So now that you know what an ICP is, how do you create one?
We’ve broken it down into 5 simple steps, so that you can begin incorporating productive ICP’s into your business. We also provide an easy to use ICP template and worksheet further along in this article to help your business create adaptable ICPs. Let’s begin!
Step 1: Identify your current “best” customers
Larger companies may have a leg up on smaller ones here — for one thing they have more customers to choose from, and for another, they may be using systems that make it easier to identify their best customers.
Regardless of your company’s size, try to pull data from one of your internal systems — it could be your accounting software like Quickbooks, a Customer Relationship Management system such as Hubspot, or even a simple review of emails or pen-and-paper orders over the years to jog your memory.
Note these companies for the following steps.
Step 2: Make a list of of common traits/characteristics of current “best” customers
Once you’ve identified these customers, then begin the process of identifying the common characteristics between them. Characteristics we suggest that you look at when trying to find similarities in your “best” customers are and are not limited to:
- HQ location
- Age of business
- Growth Rate
- Any unique attribute of the business
It is important to consider when looking for your best customer, this may mean something different depending on what your business values the most. For example, an ideal customer may have a very long lifetime value, or be lowest maintenance, or most profitable, some combination of those attributes, or none of them!
Step 3: Identify why those characteristics make them the “best”
Now that you have identified the common characteristics between your best customers, it is critical that you understand why they are the “best.” This comes from research and outreach.
Research entails diving into the details of the characteristics found between multiple “best” customers. Such as: why is the company growth going up/down? Where is their funding coming from, and is it predicted to increase? Is there something about a particular business type or niche that makes it a particularly good fit for your product or service?
Along with this internal research, leverage your hard-won relationships with your customers to your advantage!
Connect with current “best” customers to better understand why they chose your businesses products/services. How did they come to the decision to adopt your product or service in their business? Who are the decision makers at their company and what aspects influence their decision making process? How does their business use your product or service on a daily/weekly/monthly/annual basis?
These are all questions that can help you come closer to understanding who your ideal customer profile is and the factors that make them your ideal customer.
Step 4: Create your ICP
Congrats–you’ve now done all the heavy lifting, so let’s combine everything you’ve learned into a productive ICP.
Your ICP should include the firmographic categories such as industry, employee size, business objectives, public/private status, revenue, location, growth rate, decision makers/influencers/stakeholders, goals, channels, and budget.
Include your findings from your research and outreach to provide background and further understanding for your sales and marketing teams that will be utilizing your ICP.
A simple spreadsheet will suffice to keep track of your ICP’s primary attributes. Later in the article we provide a sample for your business to use as well.
Step 5: Evaluate opportunities & challenges
For this step, where do you see the use of your product and service benefitting the most, and fitting into the existing framework of a business? Let’s look at an example to illustrate.
Imagine that your business is Good Start Packaging, which sells compostable takeout containers and other food-related packaging accessories. Let’s say Good Start’s ICP is a large food chain.
An opportunity for Good Start is to help food chains build a more environmentally-conscious image with their customers. This would help the brand attract an environmentally-conscious consumer in the first place, and build loyalty among its existing customers for whom the environment is a top priority. In both cases this could increase the food chain’s revenues, particularly in the right demographic.
On the other hand, challenges for Good Start might be that not every locale has easy access to proper recycling or composting facilities, or that the requirements for recycling or composting food-soiled containers are too onerous in a given locale. In these situations, the sustainability aspect of their product becomes less compelling.
Identifying the opportunities and challenges for your ICP is critical for your sales and marketing teams to effectively approach your ideal customers with a message that will resonate with them.
Step 6: Document your ICP
The final step is to ensure that your ICP is easily accessible for both you and your team to use in the future. The more accessible (and adaptable) your ICP is, the more widely used it will be and the more success your company will have with it.