An Ideal Customer Profile (ICP) is the picture of your ideal customer. Or better said, the data points that make up that ideal customer.

Building an ICP is the foundation to establishing effective Sales strategies, yet rarely done properly (including by myself).

It is also necessary to ensure alignment of Sales & Marketing.

Steps

• list USPs (has to be as unique/differentiating as possible)
• list pain points solved with these USPs
• derive use cases from pain points solved
• list/quantify the business value of solving the pain points
• list/quantify the COI (Cost Of Inaction)
• find industries/companies who have these use cases & pain points
• define the personas within those companies who drive those use cases / experience those pain points
• create a nomenclature of "lingo" used by these industries/companies
• list questions (using the target's lingo where possible) for reps to ask during the outreach/qualification/scoping stages
• prioritise industries/companies based on potential revenue opportunity (+ additional criteria like sales cycle length, compliance requirements, etc..)

If established customer base: look at your data & internal insights as a starting point.. it can surface patterns & insights that are not obvious.
The obvious is to focus on your current best customers and target same industries/similar companies, but data/insights might surface for example that another industry has more potential.

Data points can include:
- CLV (Customer Lifetime Value) / total revenues to date
- revenue trend over time
- ACV (Average Contract Value or Annual Contract Value)
- NPS (Net Promoter Score) - though I'm not a strong believer in NPS personally
- growth expectations
- referral history (if available)
- brand equity

If early stage startup: keep in mind the ICP needs to be flexible, to find/maximise Product-Market Fit. The first customers might not be the best ones to focus on.

Let's dive into each:

USPs

Being clear about your Unique Selling Points (what makes you unique vs your competition) is fundamental.
Articulating them in a way that is easily understandable and immediately positions your solution against the backdrop of similar solutions will help many parts of your end-to-end Sales process - from strategy to daily tactics.

Pain points

Use cases

Business value

COI (Cost Of Inaction)

Target industries/companies

geography

company size

technology used

if relevant to the product/services you sell, eg because you have a native integration with X

Personas

Also called "buyer persona".

Defining a persona can mean narrowing down the following elements about the typical person who is buying your product/service:
- title (helps to find them!)
- promotion path
- demographic
- challenges & pain points they have

Why "promotion path"?
It's an uncommon one, but I like to think about what that persona might want to evolve to - eg if her next step is to become a VP with greater responsibility, is there a way for the product/service to help her be seen as strategic and fit for the promotion).

Research:
- are they active on social media (eg Linkedin, Twitter, etc.)
- where do they meet (events, conferences, online communinities, etc...)
- what do they read (blogs, newsletters, influencers, etc..)

One approach is to "personify" personas by giving each a name, eg:
- Paul: Product Marketing Manager in a SaaS company, etc...
- Alia: HR Manager in a large FMCG company, etc...

At first I did not like that approach, finding it "childish" (for lack of better word). But where it can help is as an index/reference to the persona, eg. "Alia campaign".

Lingo

Prioritising

You can breakdown your list in tiers, allocating different resources to each tiers, based on the weight you decide to assing to each criteria.

However, the best in class have a laser focus on their #1 ICP, perhaps with one or two more only - but overall not pursuing anything outside of their core ICP.

Possible criteria for prioritisation:

Potential

revenue

This is the default/primary prioritisation criteria.

satisfaction

renewals

expansion

Customer Acquisition Cost (CAC)

sales cycle

eg if you are looking to make an impact quickly, don't go after Government or Financial Services companies - they have the longest sales cycles (though planting seeds in the background will yield results long term).

compliance

eg ensure your product/services has what it needs to pass compliance of the industries/companies you prioriise.

Discoverability

prioritising industries/companies/personas hard to find (eg not active on Linkedin) can weigh in your prioritisation decision.

Execute

Multiple ICPs will emerge from the above exercise - ideally tiered.

Prospecting & Marketing

• "elevator pitch", eg "we help {Alia} do {X}"
• email campaigns leveraging questions/lingo defined
• landing pages per persona, to be used as CTA in outreaches (+ provides SEO benefits for inbound lead generation)

Selling

• one-pager for each.
• script / questions list.
• list of resources to add value to them at each touchpoint.
• co-selling strategy: find co-selling partners that address the same companies/ICP in a complementary way

Closing

• executive summary (board level) of "why you should buy our product/service": articulating this becomes much easier with a firm grasp of the ICP.
• referral: asking specifically yields better results (eg "do you know any other {Paul} in your network who might also {suffer from pain point}?")

Good Resources

"The Qualified Sales Leader - proven lessons from a five time CRO", by John McMahon (2021)
"The Sales Acceleration Formula: Using Data, Technology, and Inbound Selling to go from $0 to $100 Million", by Mark Roberge (2015)