This past week I had the opportunity to talk to Don Taylor with HSPO and our sales team about how one can improve the sales process and to figure out why clients went with your company and why they stayed doing business as well. One of the main topics we discussed was knowing the importance of an ideal customer profile (ICP).
According to Gartner, a leading technology research and consulting company, “The ideal customer profile (ICP) defines the firmographic, environmental and behavioral attributes of accounts that are expected to become a company’s most valuable customers.”
The main goal when identifying your ICP is to focus on the most valuable customers and prospects that are also most likely to do business with you or your company.
These valuable customers contribute to the largest sales year after year and is crucial to any sales team success. According to Gartner, companies that invest in a well defined ICP achieve compelling business results including:
- Faster sales cycles
- Higher conversion rates
- Great average ACV (annual contract value) and LTV (lifetime value)
HW Media’s study conducted with SOAR Performance Group that analyzed companies’ marketing priorities, tactics and budget allocations for 2022 unanimously reinforced the importance of an ICP with all responding firms having a defined ideal customer profile.
Despite this finding, results are mixed with 60 percent saying the marketing and sales team know and prioritize their ICP which could lead to a lack of conversion rates for accounts, and slower sales cycles.
Gartner furthers this point by also indicating that, “Research into ICP development practices has found that in some companies, the ICP is either poorly understood as a concept or not properly defined. Even in companies that have defined an ICP, its use is limited to marketing briefs or new hire orientation sessions.”
Any sales team, regardless of their industry can benefit from a clear ideal customer profile. In the future we will continue our deep dive to uncover the connection between the ICP and how to improve the sales and marketing teams’ understanding of its importance.