Creating an ideal customer profile (ICP) is an essential step in your B2B marketing strategy, especially if you are targeting high-value customers using Account-Based Marketing (ABM). When you target the right customer with the right content at the right time, that’s when the magic happens.
But are you doing it right? If you get it wrong, you’re wasting a lot of time and money and inhibiting your revenue growth. So, how do you do it the right way? It’s time to rethink the way you develop your ICPs by leveraging data and research.
Rethink How You Develop The Ideal Customer Profile
Even some experienced B2B marketers confuse ideal customer profiles with buyer personas. They think of ICPs as a hypothetical description of the perfect customer.
Stop.
An ICP is not a hypothetical, but an educated and well-informed description of perfect customers who are most likely to buy a company’s products and services based on data and research.
ICPs form the foundation for aligning marketing and sales to inform meticulous buyer personas and support the media and creative teams to strategize based on the profile descriptions. By leveraging data, you get a historical perspective of buyer behavior. Research helps provide a real-world perspective. This combines to give you a futuristic view of the emerging trends, consumer behaviors, and paradigm shifts to thoughtfully design your ideal customer profile.
Data Is a Tool for Enhancing Intuition
You may start with some pre-conceived notions about who your ICP is. Your sales team likely has a good idea of who your current high-value customers are and some common traits among them. While that’s an important part of the process, it takes a deep dive into the data to validate those intuitions.
Analyzing Customer Closed-Won Data
Start by understanding and identifying patterns with an analysis of the historical data of deals you’ve won.
Firmographic Makeup of the Ideal Customer
Identify the top revenue-producing industries, verticals, or segments to prioritize and focus your ABM efforts. Within each category, identify the sub-industries to target, including the NAICS and SIC codes. You will also want to compare company profile parameters, such as annual revenue, the number of employees or geographies to feed into the ABM platform.
How to Conduct a Closed-Won Analysis
A closed-won analysis can reveal important information about your ideal customers. With ABM, you can segment categories endlessly to customize and personalize messaging, so the more you know about your best customers, the better you can target.
Identify the accounts with the greatest potential customer lifetime value (CLV). A closed-won analysis should look for correlations between:
- Geography
- Customer type
- Account
- Products or Services
- Deal size
You will also want to track and analyze deals won by marketing campaigns. This will help you better understand B2B buyer motivations and pain points. As part of this analysis, you will want to understand the customer journey and the process of nurturing marketing-qualified leads (MQLs) and turning them into sales-qualified leads (SQLs) and customers. This will help define your marketing strategy for targeting your ICPs.
Finally, you will want to do an attribution channel analysis so you know how and where buyers interact with you.
Analyzing Closed-Lost Data
Closed-Lost Analysis (CLA) is often seen as of secondary importance to a Closed-Won Analysis. However, the reality is that closed lost transactions are just as important for the company’s continued growth.
A CLA helps plan, strategize, and consult on the problems and how ABM can be the solution. From the Closed-Lost Accounts data, we can identify and detail where and how deals got stopped. Look for trends and patterns that indicate:
- Customer Confusion: Identify where customers faced unclear product guidelines, difficulty in understanding the products/services, or nuances with the product interface.
- Lose Connect: Customers should be able to make a connection between product solutions and their problems. If they can’t, they aren’t likely to be customers. It’s crucial to identify where the disconnect occurs in the sales process.
- Price Sensitivity: Understand the significance of price in decision-making.
In each of these areas, you can match patterns with profiles and segments in the same way you do for a closed-won analysis to help build your ideal customer profile.
When you know why a customer has decided not to buy from you, you are better positioned to make adjustments to your assumptions, process, and practice in the future. It can also provide valuable insight as you create your target account list for your ABM marketing campaigns.
How to do a Closed-Loss Analysis (CLA)
To conduct a CLA, you will also want to identify the top 10% of the most valuable accounts lost. If the data is granular enough (and it should be), identify the lead source and the opportunity type.
You’ll want to drill down to identify gaps and disconnects, such as weak links to lead sources or product shortfalls. You’ll also want to evaluate the impact of competitors on deals lost to look for better ways to position your product or service.
As in a closed-won analysis, you want to set research objectives to understand the customer journey and exit points for customers lost.
Your goal should be to identify the top three to four issues that prevent customers from buying so you can improve future marketing campaigns.
Data Has Its Limitations
No matter how much people say data leads to wisdom, data alone is never enough. You can’t base futuristic strategies solely based on historical trends. Oftentimes the data quality is too poor to yield meaningful insights.
You should consider augmenting and enriching your data using third-party tools like 6sense and Terminus. Mixing industry data and buyer intent data with your first-party data can lead to powerful results.
Beyond that, leverage market intelligence and industry insights to identify where the emerging trends lie. After all, you don’t want to miss out on strategizing for the future based on the tail-wind factors for your business.
Finally, don’t underestimate the value of picking up the phone and talking directly to your customers as you build your ICP. Talking to customers you closed and those you failed to win can provide insights that go beyond the data and help you further refine your ICP.
“Research is formalized curiosity, it is poking and prying with a purpose.”
Zora Neale Hurston
Learn more about developing ideal customer profiles and full-service ABM solutions to improve your ROI and shorten sales cycles by contacting BusinessOnline today.
You can also download our free guide: Everything You Need To Know About Account-Based Marketing — A B2B Marketer's Guide To Reaching High-Value Targets.