Sales ICP: How to build & use your ideal customer profile

Sid Khaitan
Published
June 14, 2024
Updated
June 26, 2024
TABLE OF CONTENTs
TABLE OF CONTENT

Ask five sales reps to define their ideal customer profile (ICP) and you'll get six different answers.

SDRs rattle off firmographics and technographics. AEs list the industries and geographies they cover. AMs talk about their biggest accounts. Someone shouts, “Any company with a budget!” 

Then we wonder why:

  • Marketing hands over unqualified leads
  • Sales prioritizes the wrong prospects
  • deals stall as buying committees can’t decide if your product is the right fit

A well-defined ICP is like a big red X on a treasure map. 

It helps you prioritize the right accounts, overcome inertia, and shorten sales cycles. Companies with a clear ICP achieve 67% higher win rates.

In this guide, we’ll cover proven steps to lock down your ICP and align your sales strategy around high-potential targets instead of low-quality leads.

What is an ICP in sales?

In sales, an ideal customer profile (ICP) is a model that outlines the criteria for what makes a perfect customer, so you can prioritize and convert the most valuable prospects. 

In B2B SaaS, those are the companies that most want your solution and will sign the contract quickly.

Key elements of a sales ICP include:

  • Firmographics: Industry, company size, location, annual revenue
  • Technographics: Tech stack, integrations
  • Organizational traits: Business model, operations, digital maturity
  • Behavioral traits: Use cases, customer needs, and pain points
  • Buying process: Budget, timeline, buyer personas

The purpose of defining your ICP is focus and alignment for all your revenue teams.

With a clearly articulated profile, Sales and account-based marketing (ABM) teams can work together to turn prospects into the best accounts. Deals close quickly because you’ve identified companies with pain, which spurs buying committees toward faster decision making.

Since you’re uniquely positioned to help this specific group of people, there are fewer competitive threats and higher win rates.

On our Grow & Tell podcast, Robby Allen, CRO at AgentSync and former Director of Sales Development at Zenefits, said that defining ICP is one of the most rewarding parts of being a sales leader.

He describes ICP as a “way to align the organization around what we're doing and why we're doing it.”

As Zenefits began its journey upmarket toward Fortune 500 enterprise accounts, it leveraged ICP as a blueprint for understanding the talent, post-sales motion, and capabilities needed to support an emerging target audience.

“It's being in the field taking feedback and bringing that back to the business and articulating a position around like, this is who we think our ICP is. This is the data to support it," - Robby Allen, CRO at AgentSync

As your ICP evolves, sales teams are uniquely positioned to use their learnings to shape not only the product roadmap and sales messaging, but also the overall market requirements needed to win.

Sales ICP vs. customer personas

Sales ICPs and customer personas (or buyer personas) are often mistakenly used interchangeably. Both are important but serve different purposes.

If you’re a B2B company, your ICP is a company. It’s not a person. It’s an account in your CRM.

A customer persona refers to an ideal contact (or lead) inside an account who is involved in the purchasing process.

You need both well-defined ICPs and buyer personas to craft targeted messaging that resonates with each prospective account and stakeholder.

Sales ICP examples

All of this sounds great on paper, but what do sales ICPs look like in real life? Let’s take a look at a few examples.

Salesforce’s ideal customer profile

Salesforce is a good one to start with since its ICP spans such a broad range of industries and companies. 

At its core, their ICP is a company with 100-5,000 employees across any industry that sells products or services using a sales team and needs a scalable way to track sales activity. 

However, Salesforce still tailors their various cloud offerings to align with more specific use cases, buyer roles, and processes within those accounts. 

For example, Sales Cloud targets sales operations leaders and revenue teams focused on driving productivity and efficiency. Service Cloud resonates with service managers and support teams. Marketing Cloud caters to marketing operations and demand gen leaders.

While their broad ICP criteria cast a wide net, they segment it into persona-based use cases and value propositions.

Chili Piper’s ideal customer profile

When I worked at Chili Piper, the ideal customer profile centered on fast-growing, well-funded SaaS startups and mid-market software companies.

An important technographic filter was companies already using Salesforce or HubSpot. Prospects without them wouldn't realize the full value of Chili Piper's native integrations.

They needed a way to automatically route inbound leads to reps and book demos quickly. Any drop-off led to revenue leakage, and they didn’t have the time or resources to do all of this manually.

The data team built web scrapers to identify companies with demo request forms on their website, which was a strong signal that they had a steady flow of marketing-qualified leads that needed higher conversion to pipeline.

Our buyer personas were marketing operations leaders, sales managers, and revenue operations roles. These people intimately understood the handoff between marketing and sales, where drop off happened, and the need to maximize each lead opportunity.

Unlike horizontal calendar scheduling tools like Calendly,Chili Piper laser-focused on solving the specific pain points around the marketing-to-sales funnel.

Beekeeper’s ideal customer profile

At Beekeeper, the company I currently work for, we refine our ICP every few months based on the results of the past three quarters.

While hospitality, healthcare, and construction have remained strong verticals for us, we've seen manufacturing and retail opportunities stall due to economic headwinds. Accounts with 50-2,000 employees convert at the highest rate since larger organizations are more cautious with their budgets.

A lot of this orients around the pain we solve and competitive alternatives in the space. We help companies with workers who don’t sit behind a desk and cannot communicate effectively with each other. Larger organizations typically have an in-house solution or are fine with the status quo.

For the deals that don’t fit our criteria, we ask our sales teams to only work those accounts if there is a clear urgency and they don’t expect custom integrations. That way, we can stay focused on the best prospects and avoid spinning the wheels.

How to build your sales ICP in 7 steps

ICPs are built backward.

We compare deals we’ve won with those we’ve lost to reverse-engineer what “good” looks like. To find these companies, we need to search for patterns across our customer base.

Step 1: Decide who your best customers are

Before pulling data, decide who your most valuable customers are. Is it based on:

  • Annual contract value (ACV)?
  • Sales velocity?
  • Customer lifetime value (LTV) over acquisition cost?

This key success metric becomes your North Star for building a data-driven list of ideal customer accounts to analyze.

Step 2: Get input from other teams

As Robby Allen points out, “the company with the highest probability to buy from us” and the company “with the highest probability to be successful with us” aren’t always the same.

We have to look past the sales cycle to factor in both early-funnel conversion and long-term retention. That’s why it’s good to get input from other teams.

Marketing sees which leads best convert into demos. Customer Success knows which clients are difficult when implementing the product and tougher to retain.

Get a 360-degree view of your ICP by asking:

  • What leads do we disqualify most often?
  • Where do we get the most "hand-raisers" ready to buy?
  • Which customers have the fastest time to value?
  • Who do we have the highest churn risk with?

These questions broaden our scope of what defines a great customer: easier to convert into demos, get to first value quickly, and then stick around for a long time.

The challenge is that buyer and customer engagement data isn’t readily available in our CRMs. 

But here’s the good news: if you’re using Dock for sales rooms and onboarding portals, Dock’s Reports dashboard lets you see who your most active customers are during the buying process, through onboarding and implementation

With this data, you can find even better correlations to qualified pipeline, close rates, and time to close.

Step 3: Prioritize ICP attributes

Now for the fun part: finding connections between common attributes and overall account value.

From your current customer data, identify the main firmographic criteria, such as company size, geography, industry, technologies used, etc. These form the foundational filters for your ICP.

Which ones trend highest for your most valuable accounts? Pick the top 5-7.

Then layer in common characteristics that make a company an ideal fit, like deal velocity, growth stage, and any other factors that may stand out.

The end result is a list of the common characteristics of your best customers.

Step 4: Detail the buying committee

We have to peek into the top accounts to map out the buying committees.

By understanding all the roles and stakeholders that are involved in the buying decision, you can recreate those situations and ensure your reps multithread to pull in the right people at the right time.

Step 5: Create an ICP document

Once we have the information in our heads, it’s time to get it out into the world. 

A slide or two should be enough. It’s meant to be an easy reference guide.

These ICP one-pagers should include:

  1. A ranked list of primary ICP attributes and definitions (e.g., industry, then size)
  2. Ideal values, ranges, or criteria for each attribute (e.g., 50-500 employees)
  3. Qualitative information on pain points, buying committees, and use cases you win on
  4. Relevant customer stories and logos
  5. Guidelines on when exceptions can be made, like needing to ask sales management if the customer doesn’t meet the threshold of 50 employees

💡 Pro tip: It’s helpful to share sample call recordings that show what happens when you sell to your ICP. This reinforces the message with reps and shows “what’s in it for them” if they get it right.

Step 6: Enable your sales teams

Every stakeholder on your sales team needs something different. To make ICP actionable, we need to personalize it for different teams. 

  • BDRs need prospecting guidelines and qualification rubrics
  • AEs want to dig deeper into common objections and competitive positioning
  • CSMs and AMs are looking to understand how to engage more stakeholders
  • Buyer champions need ROI reports and case studies to send to their economic buyer

Customize the collateral your champions see and make sure it’s tailored based on use case, industry, and more. 

The problem with this approach is that most sales content management tools make it really hard to sort content this way. The best content gets buried in a series of nested folders that reps never sift through.

Dock’s Sales Content Management System solves this problem by letting you organize content into Boards and Collections. Assets can be labeled with multiple tags—e.g., the asset type and the intended ICP—so reps can easily pull up the most relevant content.

Another way to get around this problem altogether is with digital sales rooms

Instead of dumping a pile of assets on reps, you can build a templated digital sales room that’s already pre-segmented for each ICP. For example, you can have one sales room for your enterprise audience, another for your mid-market audience, etc.

The best part is that RevOps doesn’t have to update each individual workspace whenever you want to make a change. You can push new updates at scale to all prospects and customers with the click of a button.

Step 7: Test and refine

ICP documentation and refinement is an ongoing program—not a one-time project. 

By monitoring conversion rates, deal sizes, and sales cycle lengths, you find out if accounts matching your ICP convert better. If not, it’s time to pivot.

Then, it’s just a matter of reinforcing ICP through training, certification, and feedback loops to ensure it actually gets used—especially as new reps are onboarded.

Use role-playing exercises to make sure every rep knows how to work those accounts.

How to use your sales ICP to qualify prospects & close deals

Once you have your ICP nailed down, what do you do with it? 

Qualification criteria

There’s a push-and-pull effect that happens as you add more filters to your ICP. You can end up disqualifying a part of your total addressable market (TAM) that could actually be a good fit.

Marie Gassée, Head of Go-to-Market at fintech company Column, faces the challenge of serving a diverse customer base—from legacy insurance companies to fintech startups.

On Grow & Tell, she told us, "We find pain that we can solve in so many different company profiles."

Knowing that they are a premium solution, they’ve decided to use deal size to qualify accounts for now. But Marie advises against being close-minded about your sales ICP too early on.

"Approach go-to-market with a lot of curiosity early on,” Marie advises. It takes time to gather enough data and come up with a concrete ICP.

Prospecting and outreach

ICP isn’t limited to company characteristics—it also includes customer personas inside of a buying committee.

Psychographics are a powerful tool for identifying champions who are most receptive to your product and point of view. You don’t have to settle for job titles and demographics.

Kyle Norton, CRO at Owner and former VP of Sales at League, joked on Grow & Tell, “If we could run a LinkedIn search algorithm to just find all the people that were wearing tech fleece hoodies and disqualify anybody who's wearing a blouse or a tie in their LinkedIn profile, that's how we should prospect.”

Kyle’s team realized there was no point in pitching to someone with an old-school view of HR. They needed to get in front of a forward-thinking leader who understood the importance of providing a top-notch employee experience.

Often, the best insights come from understanding the mindsets of buyer personas inside of an account. 

Positioning and messaging

We want products that are made for us. 

A key part of sales positioning is showing how our solution is the best fit among other alternatives. To do that, you need to quickly surface a tailored value proposition and relevant case studies.

It’s easy to get this wrong, especially for newer salespeople who are still learning the ropes.

Andrew Hollis, Co-Founder and Director of Sales at Nectar, turned to Dock Workspaces to standardize their sales efforts and improve their follow-up game.

With Dock, you can create templates filled with the right stories and content for different buyer groups. This accelerates your sales motion and personalizes the approach to the prospect.

“Now, the first follow-up that a new rep gives is of the same tier as someone that's been here for two years using Dock every single day because they're copying that template,” said Andrew.

It’s a lot easier to train reps if your sales enablement content is already tailored to the insights you’ve gotten from building the ICP. And it makes prospects happy too.

By implementing this process, Andrew saw a 31% year-over-year increase in win rates.

Lead scoring and sales forecasting

Which accounts should your reps spend the most time on in their book of business? 

If their schedule is packed with demos, you want them working on the biggest accounts that are most likely to close. ICP helps us direct sales efforts toward a target audience with more buying signals.

Third-party intent data from account-based marketing tools only take you so far. We need a way of figuring out which prospects are active in the sales cycle and reviewing your materials. If not, it’s easy to waste time on a lead that’s gone cold.

Source: Mailshake

When you use a sales deal room like Dock, this analysis is built-in. You can see:

  • when and how often your buyers view your space
  • what content your buyers engage with
  • how many steps are completed in your mutual action plan
  • time spent viewing and/or downloading PDFs or slides, including time per page

This gives sales leaders a window into what’s happening inside an account instead of relying on each rep's gut feelings.

With so much of the buying decision happening behind closed doors, CRM data doesn’t deliver enough buying signals after a demo call to inform sales forecasting.

Being able to monitor engagement is a great way to filter ICP and help your reps prioritize which accounts to focus on.

Account mapping and multithreading

An overlooked part of ICP is the buying committee.

More and more decision-makers are involved in the buying process. Recent research says the average number of stakeholders involved in a purchase decision has risen to 11 people

Your champion can’t do it on their own—they need help from other influencers, support from IT, and/or signoff from finance.

It’s not easy to identify those people. Multithreading is critical, but it’s not just about DMing different job titles inside an account. It’s about building consensus.

That requires your reps to see who else is getting involved in the evaluation process. Once your pitch deck gets sent to the champion after an initial demo, you want to know where it travels next. 

A shared workspace in Dock makes that possible.

Reps can see the emails and names of everyone else who has opened the workspace. They now know which other stakeholders need to be involved.

Check out the People Analytics on a deal that closed recently for Dock’s own sales team. Thirteen different buyer contacts checked out the sales room over the course of the deal.

As people checked out the deal room, Dock’s sales team was able to call it out to the buyer champion and ask if it was someone who needed to be brought into buying conversations.

And if you compare that to a deal room where only one buyer contact ever checks it out — that’s a great buying signal.

This is super important for ICP definition. You start to learn when different buyer personas on the buying committee need to be involved across the sales cycle instead of waiting until it’s too late. As you map the account, you can prioritize better and unlock new use cases.

Use your sales ICP for good with Dock

Knowing your ICP is table stakes. It’s what your reps do with the information that matters.

Top sales teams operationalize what they’ve learned to prioritize, engage, and grow accounts. 

Dock gives your reps the power to engage buying committees faster, deliver target messaging, and push deals forward. Buyers benefit from a more transparent sales process.

Everyone wins. Set up your free workspace now to see what it’s all about.

Sid Khaitan

Sid Khaitan is a product marketer and content strategist. Sid is currently the Senior Product Marketing Manager at Beekeeper and was formerly at Chili Piper.