- Reading Time: 10 minutes
- Category: Sales Fundamentals
Intro
"Don't mistake motion for progress"
-One of the Facebook mantras
In the context of a company, your target audience sets the direction of both sales and product, which are arguably the two most important components of a B2B business.
ICP Definition
- ICP: Ideal customer profile, or in some cases, ideal customer persona
- Customer profile: who you sell to, in terms of business and/or people characteristics (this is largely based on verifiable facts, such as size and geography)
- Ideal: has the best-potential fit or need for purchasing your solution (this is hypothesis-driven and requires validation)
Customer profiles can be defined using many kinds of criteria, including common characteristics like:
- Geography: where is the business based?
- Size: how many employees does the business have?
- Revenue: how much money does the business earn?
- Industry: what sector(s) does the business focus on?
- Events: has the business gone through specific events recently that imply a new demand or challenge?
Common mistakes
Since an ICP definition sets the direction of your sales efforts and technology investments, it is important to be aware of common risks and how to avoid or mitigate them so that you can set your team up for success.
Too shallow
Sales teams often come up with customer profiles that are too general, resulting in unnecessary resources being spent pursuing businesses who are not a strong fit.
Here are examples of customer profiles from the point of view of a company that sells B2B SaaS software for hospitals to automate data-related tasks.
Example of a shallow profile:
- Geo: US-based
- Size: 50-200 employees
- Revenue: $10M-$50M in annual revenue
- Industry: Healthcare
Example of a more in-depth profile:
- Geo: US-based in southern or midwestern states
- Size: 50-200 employees
- Revenue: $10M-$50M in annual revenue
- Industry: Healthcare
- Type: Hospital system
- Operations: Accepts at least 3 different health insurance types
- Event: Published at least one job in the last 3 months related to administrative tasks
- Facilities: Has a bed capacity between 30-60
- Facilities: Has 2-3 locations
The second profile is more detailed, which helps sales reps identify businesses that are more relevant–i.e. customers who are more ideal. Having more details is important because it ultimately means faster lead generation and better conversion rates through the sales funnel.
Lack of business rationale
In the previous example, we saw how adding more detail helps address shallow customer profiles, which essentially is a quantity issue.
On a similar note, the way to tackle quality is by connecting the profile criteria to actionable business drivers. These drivers are what sit between the problems that your customers have, and the solution that your company provides.
Here's what the profile looks like reusing the previous example and adding business rationale:
| Type | Criterion | Business rationale |
|---|---|---|
| Geo | US-based in southern or midwestern states | These regions have fewer tech hubs compared to the west and east coast, which means hospitals here tend to have outdated tooling. |
| Size | 50-200 employees | This is early-mid size, which is when hospitals begin to get overwhelmed with data and need to start scaling. |
| Revenue | $10M-$50M in annual revenue | Another indicator of early-mid size. |
| Industry | Healthcare | The specific industry of focus. |
| Business type | Hospital system | The specific type of business. |
| Operations | Accepts at least 2 different health insurance types | Supporting 2+ insurance providers means the hospital has to manage multiple types of patient data, which is very time consuming and complex. |
| Event | Published at least one job in the last 3 months related to administrative tasks | This shows that the business is already investing in scaling their data efforts. |
| Facilities | Has a bed capacity between 30-60 | Another indicator of early-mid size. |
| Facilities | Has 2-3 locations | Another indicator of early-mid size. |
You can even go one step further and include how your solution fits into the picture, which helps make your messaging more targeted and compelling when it comes to outreach and sales calls.
Here's what the previous profile might look like with solution rationale for the applicable criteria:
| Type | Criterion | Business rationale | How our solution fits |
|---|---|---|---|
| Geo | US-based in southern or midwestern states | These regions have fewer tech hubs compared to the west and east coast, which means hospitals here tend to have outdated tooling. | – |
| Size | 50-200 employees | This is early-mid size, which is when hospitals begin to get overwhelmed with data and need to start scaling. | – |
| Revenue | $10M-$50M in annual revenue | Another indicator of early-mid size. | – |
| Industry | Healthcare | The specific industry of focus. | – |
| Business type | Hospital system | The specific type of business. | – |
| Operations | Accepts at least 2 different health insurance types | Supporting 2+ insurance providers means the hospital has to manage multiple types of patient data, which is very time consuming and complex. | We have a feature that allows you to consolidate data from any insurance provider into a single, consistent type. |
| Event | Published at least one job in the last 3 months related to administrative tasks | This shows that the business is already investing in scaling their data efforts. | Our service only costs a fraction of one admin equivalent employee, and can deliver the productivity of a team of five people. |
| Facilities | Has a bed capacity between 30-60 | Another indicator of early-mid size. | – |
| Facilities | Has 2-3 locations | Another indicator of early-mid size. | Our platform supports multiple locations so that all of your team members can work in a consistent, shared workspace. |
Putting this into practice
Defining and going after your ICP starts at the top of the sales funnel via:
- Lead generation: identifying businesses who meet your ICP criteria)
- Outreach: getting in touch with those companies).
While there are many solutions that allow you to search for leads, most only support shallow filters such as geography, size, and revenue.
Scout AI is the leader in intelligent lead generation, enabling you to automatically identify businesses based on the most granular and complex ICP criteria, such as the hospital example in this post, and can perform the following:
- Real-time LinkedIn profile validation (to check that a given profile is valid and the employee still works at the target company)
- Sales kit PDFs (rich, data-backed reports to help SDRs quickly understand a target account before sales calls)
- Complex web scraping (visit multiple pages on a target account's public website to confirm or extract information)
- Rich intelligence (including recent news articles, job postings, and intent signals)
You can learn more about Scout here.
Happy prospecting.