How to Develop an Ideal Customer Profile

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Over the years, marketers have cited the 5x rule, which indicates it costs 5x more to create a new customer than to keep one. However, that statistic can be jarring when crafting a lead generation strategy. After all, why put in the effort to drive new leads if it is more cost-effective and delivers a higher ROI to focus on retaining current customers?

“FINDING IDEAL, BEST-FIT CUSTOMERS IS CRITICAL FOR DEVELOPING TARGET ACCOUNT LISTS AND DRIVING ENGAGEMENT AND PIPELINE.”

Forrester, Developing an Ideal Customer Profile, 2020

This blog post will focus on developing an Ideal Customer Profile (ICP) and Buyer Persona to align sales and marketing strategies to generate high-quality leads. Simultaneously, this exercise establishes a cross-functional playbook to identify current customers to retain and target for upsell potential. Ultimately, a clearly defined ICP and Buyer Persona enables go-to-market (GTM) alignment and adds to a business’s value and financial health.

WHAT IS AN IDEAL CUSTOMER PROFILE (ICP) AND BUYER PERSONA?

In its simplest form, the Ideal Customer Profile (ICP) outlines the type of company that will benefit most from your product or service and would make the ‘best’ customer to do business with. When designing an ICP, consider the following criteria:

Firmographics (What are the company characteristics?):

• Industry and verticals
• Annual Revenue
• Geography
• Employee Count
• Business Model, such as Business-to-Business (B2B), Business-to-Consumer (B2C), Business-to-Government (B2G),or Direct-to-Consumer (D2C)

Market Signals and Technographics (What signals this company is a good fit?)

• What is the advertising budget?
• How sophisticated is their technology?
• Are there barriers to implementing your solution?

Pain Points and Solutions

• What are the current and long-term pain points? 
• Do your products and services offer a viable solution? If so, provide details and how to integrate with the customers’ framework.
• How can your business help acquire new customers and increase leads?
• Will your product increase productivity or reduce advertising spend? 

A best practice is to analyze internal and external datasets, then use the data to facilitate an ideation meeting with your sales, marketing, client services, and technology teams to gather additional input. Engaging various stakeholders across your organization in ICP development will drive greater adoption beyond lead generation strategies by correlating customer data in the entire prospect buying journey. 

Remember, clarity is most important when developing your ideal customer profile. Providing a complicated set of attributes will only confuse internal stakeholders, adversely impacting brand positioning and stalling the launch of go-to-market initiatives. As a quick test, use the ‘elevator pitch’ to assess your ICP – in other words, ask your sales and marketing teams to describe your target audience in 30 seconds or less. If they falter, it might be time to create or refresh your ICP.

WHERE TO START

A good starting point is your current customer list. Begin by evaluating similar characteristics they share. Next and most important, assess your existing customers’ Lifetime Value (LTV) and future growth potential. Just because they are ‘good’ customers now doesn’t mean they are the right customers in the long term. A well-formulated ICP enables businesses to identify leads with higher Annual Contract Values (ACV) and Lifetime Values, providing a blueprint for segmenting target audiences and go-to-market (GTM) alignment.  

Next, take a close look at the individual buyers involved. The Buyer Persona is a fictional character of the type of person you want to target. In B2B marketing, this description includes their title (i.e., Demand Generation Director) and role influencing the decision-making process. For example, are they part of a larger buying committee, or is the ultimate decision more siloed? Other considerations to consider include the following:

• Examine the type of content that appeals to your Buyer Persona. For example, do they read blogs (like this one?) or case studies in industry newsletters or websites? Do they rely on brief posts and infographics on social media channels, such as Linkedin, Facebook, Twitter, or Instagram? And speaking of social, are they part of online communities or groups? 
• Research events they attend, either in person or online. Make a list of the most significant trade shows, professional associations, and industry conferences for each sector you are targeting.

HOW TO USE AN ICP AND BUYER PERSONA IN THE MARKETING STRATEGY

With an appropriately crafted ICP and Buyer Persona, you will have a starting point to design the right message, nurture leads, and implement targeting strategies. The additional time you put into this development process in the beginning will pay off in the long run with a customer-centric marketing focus.  

For example, let’s consider the content strategy targeting the Chief Marketing Officer (CMO) and Digital Marketing Manager at the same company. You may consider crafting different messages, as the CMO focuses on long-term resource planning while the manager works on short-term tactical operations. The data from your Buyer Persona development informs the messaging to different buyers. 

Additionally, this process helps build your lead scoring model, creating a better overall buying experience and fine-tuning your digital advertising to design highly-relevant ad formats to drive qualified leads to your website.

PARTNER WITH ADLUCENT TO DRIVE LEADS

With 20+ years of experience as a performance advertising innovator, Adlucent recognizes not all lead-driven businesses are the same, so we don’t use a ‘one size fits all’ approach. We partner with our customers to understand their ICP and Buyer Persona, hone in on their business goals, and ingest their data into our proprietary platform to continuously test and improve their search and social campaigns to drive highly qualified leads. 

Reach out today if you want to learn about partnering with Adlucent to bring more leads to your business.

Angela Schuster

Angela has years of experience as a user experience sculptor and marketing operations optimizer. She currently serves as Adlucent's Director of Marketing Operations and Strategic Alliances. Her work focuses on driving demand generation, market planning, and stakeholder alignment with various cross-functional teams. Angela volunteers extensively in her community and works as a social justice activist in her spare time.