Ideal Customer Profile (ICP) has been the buzz word for Product Marketers off late, and I find a lot of the content describing it is unnecessarily complex. Its really a fairly simple but extremely useful concept that build on your understanding of users personas. Let’s dive into how we can use ICPs to optimize your GTM activities after launch.
After shipping a product, you’ll notice there are segments of users that exhibit different levels of product engagement, monetization opportunities, require varying levels of support. The user persona where you currently have the best product-market fit is your ICP. These are users who highly engaged with your product, have the best retention rates, may have best LTV, or fastest payback CAC period, and are your biggest evangelists. How you assess having product-market fit or engagement can obviously vary by product, but in general these are users who realize the most value from your product.
Why understand your ICP
Its essential for product marketers to understand their ICP
- Fine tune your positioning/messaging: Understanding the behaviors of your ICP and more importantly why they behave that way can inform your messaging strategy. Knowing what motivates your ICP to use and advocate for your product is a key input into optimizing your value propositions.
- Improve user acquisition with better targeting: Having a good handle on who your ICP users are will give you valuable insights to inform your targeting. Ensuring your user acquisition efforts are directed towards a target audience that showcases the same attributes as your ICP will improve the returns on your acquisition spend. . With an ideal customer profile in hand, you can create content and campaigns tailored to those customers.
- Find product gaps, and informing product roadmap: Identifying who you’re producing is working well for (your ICP) sparks discussions around why it’s not working well for other users. These inputs can be valuable in prioritizing whom to build for next, building empathy for those users, and knowing what to build to win with those users
Identifying your ICP
Since ICP is your most engaged users, it always best to start with driving alignment on how your team/company defines “high engagement”.
Follow this with an exercise to identify objective characteristics of your ICP. This should obviously include their product usage attributes – are they more likely to use a specific feature, or is their frequency to use is higher? Do they exhibit a certain purchase/trial path? It can also include demographic attributes – do your most engaged users tend to be in one particular industry, or have a certain tenure, or are above a certain revenue threshold? Using this information you can paint a fairly comprehensive picture of your ideal customer profile(s).
Once you identified your ICP, next, use a mix of quantitative and qualitative research to dive deeper into what makes them distinct from other users – collaborate with sales, listen to customer feedback, analyze user surveys and interviews. This exercise will help you better understand their motivations, needs and preferences, and allow you to define your ICP with more depth.
Finally synthesize the insights and share them with all stakeholders so that you have a shared understanding of your ideal users