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What is ICP (Ideal customer profile)?

According to Wikipedia, a marketing strategy is a long-term, forward-looking approach to planning. The fundamental goal here is achieving a sustainable competitive advantage. Any smart B2B business owner knows that investing in a marketing strategy is crucial. This investment helps in reaching organizational goals in an efficient, time-bound manner. All this is without wasting any resources in areas with low or no returns.
 
You’ve heard it before and we’re saying it again – ‘Sales and Marketing alignment is integral to business growth.’
According to HubSpot, the statistics point to this phenomenon. Companies, where the sales and marketing teams aligned operation, experienced positive results. They saw 36% higher customer retention rates and 38% higher sales win rates.
 
However, only having a marketing strategy in place won’t cut it for B2B marketers anymore. Over 6200 B2B marketers say that their biggest business challenges include generation of leads and traffic. They express difficulty in measuring the ROI of marketing activities.

 

What is a Solid Marketing Strategy for a B2B Business?

A marketing strategy that helps your organization achieve its marketing goals is solid. Every B2B business is unique in all aspects of its functioning. Consequently, there is no ‘one size fits all’ approach to B2B marketing strategy. However, all marketing efforts begin with first understanding who your customer is. When you’ve made this clear, you can focus on crafting the right communication for your customer.

 

Market Segmentation Will Get You Started

Imagine you could choose between two different CRMs to focus your marketing communication.
 
The first CRM is generic and can only keep track of sales. The second CRM offers you segmentation. This segmentation is based on factors like average purchase price per customer and retention rate. It tracks the frequency of purchase, the industry they belong to, seniority of position and so on.
 
If you’re a smart marketer, you will choose the second option.
 
Marketing segmentation means dividing your potential or existing customers into sub-groups. You divide them into groups (segments) by a common characteristic. Characteristics based on age, organization size, budget or any other factor help. When you segment your market, you are focusing clearly. You take steps to assure that your marketing efforts gear to a particular group of individuals. Your team targets individuals who are highly likely to respond. Segmentation gives you an understanding about people. It tells you which groups of people are most likely to respond to a specific marketing action.

 

Marketing Segmentation and ROI

Marketing segmentation is a short-cut to increased ROIs, higher conversion rates and revenue generation. However, analyzing these segments is essential to accurately predict the ROIs you are likely to get from these segments. Such analyses are different for every individual B2B business. However, some common factors will get you started. Consider including market breadth, competition analyses, lifetime value, retention rates, solvency and the ease of getting past gatekeepers for each segment.

Once you have conducted such research about the various segments applicable to your B2B business, you’re going to realize two main things –

  • Every market segment is different. There may be some segments that generate a high ROI but require more resources. On the contrary, some other segments may require less investment, but you can expect high revenue generation.
  • All market segments are unique and have different needs. For this reason, you need a different approach and proposal for communicating with prospects from different market segments.

 

What are Ideal Customer Profiles (ICP) Exactly?

An ICP is not just a simple customer profile. In the case of customer profiling, the organization tries to essentially build a blueprint. Such a map of the average customer evaluates who is likely to avail the products and services the organization offers. However, many companies try to build a single average profile based on all the data they have.

Instead, when you focus on the research you’ve gathered based on market segments, creating ideal customer profiles is a more extensive task. Don’t just focus on a universal sales pitch to cater to the entire market. Work on creating lead generation marketing campaigns suited to each segment. Basically, through ICP, you focus on attracting high-quality leads. Such leads might respond to your marketing efforts in the desired manner. This is better as opposed to simply prospecting everyone you can lay your hands on.
 

What Can ICPs Offer You?

ICPs can give you insights that’ll help you understand who to say ‘yes’ to and who to say ‘no’ to. If you’re still in the start-up phase of the business, you’re probably not in a position to turn down any offers. But once you have a bigger organization to consider, saying ‘no’.  Denying prospects who may be a poor fit for your B2B organization will save you resources, time and money in the long run.
 
The marketing team of a B2B organization uses ICP for targeting and messaging. Usually, the sales team uses the ICP to navigate through pain points and probable objections that may arise in the purchase process. Your target market is more likely to accept new products and product development built around ICP.

 

How to create the Ideal Customer Profile for Your B2B Business

An ideal ICP comes from a mix of a qualitative and quantitative analysis of your database. Here, you can be as general or specific as your B2B business needs. Understand that your ICP is going to be the guiding light of your lead generation endeavors. Accordingly, you need to make sure that the data you access and employ is relevant, up-to-date, complete and useful. To ensure that this is the case, we recommend manual data cleaning services every six months. This makes sure that you as a marketer have your finger on the pulse of the ever-changing market you do business in.

To create the ICP for your B2B business, consider the following steps –

Step 1 – Define Yourself

Unless you know exactly what you can offer your B2B customers, you won’t be in a position to define your ICP. To start with, analyze your organization’s strengths and weaknesses in a very honest and open manner. Review the systems and practices you employ in your day-to-day activities to understand and guide your overall sales and marketing operations. This analysis will also help you understand which unexplored markets might have potential buyers and what changes you can make to better align yourself with the market’s needs.

Step 2- Define the Buyers

Knowing your buyer is not only limited to the basics like industry, turnover and demand analysis.  In this step, you must analyze how you as an organization align with your target buyers. By defining and documenting the criteria you use to judge your market, defining your ICP is easier. Understand what sizes of organizations are best suited to do business with. Perhaps you need to analyze which industry verticals you are most successful with. Look for cases where your buyers respond in the most desired manner. Depending on what perspective you choose for your B2B organization, define your buyers comprehensively to understand what you can offer them.

Step 3 – Identify The Best

The next step involves recognizing your ‘best’ customers. Since this is a fairly abstract term, feel free to go ahead with who your business considers the best customers. Obviously, the customers who offer you the most sales and revenue should be on the list. But don’t forget the ones who are the most pleasant to do business with and those who promote your business in their network the most.

Step 4 – Identify the Worst

In this step, you’re essentially reversing the previous step and looking out for the ‘worst’ customers. Again, don’t be limited to businesses that bring in the lowest sales and revenue. Also consider the customers who are likely to rate you negatively, are unpleasant and won’t promote your services.

Here are a few other criteria to keep in mind while segregating your ‘best’ and ‘worst’ customers:

Customer Lifetime Value

The CLV refers to the profits your company will earn from a customer, over the course of their relationship with your organization. This helps in determining how much to spend on customer acquisition.

Referrals

Highly satisfied customers are known to promote your services within their own network. This helps you garner more business in the long run. Statistics show that up to 84% of B2B business transactions begin the purchase cycle through a referral. Ask any marketer and they’ll attest to the faster pace of closing sales that come via referrals.

Product Usage Frequency

The more frequently a product or service is used by a customer organization, the more likely you are to get reselling or maintenance opportunities. Identify how marketable a particular feature of your product or service is. Guage how frequently you can offer your assistance.

Customer Advocacy

As mentioned before, you must learn who is rooting for you. Check which of your customer companies are most willing to publically endorse, advocate and refer your brand, product or service. This is an integral part of bringing in more leads. So, you can probably have specific marketing efforts geared toward gaining stronger customer advocacy. Think of who is most willing to share what you produce. Think of who shares statistics, participates in surveys, answers feedback, offers constructive criticism, and publishes online reviews. Give them as much importance as you would give people who brought in more leads via personal recommendations.

Established Brands

Being in business with a brand that is already established is the best. A well-known and influential company boosts your B2B organization’s brand value in the market.

Step 5 – Create Customer Profiles

After you’ve identified who your ‘best’ and ‘worst’ customers are, the next step is to create a profile for each of them with important information. Essentially, you’re trying to create a database of your clients so that it is easier to find patterns and trends. While making these customer profiles, here are key factors to include –

  • Annual Company Revenue
  • Number of Employees
  • SIC (Standard Industrial Classification) code
  • NAICS (North American Industrial Classification) code
  • Scope of organization on a local, regional, national and international level
  • Type of organization – start-up, mid-size, large organization etc.

Step 6 – Understand How They Became Your Customer

It goes without saying that your prospects and leads come from a multitude of sources and marketing channels. However, understanding which channels bring in the best customers will help you concentrate your marketing efforts in the right place. By understanding your customers, you will know where to put your golden efforts.

 

The Benefits of ICP

In case of any B2B marketing strategy, the organization is looking for maximum ROIs. Here, the aim is to have efficient, relevant and personalized communication across channels. With ICP you get a step closer to crafting measurable strategies. However, there are a host of other benefits –

Personalization

 It has been observed that as smartphones become an integral part of the B2B sector, customers’ expectations from marketing communication have increased. The customer today demands an experience that is personalized. If your B2B marketing strategy does not account for this, you’re likely to lose the customer’s interest. By employing ICP into your B2B marketing strategy, you can seamlessly personalize marketing materials and communications including sales pages, landing pages, offers, proposals, email marketing campaigns and so on.

Lead Generation

 It goes without saying that the quality of your leads can make or break your business. With ICP, you’ll be better aware of what works for your B2B business. Instead of guessing what works or simply following what is preached as popular, you’ll be able to figure out which channels of lead generation work best. In the long run, your marketing efforts will see more positive outcomes.

Efficient Marketing

With ICP, you can easily track trends within your customer group. When you know what your customer responds to best based on a particular segment, you’ll know which marketing strategies will work to target customers within a segment. Essentially, you can pick and choose the manner of communicating with each segment to select a marketing channel that appeals to a particular segment. This ensures that your objectives are met and your marketing strategy is effective.

Optimizing Inbound Leads

 An ICP acts as your blueprint into the right customer’s mind. You’ll be able to qualify an inbound lead into a particular segment based on similar traits. This helps you deliver to them the products, services, experiences and other communication they would best respond to. You’re no longer going to have to fumble around in the dark. There is no need to rely on generic market trends to decide what to offer an inbound lead.  

Streamlining Communications

 With a well-defined ICP at your disposal, all sales and marketing strategies can be streamlined to bring maximum output from each marketing channel. You can streamline communications in all areas. Areas including content creation, advertising, lead generation, and sales outreach efforts promise maximum returns with a reasonable amount of effort.

 

Conclusion – The Bottom Line

Your B2B business is going benefit tremendously from the generation of ICPs for your organization. However, it is necessary to supplement this with quality service. You must provide exceptional customer service and offer quality products and services. Work with upgraded marketing strategies, and have stellar lead generation tactics.

In order to make the most of your customer database for an accurate ICP generation, your database must be completely up-to-date, relevant and appended. Sadly, your marketing team can’t handle this task. It is not possible to saddle your sales and marketing team with the added responsibility of data upkeep. Doing this without seriously affecting their productivity is almost impossible. Additionally, they aren’t especially qualified to undertake this task.

In such a scenario, your best bet is opting for manual data cleaning services. You will benefit from an industry leader like BizProspex. With 6+ years of experience and a team of professional executives, we are the right data cleaning, appending and enrichment partner for your B2B business’s data needs.

Leads Research for B2B is like oil for automobiles, we offer bespoke services to help you get the most out of your lead generation efforts.

 

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