Ask a sales team who their ideal customer is and you often hear: "Anyone who wants to buy." That is honest, but it helps nobody. An account manager with a hundred prospects on his list has to choose. Without a documented ideal customer profile, he picks whoever is easiest to reach, not whoever brings in the most.
What an ideal customer profile is
An ideal customer profile describes the kind of organization where you deliver the most value and earn the most. It is about companies, not people. Who decides inside that company comes later in the sales process.
The profile is not a wish list. It is a filter. A prospect that does not fit can still become a customer, but does not get priority in your week.
Five criteria for your ideal customer profile
Choose at most five criteria. More than that becomes a form nobody fills in. For most B2B companies in the SMB market, these work well:
- Industry. In which industries do you deliver on your promise best? Look at your ten best customers today.
- Size. Number of employees, locations or another measure that fits what you deliver. A wholesaler looks at construction sites, a software company at users.
- Trigger. Which situation makes a customer receptive? A move, new legislation, growth, a supplier that left.
- Region. Can you serve the customer the way you promise, including service and visits?
- Potential. What could this customer buy in three years if everything goes well?
Give every criterion a threshold you can check. "Big enough" is not a threshold. "At least twenty technicians on the payroll" is.
How to find the criteria in your own customer base
You do not have to invent the profile. It is already in your numbers. Take your customer list and sort the customers by margin over the past two years. Then look at the top ten and the bottom ten.
- The top ten. What do they have in common? Industry, size, how they found you?
- The bottom ten. What do they have in common? You often see customers here who chose on price or who ask for a lot of service for little revenue.
- The most loyal customers. Which customers stayed with you the longest? That says something about where your promise lands best.
Do this with two or three sales reps in the room. They know which customers are a pleasure to work for and which ones drain energy. That is not in the numbers, but it belongs in the profile.
Step by step to an ideal customer profile
Count on two sessions of ninety minutes. This is how to go about it:
- Get the numbers. Customers with revenue and margin over two years, plus industry and size. An export from your accounting system or CRM is enough.
- Sort by margin. Not by revenue. Mark the top and bottom ten.
- Look for patterns. Write down what you see per criterion. Which industries keep showing up at the top? Which size?
- Test with your sales reps. Do the patterns match what they notice in conversations? Where is the energy, where is the irritation?
- Set thresholds. Make every criterion measurable. A number, an industry code, a postal code area.
- Test on ten prospects. Sort them with your new profile. Does the outcome feel logical? If not, adjust a threshold.
From profile to classes
With the criteria you can sort prospects into A, B and C. An example: a prospect that meets four or five criteria is A, three is B, fewer is C. The A prospects get most of your account managers' time, the C prospects at most an email per quarter.
Use the same logic as for your existing customers, so that a prospect who becomes a customer lands in the right class straight away. Otherwise you have two classifications that contradict each other.
A fictional example: an installation company chooses
Take a fictional installation company in climate technology. The team thought their best customers were large offices. Those brought in the most revenue.
After sorting by margin, it looked different. At the top were healthcare organizations with one to three locations. They asked for fixed maintenance contracts and paid on time. The large offices sat in the middle. Lots of revenue, but hard bargaining and a lot of extra work that was difficult to invoice.
The profile became:
- Industry. Healthcare and education.
- Size. One to five locations, each with its own installation.
- Trigger. An expired maintenance contract or a renovation within two years.
- Region. Within an hour's drive of the office.
- Potential. At least one maintenance contract per year, with a chance of replacement.
The large offices remained customers. They were simply no longer actively pursued. The time that freed up went to healthcare organizations in the region.
Common mistakes
Basing the profile on revenue alone. A large customer with a small margin and many complaints is not an ideal customer. Also look at margin and at how well your promise fits.
Not daring to narrow down. A profile that fits everyone filters nothing. Choosing feels like leaving customers behind. In practice, the right customers get more attention.
Writing the profile down once. Markets change. Check at least once a year whether your best customers still resemble the profile.
Not sharing the profile with marketing. If marketing generates leads outside the profile, your sales reps spend time on the wrong conversations. Make sure everyone uses the same definition.
How to start tomorrow
You do not have to wait for a strategy session. Ask for an export of your customers with margin tomorrow. Sort them and look only at the top ten. Write down three things they have in common. Put that in front of your team at your next sales meeting and ask: "Do you recognize this?" After that conversation you have a first version. It is not perfect, but it is better than "anyone who wants to buy".
How the customer profile connects to the other building layers
The ideal customer profile belongs to building layer 1, the Sales foundation. It sits next to your promise and your core values. That makes sense: your promise lands best with customers who suit you.
Further on, the profile carries through. The classes A, B and C determine the contact cadence and the activities in building layer 4. The prospecting norms and KPIs in building layer 7 build on it. And in building layer 2 it determines which prospects are allowed into the first phase of your sales process.
Frequently asked questions
What is an ideal customer profile (ICP)?
An ideal customer profile, or ICP, describes the kind of organization where you deliver the most value and earn the most. It is a filter for where your selling time goes.
What is the difference between a customer profile and a persona?
A customer profile is about companies: industry, size, region. A persona is about the people inside that company: their role, concerns and questions. You start with the profile and work out the personas afterwards.
How many criteria does a good ideal customer profile have?
Five is enough for most SMB companies. More makes the profile hard to use. More important than the number is that every criterion has a measurable threshold.
How often do you update an ideal customer profile?
Look at it at least once a year, or sooner if your market changes. Compare your best customers today with the profile. If they no longer resemble it, it is time for an update.
Capturing it
Capture the industries in the building block Industries and the criteria with their thresholds in the Account matrix of building layer 1, on the tab for prospects. The profile itself, with its criteria and thresholds, has since October had its own place in the new building block Ideal customer of building layer 1. Because your prospecting norms, your prospect mix and your contact cadence build on it, a change shows you straight away what needs another look further on.