How to Create Your Ideal Customer Profile (ICP)

Struggling to attract the right customers? You might be targeting the wrong ones. In this video, Steve walks you through how to identify your Ideal Customer Profile (ICP)—the people most likely to buy, stay loyal, and help your business grow.

You’ll learn how to spot your best-fit customers, build accurate personas, and use data to fine-tune your marketing. With real-world examples and practical tips, this is your go-to guide for targeting smarter, selling more effectively, and creating long-term customer relationships.

TRANSCRIPT:

Do you want to be more effective with sales in your organization? Do you want to see that top line grow? Do you want to increase your profitability? Well, the one way to do this and to be more effective out there in the marketplace is to clearly identify your ideal customer profile, also known as your ICP. In this video, I'm going to walk you through the steps to identifying your ideal customer profile so you can create a lot more clarity, alignment, and drive better results within your organization. Specifically in the areas of sales and marketing.

I'm going to draw a bullseye here. This circle right here represents the core ICP of your business, right? This is your ICP. This customer right here is someone who understands your value proposition and they're willing to pay for it.

That's very important to understand. Somebody could understand your value proposition. It could be very clear, but they're not willing to pay for it. Or somebody may have the money and the means to buy your products and services, but they just don't get the value prop. Remember, when value exceeds price, customers buy. When price exceeds value, customers don't buy.

So at the core here of every business, we have this ICP, ideal customer profile. Like I said, they understand your value prop. They're willing to pay for it. You're solving this pain point. And outside of the ICP, we have a series of additional rings.

Here's the problem that I see. If your company has multiple ICPs, if you're trying to chase after too many different types of customers, then you'll find yourself marketing to this customer, to this customer, to this customer, to this customer outside of your ICP. And what can happen is this core can shift to the outer ring. And next thing you know, your business can get into a lot of trouble.

I've seen this happen over and over again. You don't want this to happen in your company. How does this happen? The reason why this happens is because organizations lack clarity with their market focus and position.

And when you don't understand your ideal customer profile, it's really easy to shift and move all over the place and not have a very clear market focus and position. And therefore you're trying to serve all these customers oftentimes out of desperation because you need to grow the top line. You need to hit sales targets. So you become desperate.

But the problem is, is guess what? See this customer out here? This customer is not your ideal customer profile. Maybe they're willing to buy your services, but they're a pain in the butt to deal with, right? They call you on weekends. They're really difficult. They're always asking for discounts or credits. They're late. They just, they complain all the time. They're just, they're not super enjoyable to deal with.

So when you have these customers and you start going after them out of desperation, guess what? This customer is going to tell his or her friend, her friends about your business. And next thing you know, because remember people hang out with like-minded people. They're going to tell other friends about how you discounted their products and services so these customers are going to expect the same. They're going to have all this negativity. They're going to bring this to your business and your ICP, your core is going to shift and you're going to find yourself dealing with a different customer set that you don't want to be dealing with.

So you have to be very careful and you have to be very disciplined about this ICP. Now look, not everybody is going to fit perfectly in this bullseye. I get that, all right? But let me walk you through the four things you need to clearly identify in your business in order to define a great ICP.

All right, you ready for this? Now, every person out there, this is my person right here. Draw some arms on them. This is a person who is trying to make progress. They're trying to make progress towards some type of goal.

And you may wonder, well, why are they trying to make progress? Why do we all make progress? We want to make progress because we feel pain or maybe we have goals or maybe there are other types of triggers that occur where we say, look, I don't want to be in this state anymore. Like, it's so painful. It's such a struggle. Like, I don't like it. I need to move. I need to get moving. I need to move to another position.

And therefore, when we feel enough pain or there are constant triggers, which I'll get into here in a second, then we want to move forward and we want to make progress. The same thing is true with our goals. Think about it.

If I want to run a marathon and I have this goal, I'm going to go out there and buy running shoes. I may buy some supplements. I may join a gym. I may hire a running coach. All these things that I invest in, these products and services are there to help me to achieve my goal, to make progress.

For triggers, let's say you're a financial advisor. Well, some triggers of your ideal customer profile may include somebody buying a new home, having a baby. Maybe there's a liquidity event in their life, such as they sell their business or they get some inheritance. But there's some type of trigger that is causing these individuals to say, hey, look, I need help. Like I'm out of my comfort zone. I need to hire a financial advisor.

The same thing applies to so many different situations, but that's what we have to identify. These pain points, these goals, these triggers, all these items that make up a customer's motivations and circumstances. So this is number one. This is the first thing you need to get super clear on.

Now, one of the biggest mistakes that individuals make in companies or leaders make is that they believe they need to start with demographics. So they start identifying their customer based on their age or their geography or whatever it may be. That could be helpful, but most people don't buy based on demographics.

I mean, when's the last time you bought a product because you were 35 to 45 years old, you had a one and a half bedroom house with 2.5 dogs and 1.6 kids. It doesn't happen. We buy based on our pain points, our goals and our triggers.

So sure, you could identify some of those things, but the main thing is you want to focus on these pain points, right? So the person is trying to make progress and they wanna get to this dream outcome. All right, so going back to the running example, I wanna qualify for the Boston Marathon. Let's say that's my goal. That's my dream outcome is to qualify.

I wanna get there because I have needs, wants, and this urgent problem to solve. And this is number two. This is what you need to identify up here is the dream outcome that your ideal customer profile is trying to achieve, right? So when you identify their needs, wants an urgent problem, then you're on your way.

But when does that ever happen? I mean, when do we ever set goals or have pain points and we take action and it just works out perfectly? Okay, sometimes it does maybe, but oftentimes what happens is in the way we run into these obstacles, right? So these obstacles get in the way and I'll just draw this like giant wall. So on one side, we're right here and this is like our treasure chest, right? Of whatever it is.

But this is our goal that we wanna get to, but we have this obstacle that stands in our way of achieving our dream outcome. And this is where we have to be very clear in the process about the problems they will encounter, the timeframe they can expect to achieve this in the level of effort and sacrifice required to get over this obstacle to the dream outcome.

And when we can get very clear on these items and we craft our offers based on this language, then we're gonna drive so much more value to the end user.

Think about it. Let's say I'm a personal trainer and I have this program and I say to you, I have a 12-month program that you could join and it's $99 and after 12 months, you'll get six-pack abs. You only have to work out one hour a day and then you'll achieve the six-pack ab dream outcome. Or I have another product where I say, look, just in 10 minutes a day for three months, you just have to put in this effort and for $599, you'll get six-pack abs.

Well, somebody would be willing to pay probably $599 a lot faster than the $99 offer because they're gonna get there in a shorter timeframe with a lot less effort. So when you start touching on these things, the less effort your ideal customer profile has to go through in order to get to the dream outcome and the less sacrifice they have to make, right?

Like if you could say, hey, I'll get you six-pack abs without changing anything with your diet, okay? Now, if there is some magical solution like that, let me know, but you get what I'm saying. The less sacrifice they have to make, the less effort they have to put in and the faster the timeframe is to overcome this obstacle, the more valuable the offer is gonna be.

So the $99 over 12 months, you may think that's the better option because it's cheaper, it's more affordable. However, the more expensive option is actually of more value because remember, there's more perceived value compared to the price. You're gonna get six-pack abs in three months compared to 12 months and a lot less time.

So that's why it's important to understand the obstacles they'll run into and then clearly identify the problems, the timeframe, the effort, the sacrifice, and all these things related to those obstacles, right? So this is number three, super important.

Now, it would be great if we could just stop here at number three, but guess what? There's these macro trends that happen and this is number four, that get us away above and beyond these obstacles. So these obstacles are more related to the ideal customer profile. Oftentimes they're in their control.

However, these macro trends, you have like inflation, you have unemployment, you have the economy, you may have other regulation, you may have market disruption. All of these items are occurring on a macro level that are gonna impede this ideal customer profile from achieving the result.

So you have to understand what these trends are. What are the big things that are getting in the way of the customer above and beyond the obstacles of getting to their dream outcome, all right? So when you could clearly identify what these are, including stats in their space. So what are some statistics in their space? What's the old way versus the new way of doing this?

When you can clearly identify what those are, then you are gonna be so much closer to getting them ultimately to this promised land. And this is where you have, maybe I'll draw this giant rainbow here, this beautiful rainbow place. It's a terrible rainbow because the colors don't even match the colors of a rainbow but I think you get the point.

We'll make some stars here. Yay, such a wonderful place to arrive at. And this is where we wanna get our customers.

And if we can clearly identify that, let's go back through this. If we could identify the motivations and circumstances, number one, the dream outcome that they're trying to get to but the obstacles that they're gonna run into along the way and then number four, the macro trends that are gonna prevent them from getting here.

When we could identify them and when we get in their head and we start saying the things that they're already thinking in our messaging, in our marketing, in our sales, in our offers and when we lead our sales and marketing with empathy, right here, that's the key.

When we lead with empathy, we are going to have customers that are raving fans. We're gonna deliver exceptional value and very unique experiences for them and that's gonna drive greater value for our organizations. When we create value for customers, we capture value as an organization.

So that's what I wanted to walk you through today. Go through these four steps in your company, identify these very clearly and remember, just focus on one ICP. Focus on this bullseye here.

Sure, some customers outside of the bullseye are gonna come to you. They may even buy your products and services but when you make choices, strategic choices and you make trade-offs, more importantly, about who you're gonna serve and who you're not gonna serve, you're gonna just strengthen this ICP and this bullseye and you'll remain true to your strategy and you'll be so much more successful in business.

I wish I would've learned this much earlier on in my career. I would've avoided a lot of mistakes. What about for you? Who is your ideal customer profile? Drop that down below in the comments box.

I wanna hear from you because I wanna understand who your ideal customer profile is. I love engagement and also you can provide feedback as well down below so I know what type of content you're looking for so I can make this channel even more valuable for people like you.

Don't forget to subscribe so you get notified every time I drop a new video like this in the future and in the meantime, take care of yourself. Cheers.