the mouse traps that are out there, buyers they’re trying to attract. All these things shed light on their target audience, and how you need to adapt to get more of your ideal customer profile from competitors.
ICP in a next normal world
The phrase “the new normal” is passé. In a world crippled by the pandemic for beyond a year now, the more accurate words might be “the next normal.” As businesses continually transform to the next normal, the ideal customer profile will swiftly change.
To stay afloat in this new business environment, companies must put sales at the center of their business strategy. On their part, sales professionals need to overhaul their age-old functioning and thinking. They must also adopt tools and technologies to quickly skim through data to clearly and accurately identify the ideal customer profile, and effectively pitch to them so that they choose you over your competition. The pandemic has drastically shrunk the business space — both in terms of fewer businesses and fewer opportunities.
“Yet, this presents an opportunity to rethink not only what you sell, but how you sell it as a means to increase revenue, margin, or market share,” says Scott Edinger, founder of Edinger Consulting, author and a thought leader.
Having a clear idea of the customer profile helps businesses build more customized products and solutions, focus on a more relevant customer base, and develop stronger relationships with existing customers.