Ideal customer profile vs. buyer persona - are they the same? Which is more important? Do you need both in developing your sales and marketing strategy .There is often confusion between the two in B2B marketing and whether you need to develop one or both. Marketing entails getting a clear understanding of who your target audience is. It is not about appealing to everyone and attracting no one. Your product offerings solve for certain customers - who are they - both ideal customer profile and buyer personas are connected up to this point and help you in honing in to your right audience. However, they are not the same.
Let’s understand each of them separately to appreciate how they are different.
ICP or Ideal Customer Profile
If you have been thinking of implementing an ABM/ABX program and utilizing an ABM platform, one of the first things you are going to need to do is to develop an ideal customer profile. An ICP is a comprehensive ideal customer profile for a target account or business that will hugely benefit from your product or services as well as add significant value to yours. Not every company in your CRM (Customer Relationship Management software) will fit into this category, there may be some that are just a better fit than others. The idea is to focus on those handful of high-propensity businesses (depending upon the size of your business, typically 20-100 accounts) that will most likely hit the ‘purchase’ button faster than others.
An ICP gives you the following benefits :
Improves lead generation
Improves lead scoring efforts by hastening the process
Better account relationships
Better understanding of customer journey
Tailor better go-to-market strategy
Efficient use of your marketing resources - both budget and employees
In identifying and selecting an ideal customer, your focus should be current as well as potential customers. You are not going after Total Addressable Market (TAM), instead just your most perfect accounts that are likely to convert, stay and become brand advocates.
A good starting point is gathering and analyzing data from your CRM and other systems to identify firmographic, behavioral and environmental attributes shared by high revenue generating accounts. Some criteria to keep in mind are - Size of the company including number of employees, Location, Vertical, Budget, Current technology they are using etc.
If your goal is account expansion, maybe there is low hanging fruit to be looked at when starting out - accounts that are already doing business with you. Look at the ones that generate top revenue, have high Annual contract value (ACV) or LTV.
An ICP Example for a B2B SaaS ecommerce company will look something like this -
Our ideal clients are small to mid- size brands, located in North America, in industry verticals such as retail, manufacturing, hospitality and food and beverage. Their annual revenue is between $10 - $60 million. They currently use legacy systems with challenges such as - Data silos, security and integration issues.
So who develops an ideal customer profile? Although Marketing owns ICP development, this really is a company wide effort in high growth companies. You want sales, customer success and executives to be on board not only in the development efforts but also in implementation.
While ICP focuses on selective accounts on an organization level, buyer persona entails getting clear on individuals that make up buying groups in your target segment. According to Gartner, there are about six to 10 decision makers on an average on the buying committee. Using the SaaS Ecommerce company example from above, when developing personas, you will be focussing on doing a detailed analysis of demographics, goals, interests, motivations, emotional needs and pain points of each of these people. They may be CTOs, CMOs, VPs, Directors and Managers, your goal though will be to look past their titles and get to know them on a human level so you can figure out how your product offerings add value to them - their job and roles.
When you get to know your individual buyers well, you reap the following benefits -
Engage them better by creating personalized content and conversations
Showcase your expertise and that you understand them and what they need
Understand their buying process better
Deliver a better Customer Experience
Adapt your sales process to meet their needs
To sell and market effectively, you need both ICP and Buyer Personas. They help your sales team be hyper focused by using their time efficiently while aiding the marketing team deliver personalized experiences, shorten the sales cycle and achieve better ROI. You want your customers to be happy and spending time in clearly defining the two is a critical step.