Why Your Business Needs To Define Its Ideal Customer Profile
Not everyone is your customer. It can be tempting as a new venture to cast your net as wide as possible when it comes to acquiring customers.
I once had a business leader of a startup say to me – “everyone who should know about us, already does.” If that were indeed the case, how valuable of a market is that company positioned to serve?
Well, for giant, well-established companies with high brand awareness like McDonald's, Amazon, and AT&T, the statement might indeed be true. But for the average small enterprise, clearly focusing your story and resources on the customer you are best equipped to serve is paramount.
This is why I recommend that one of your first marketing activities is to define your Ideal Customer Profile (ICP), and then to build a marketing strategy designed to create awareness and consideration for companies that meet the criteria for your ICP.
To start, here are a few key elements of the Ideal Customer Profile for the B2B organization:
1. What needs and wants does your prospective customer have?
For example, the Ideal Customer may need to automate the production, deployment, and tracking of marketing activities in order to execute its marketing plan and to provide real-time reporting to decision-makers. Further, the company may want to build stronger communication and alignment across the organization through consistent marketing reporting.
2. What pain points typically exist for that customer?
The marketing team for the Ideal Customer may be spending too much time on redundant tasks, balancing between spreadsheets and presentations that must be manually created, maintained, and distributed.
3. What operational or legal considerations must be in place?
The Ideal Customer must sell products only in the U.S. due to legal or regulatory considerations, and must employ at least 50 people.
4. What financial conditions must be in place?
The Ideal Customer must have revenue of $5 million or higher.
5. How often does the customer typically buy your category of product or service?
The Ideal Customer must plan to buy or upgrade its marketing automation platform around every 24 months.
There are Ideal Customer Profile templates readily available, you can download the one Ladder 17 has created here. You will want to note that understanding the key dimensions of your Ideal Customer will be an iterative process. I suggest using a test and learn mindset to hone your ICP over time.
In my next blog post, I will dive into how to develop the Buyer Persona, which is a great tool for both B2B and B2C companies.
