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How To Define Your Ideal Customer Profile For A Target Account List

Stewart Hillhouse
Posted by Stewart Hillhouse|Published on March 21, 2024
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One of the first things that you learn in any business or entrepreneurship course is that you need to have a clearly defined ideal customer profile (ICP) for your business. Otherwise, how else will you know who to try to sell to?

Unfortunately, most companies build an ICP that ends up as a static document summarizing what they know about the customer: the pain points they feel, how they're currently solving that problem, and what triggered them to start looking for a solution.

It looks great on paper, but what we all learn once you get out into the real world is that your ICP isn't much use on its own.

To effectively use an ICP, you need to know how to accurately and consistently identify buyers who match this profile.

In this article, we're going to take a look at how you can create a list of target accounts who match your ICP, and how to make sure your targeting remains consistent and accurate as your business matures.

Firmographics and Tech Stack: The Pillars of a SaaS ICP

If you're selling B2B software, there are two major categories you need to consider when defining your ICP:

  • Firmographics: information about the structure of the company, like geography, employee count, industry, revenue, business model, and anything else that will help to understand the business.

  • Tech stack: the technology tools that the company uses to power their business, like customer relationship management (CRM), content management system (CMS), enterprise resource planning (ERP), and any other software they're using to run the business.

Firmographics and tech stack data are the backbones of defining an ICP.

Why? Because your product needs to play nicely and integrate with the systems they already have in place. If not, you're going to spend too much time and resources trying to sell to a buyer who can't use your product even if they wanted to.

For example, let's say your product needs to integrate with your buyers CRM. But your product only works properly with Salesforce, and not Hubspot. Would you still try to sell to companies who only use Hubspot? Definitely not (unless you don't want to hit your revenue targets).

Here's a firmographic example: if a buyer is geographically based in Sydney, Australia, but your team is based in San Francisco, California, does it make sense to sell to them? Well, if your product requires hands-on support and customer success, then probably not because there's no timezone overlap. Sure, your Australian buyers might make the purchase, but they'd churn soon after because they'd receive no hands-on support.

Knowing this information is vital for filtering potential customers and making sure that they are a good fit for what you provide.

How To Apply This

  • Collect firmographic data such as industry, employee count, and geography to start building your ICP.

  • Analyze potential customers' tech stacks to guarantee compatibility with your services.

  • Use the insights from these providers to refine your marketing strategies and improve targeting.

But how do you gather this type of data to understand your buyers? In the next section we're going to take a look at data enrichment providers and how you can evaluate which ones are right for your business.

Evaluating Data Enrichment Providers

Some of this firmographic and tech stack data is publicly available, either through their website or (in the case of public companies) documents available online.

Artificial intelligence (AI) has made gathering and analyzing large amounts of data like this much easier. But gathering this data manually or even with AI assistance is time-consuming.

That's why I'd recommend using a data enrichment provider first, then manually double-checking your data by doing some independent research to validate everything is accurate.

Data enrichment providers like 6sense and Clearbit play a critical role in understanding your customers. They both provide you with a huge amount of firmographic and tech stack related data for hundreds of thousands of businesses.

Mutiny integrations

Each has their own proprietary dataset and presents different data fields. I'd recommend exploring both platforms and doing your own research to make sure that you use the data source that works best for your situation.

This data is then connected to your CRM, allowing you to create a source of truth for your sales and marketing team to execute your go-to-market strategy with unified data.

How To Apply This

  • Conduct a thorough assessment of your data enrichment providers to determine their strengths and weaknesses.

  • Identify the most accurate and relevant data fields for your CRM to help define your ICP.

Establishing A Target Account List Using Your ICP

Ok, so now that you've got a list of criteria that define your ICP, you've enriched your CRM with account data, and you're eager to deliver the good news to your team.

Before you do, there's one last important detail we need to cover: your target account list.

Think of your target account list as a VIP list for the best after-party ever, and you're the host. Everyone on that list would be a perfect customer, and you want them all to show up.

Well, now that you've got your ICP defined, all you need to do is put your ICP filtering into LinkedIn Sales Navigator, and you'll be presented with a list of all the companies in your market that match your ICP.

Advice For Early-Stage Companies: Start simple with basic firmographic criteria when defining your ICP. This is because you're still learning about your market and likely will need to adjust your product over time to find product-market-fit.

Industry and employee count are good starting points that will give you a large target account list to get started with.

Advice For Mature Companies: If you've got a mature go-to-market (GTM) function, or are relying on outbound sales as your primary growth channel, then you're going to want to apply each criteria thoughtfully.

This is when knowing your buyer's techstack and having historical sales data will help you to make sure your list is accurate and you've got a strong strategy to approach each account with an account-based marketing strategy. Delivering 1:1 personalized landing pages in your outreach is an example of a growth tactic that you can do at this stage.

ABM landing pages

How To Apply This

  • If you're an early-stage company, begin with broad firmographic criteria to define your ICP.

  • As you grow, refine your ICP based on a more detailed understanding of your best-fit customers.

  • Consider physical constraints like time zones when defining your ICP, as they can impact customer support and satisfaction.

Monitoring and Adjusting Your ICP

As you sell to your ICP, you'll gather more data into your CRM about each deal. Important data points like time to close, net dollar retention, average contract value, and cost of acquisition. These marketing and sales metrics are crucial to display on dashboards and constantly use it to adjust your GTM strategy.

Here's the dashboard that we use at Mutiny. It's taken us dozens of iterations to get this right, so feel free to use this template as a starting point, and then adjust it as necessary.

As your product and market evolve, this data will act as your source of truth for helping to decide whether your ICP needs to evolve also.

For example, if you're seeing that it's taking a lot longer to close a deal with a company larger than 1,000 employees, but they stay as customers longer and have a higher average contract value (ACV), then you'll need to analyze your ICP to see how many target accounts match that new criteria.

Depending on the stage of your business, expanding your total addressable market (TAM) by adding more target accounts is the right move. While at other times, restricting your target account list will help your business grow more effectively.

How To Apply This

  • Regularly check the performance of your ICP against key metrics such as lead progression and conversion rates.

  • Adjust your ICP based on real-time data and feedback from sales and marketing teams.

  • Use dashboards to visualize data and make informed decisions quickly.

Consider The Entire Customer Lifecycle

Redefining your ICP and target account list is a dynamic process that requires collaboration, evaluation, and continuous refinement.

By working together with your sales, marketing, finance, and business operations team, you can make sure that your GTM strategies are aligned with your business objectives and that you're effectively reaching your ideal customers.

Remember, it's not just about closing the deal. The most effective companies consider the entire lifecycle of a buyer, from acquisition, to sales, to onboarding, and expansion.

Keep this in mind as you work to build out your ICP and build an account-based marketing strategy.

We've put together the best account-based marketing plays being used by B2B companies to grow. Learn from the best and apply them to your own company to hit your pipeline goals.

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