Thanks to the digitalization of the marketplace, online and ecommerce businesses can now reach more clients than ever.
Due to the staggering number of new businesses and potential clients that inhabit the marketplace, companies must know the difference between ideal customer profiles (ICPs) and buyer personas, in order to craft the perfect strategy for using them.
Thankfully, we have compiled some basic ideas that will help businesses like yours make the right choice (or no choice at all, but more on that later).
Understanding ICPs
Despite having played a solid role in business language for almost 30 years, the terms “buyer persona” and “ICP” are often used interchangeably (and incorrectly).
Being able to tell the difference between these two profiling techniques will not only help you understand your clientele better, but it will also give you an edge over those misinformed competitors who do not take their time to explore fully the unique benefits of each idea.
So now let’s get down to the nitty-gritty and start by explaining what “ICP” means.
ICP: Understanding your ideal customers
“ICP” stands for “Ideal Customer Profile”.
ICPs help profile and categorize different types of businesses. B2B companies, which offer services to other corporations, and their salespeople tend to use ICPs as a business-partner scouting method.
These profiles are based on cold hard facts: general information, statistical data, and firmographic intel. They include a detailed deconstruction of the main attributes that define your “perfect client”.
Unlike simpler terms, such as target customers (a term which only describes any company that might buy your product or service), ICPs focus on highlighting only the most valuable business stakeholders in the marketplace.
Developing ICPs
In order to develop a more complete ICP, most companies use data mining techniques, statistical analytics, and data quality software with ETL (Extract Transform and Load) tools.
ETL software can analyze, organize, and filter data extremely quickly. Thanks to the effectiveness of these tools, marketing specialists can develop ICPs more efficiently.
However, the automation and digitalization of this process come with a series of new and unique challenges when it comes to safety software protocols such as system monitoring, alerts, backups, and vulnerability testing.
No company wants to see this valuable and sensitive information being stolen, lost, or leaked.
Thankfully, cloud storage services offer a secure database that can categorize, organize, and contrast any data better than those old fashioned binders.
If you choose to use cloud storage, your information will not only be secure, but it will be better organized and easier to access by your marketing teams and sales reps, since most cloud storage apps give you the opportunity to retrieve documents from any device.
Understanding buyer personas
On the other hand, buyer personas can be used by both B2B and B2C companies, but they are mostly used by businesses selling to specific individuals.
Instead of being purely based on numbers and stats (like ICPs), buyer personas also include behavioral information, such as the customer’s buying habits, needs, and motivators.
Such information can come from diverse sources like analytics of your website metrics or even social media.
Since buyer personas are commonly used to profile individuals instead of companies, this profiling technique uses demographic info, instead of the firmographic intel used for ICPs.
By which we mean an individual’s gender, age, job title, etc. Buyer personas serve as a “fictional representation” of potential real clients.
Buyer personas: Understanding a typical customer
The term “buyer persona” was first used by American software designer Alan Cooper in the late 90s.
Cooper created this concept to help other fellow programmers develop more intuitive software applications (since back in the day most programs were very difficult to use and navigate).
With this in mind, he came up with a fictional client named Kathy, an average software user that was not particularly tech-savvy. This helped software designers understand how to adapt their product (in that particular case, computer software) for a specific type of client.
This is the essence of buyer personas. These profiles are used by marketers who want to get inside the heads of different types of buyers and their potential customer base in general.
All in order to promote their products or services and speed along the buying process.
Developing buyer personas
You can develop a more robust buyer persona by simply implementing customer journey data analysis.
This analysis helps companies like yours map your clients’ experience from start to finish, analyzing their preferences and habits.
This information can be used to develop new buyer personas.
Another approach to crafting buyer personas that uses the information you already have is found in Customer Relationship Management (CRM) software.
You can reverse-engineer buyer personas by simply implementing the information you have about your current clients and existing customers (gathered with CRM tools).
Instead of crafting “fictional” client profiles that might help you target specific types of customers, you can simply analyze your clients’ needs and habits to create buyer personas out of their profiles.
Automation and buyer personas
As previously mentioned, automation is the way to go if you want to build accurate, useful buyer personas quickly.
Most companies, including yours, can easily implement bots and automated processes to make the development of buyer personas easier and faster.
You can boost this process by using customer journey data and creating automated responses with the help of Robotic Process Automation (RPA).
This avant-garde approach offers many advantages:
- Greater accuracy and a more personalized approach for every client
- Cost-cutting techniques that do not require as much human interaction
- Improved customer experience during negotiations and after closing deals with customers
You should be investing in ICPs and buyer personas
Whether you are a business owner that runs a startup or small company or the CEO of an international corporation, you might be wondering whether buyer personas and ICPs can help you grow your business or not.
There’s nothing wrong with being skeptical, this is a reasonable doubt for those who have never tried profiling clients. The answer, however, is a resounding yes.
Let’s make something very clear before delving into which profiling technique would better fit your specific needs or interests.
Both big corporations and smaller, more modest businesses can benefit from adding ICPs and buyer personas to their marketing and sales strategies.
Spending that extra cash on a robust profiling strategy is the type of investment that ends up paying dividends and leading to a healthier bottom line.
Additionally, you can develop ICPs and buyer personas without having to waste enormous amounts of time and resources, too. Nowadays, a company can easily optimize its resources by using any of the small business apps on the market.
This little productivity boost is just what smaller companies need in order to start developing their own buyer personas and ICPs.
We understand that choosing the best productivity app may seem like a long and tedious process, but trust us when we tell you that it is a long-term investment that could launch businesses like yours into an all-time high level of success.
If you are dealing with budgetary restrictions that don’t let you implement ICPs or buyer personas, don’t despair. We have the perfect tip that will help you give your balance sheet a boost: upsell.
Put simply, upselling is making your current customers pay more for your services or products. It may seem like a quick way to lose customers, but there are many ways to upsell without losing clients.
If you are an ecommerce business, for example, you can upsell by simply shifting towards premium services that may entice clients to buy into your new offers: upgraded and personalized quality service.
If your business model is not purely Internet-based don’t worry, one quick way to give your company a digital presence is by learning how to host a virtual local community event.
ICPs or buyer personas?
With the budgetary talk out of the way, and supposing that you have followed our tips on upselling and productivity, let’s move on to the central point of our talk: “Which is better, ICPs or buyer personas?”. The real answer, as always, is full of nuance.
In reality, ICPs and buyer personas are so different that trying to compare them directly doesn’t help a lot. The real question should be which could benefit a specific business in a very specific moment in time.
To find the answer to that conundrum, companies must look at what type of clients they want to attract and what type of industry they are a part of.
The traditional demarcation
As we have mentioned before, ICPs accurately describe the type of company that you should be trying to sell to, and buyer personas are detailed representations of the “fictional profile” of a potential customer.
With this in mind, it should be obvious that ICPs are ideal for businesses that work in the B2B industry.
Companies that offer services or products to other corporations usually implement ICPs in order to find those clients that cost the least to acquire and are more likely to form a strong business relationship with them.
Buyer personas, however, are better suited for B2C and some B2B companies, and are more focused on understanding the needs, interests, and pain points of a specific individual, rather than a company.
ICPs are mostly used in order to scout the market and find who to target.
Buyer personas, on the other hand, are mostly developed in order to understand how to better communicate with the individual (whether that is a consumer or a decision-maker within a business), creating a stronger bond between the company and its client.
ICPs and buyer personas (how to do both)
Even though it has been made very clear that these profiling strategies are not the same, it is vital to point out that both techniques do not have to be entirely exclusive.
Companies looking to create a robust B2B link, for example, can use both ICPs and buyer personas.
In the Business to Business industry there is a simple yet effective slogan: “B2B is H2H” (meaning “human to human”). Developing a well-organized ICP will be useful in order to determine which company would make the best business partner.
Crafting a strong buyer persona, meanwhile, might help you sell your project to the individual people who must sign on the dotted line.
This two-step model (ICPs + buyer personas) can help you create stronger marketing strategies and shorter, more effective sales cycles.
Using ICPs first will help you choose ideal customers, creating personalized client profiles based on statistical or firmographic data.
Then, once both you and your ideal client have had the chance to get to know one another, it is useful to compare the statistical information gathered through your ICP with the customer’s personal habits and needs, to shape their buyer persona.
Additionally, you can strengthen your sales pitch and deal-closing abilities by implementing some neuromarketing into your ICPs and buyer personas.
The use of psychology to convert leads into customers, for example, is a great way to boost your sales.
Another way to turn leads into satisfied clients is by hosting your own webinar. These online events offer great marketing potential for B2B companies looking for exciting networking opportunities.
Since leads tend to have a pre-established interest in the services you provide, you use your ICPs and buyer personas to determine which leads would make the best customer.
Teamwork makes the dream work
Investing in different neuromarketing techniques and hosting your own online webinar are not the only ways to get more customers.
Having a well-organized sales team is another strategy that can help you use ICPs and buyer personas to close more deals.
To do so, it is essential to provide your sales department with state-of-the-art tools. You should start by investing in quality video calling apps.
These features make teamwork and communication easier, which helps your marketing and sales department work in conjunction in order to develop ICPs and buyer personas.
Additionally, there are many software programs and apps which provide various collaborative design tools that can help your marketing and sales department, as well as customer success and service teams which can offer valuable insights, develop fully-fledged ICPs and buyer personas in a collaborative way.
In order to successfully integrate ICPs and buyer personas, your marketing department, customer service, and sales teams will have to work in conjunction with one another.
However, that is no easy task: poor collaboration between different departments is one of the biggest roadblocks any company can face.
Most businesses fail at cooperation due to poorly managed teams that do not work well together.
Creating a collaborative culture from the get-go, encouraging feedback, and using compatible software are just some examples of easy tips to foster efficient inter-departmental collaboration.
Takeaway
Now that we have gone through every detail regarding ICPs and buyer personas, it’s time to group all the vital information that you came looking for.
In case that you need to refresh some concepts, here is a small recap:
- ICPs and buyer personas are two very different concepts.
- ICPs (Ideal Customer Profiles) are mostly used to identify the companies that it might be in your best interest to work with.
- ICPs are traditionally used in the B2B industry.
- ICPs are crafted by gathering firmographic data.
- Buyer personas are created to profile different types of potential clients.
- Buyer personas are built by using demographic data and tracking customer habits, which helps create a more detailed image of your potential clients.
- Buyer personas help companies convert leads and establish better relationships with clients.
- ICPs tend to be based on quantitative facts, while buyer personas are generally defined by qualitative/behavioral data.
- ICPs and buyer personas can be used simultaneously.
- You can create a two-step strategy by using ICPs first (to identify which client is your ideal match) and then implementing buyer personas (to get the deal closed and develop excellent customer service).
- All of these concepts can be easily applied both by B2B and B2C companies.
- Your marketing department, your sales team, and other stakeholders must work in conjunction when developing ICPs or buyer personas.
Now that you are well aware of the differences between each concept, it is time to use this newly found information to boost your prospecting and sales, develop strong marketing campaigns, and turn your business into the successful company it has the potential to be.
