Don't mistake activity for achievement. Staying active with marketing campaigns and making moves is not enough; making the right moves focused on the correct segmented target audience, is what is required to achieve success. For this reason, identifying and targeting a focused segmented audience with detailed precision, your most profitable micro-segment, is absolutely imperative. One of the growth tools that can be implemented to accelerate your path to further stages of growth is ICP, Ideal Customer Profile.
The tools of ICP Analysis and Marketing allow you to identify a niche micro-segment target market within your Total Addressable Market (TAM), and focus your marketing and message to that segment. Niche down your ICP into smaller, more focused categories and qualification criteria. Consider what percentage of revenue comes from each ICP. Consider Win Rate (Conversion), Churn Rate (rate at which a customer would leave that demographic or firmographic), LTV (Lifetime Value, total lifetime monetary value of a customer), and ACV (All Commodity Volume, total value generated by the entire ICP).
Analyze the considered market. Create several ICPs (ICP-A, ICP-B, ICP-C, ICP-D) before choosing your Initial Customer Profile. The Initial Customer Profile will be the first Ideal Customer Profile (ICP) which is focused on when initially launching your growth strategy. Begin to target your Initial Customer Profile by finding segments within segments, focusing on the potential audience with the highest rate of profitability and longevity as customers, and once achieving maximum engagement and profit optimization with that ICP segment, you then earn the right to expand your Niche ICP to a larger, broader portion of your Total Addressable Market (TAM).
View each potential ICP and its qualified candidates through Qualitative & Quantitative Lenses. Identify the patterns.
Qualitative Questions: Who has the more urgent and/or important problem?
Quantitative Questions: What percentage of revenue comes from each ICP? Consider Win Rate, Churn Rate, Lifetime Value, and All Commodity Volume.
Understand the difference between your Total Addressable Market (TAM) versus your Ideal Customer Profile (ICP), and most importantly, your Initial Customer Profile. With your Initial Customer Profile, target a core market segment, and create a growth engine by focusing on your niche-level ICP. Build your ICP, mobilize your strategy, and create a GTM (Go-To-Market) Machine.
It's also important to define who does not qualify to be in your ICP. Through discovery calls, running focus tests, and/or controlled experiments, you can determine if your ICP is the most effective ICP, or if the identity of your ICP needs further optimization.
Identifying your ICP:
The ultimate goal is to define who your customers are in an effort to understand them and their needs in more detail in order to better frame the benefits of your products or services to match their needs and wants. Identifying the following points will give you more clarity in regards to the process of crafting your ICP:
Understand Who: Who are the segment customers with an urgent, important, and/or frequent problem that must be solved? Define your audience.
Customer Needs: What do the customers need in order to solve their problems, obstacles, challenges, issues, needs, and/or wants?
Understand What: What are the demographics and/or firmographics of your newly identified ICP?
Customer Solutions: Craft a marketing and execution strategy to market to your ICP, and fulfill that segment's needs and wants with results that are successful for both the customer and your company.
Customer Backstory: What challenges are customers having in their business life (and possibly personal life)? Identifying all aspects of why the customer is considered to be in your ICP, what issues they need to have resolved, and why you are the one to solve them. Define your client.
Define your Competition: Through SEO & SEM analysis and research, among other available analytical tools, you can observe and deduce the target ICP of your competitors to gain knowledge and advantage.
For more information on how DYMONSTAR can leverage the amazing and effective tools of ICP Analysis and ICP Marketing, contact us today!
