How To Create An Ideal Customer Profile To Grow Your SaaS Business
July 28, 2022 Edwin Kooistra
A 2021 Gartner research identified that the SaaS industry has grown to a phenomenal $172 billion, experiencing 500% growth over the last 7 years. However, it also increased competition over the years, with the US alone hosting almost 17000 SaaS businesses.
In 2022, SaaS businesses require definitive branding to differentiate while highlighting their competitive edge over the industry. So how does one differentiate a digital offering in a highly competitive environment?
The answer to this question is to build an ideal customer profile (ICP), a fictional personality of your perfect customer. An ideal customer persona is usually the foundation over which SaaS businesses build the tone, language, design, branding, and marketing of their offering.
The most critical reason to create an ideal ICP for your SaaS company is that 67% of customers now expect higher quality from cloud-based service providers, as they expect both flexibility and agility for work processes.
4 Factors You Should Include to Create an Ideal Customer Profile
A customer profile may be an imaginary personality, however, it reflect the real-life behaviors and characteristics of real people. For SaaS businesses it is essential to identify the ideal customer within popular profiles.
To understand the ideal customer profile for a B2B SaaS business, here are 4 important factors you should consider for a more precise persona.
- Know Your Customer Needs
- Learn your Customer’s Pain Points
- Know Your Prospect’s Customer Journey
- Communicate with the Person who makes Decisions
1 – Know Your Customer Needs
The first factor is to identify exactly what needs your SaaS business fulfills or what issue(s) it resolves for customers. Marketing departments can find excellent insights to create appealing content, introducing their brand as a viable solution.
Here is an excellent sample of an ideal customer profile template to help you identify a better audience for your SaaS business.
Research has identified that it’s four times more costly to onboard a new B2B SaaS customer, compared to retaining older ones. The ideal source to identify your perfect customer profile is your existing customer.
Requesting customer feedback, monitoring digital metrics like blog traffic, ad engagement, and conducting surveys can all identify considerable insights about the general interests, buying behaviors, characteristics and demographics of your ideal B2B customer profiles.
2 – Learn your Customer’s Pain Points
Every customer has a pain point that they may not even have identified, yet, hence it is essential to learn about the challenges your customers are facing. The SaaS audience is generally looking for flexibility, agility, and efficiency packaged into a single service.
Once you have identified that audiences want to enhance productivity, increase comfort, convenience, solve a technical issue, or all of the above. Then marketing teams can focus on strategies to generate demand for a product, which will raise the brand awareness of a product to attract the perfect customer.
A great deal of emphasis should also be placed on the buyer’s journey for SaaS B2B customers, allowing them easy onboarding. The productivity, convenience, and comfort feeling should begin with the subscription process and not later on.
3 – Know Your Prospect’s Customer Journey
It is crucial for SaaS businesses to maintain strict focus on their audiences’ buyer journeys, especially if they will move to a competing brand very quickly. Since it’s usually subscription based, cloud application service providers need to nurture their customers through highly managed marketing funnels.
Creating the ideal customer profile for B2B SaaS requires clear segmentation to place audiences in the right stage of the sales funnel. By segmenting the audience in accordance to the stages of the sales funnel, you can clearly identify when customers are ready to convert.
4 – Communicate with the Person who makes Decisions
To identify customer profiles, it’s generally a good practice to connect directly with decision makers who give the final verdict. The CFOs, COOs, CIOs, growth managers, and CEOs of today all require agility from AI based cloud solutions, while enhancing the motivation and well-being of their workers concurrently.
6 Steps to an Ideal Customer Profile for your B2B SaaS
Now that we know all the important factors to consider when creating a B2B persona, let’s go ahead and learn about the 6 essential steps to identify perfect customer profiles:
- Analyze Your Existing Customers
- Conduct Survey of your Current customers
- Successful Cases Studies
- Filtering Leads through Pre-qualification Processes
- Identify Similar Attributes amongst Your Customers
- Find Common Firmographic Attributes
1 – Analyze Your Existing Customers
To get things started it’s a great idea to access locally held customer data to analyze your existing customers to develop ideal audience profiles. Important indicators including user demographics, business size, number of employees, services subscribed, and frequency of use, can identify several segments in existing customer databases.
SaaS businesses can now identify audiences that are their best or most engaged customers. Once the perfect customers have been identified it is time to conduct interviews and surveys to learn more about their needs, demands, and request feedback.
2 – Conduct Survey of your Current customers
By interviewing and surveying existing customers, SaaS businesses can easily pinpoint major factors that constitute a perfect buyer persona for their services. Businesses must answer crucial questions from the responses of these interviews, for example:
- What benefits does our product offer customers on a daily basis?
- How much does our best customer pay us in subscriptions?
- What value do customers derive from our product?
- What is the ROI of our product to our top customers?
- Where do customers think we need to improve our product?
3 – Successful Cases Studies
Our third step in the pursuit of identifying an ideal audience persona for SaaS is to research successful case studies. One of the best ways to identify relevant customer profiles is to look into successful cases where businesses have not only benefited from your SaaS services, but also grown revenue.
Understanding how your existing successful and profitable customers utilize the SaaS service provides real time insights about service benefits, customer budgets, profitability, and other important demographics.
4 – Filtering Leads through Pre-qualification Processes
Identifying a perfect customer can be a complex effort for the entire team, therefore it is ideal that many SaaS providers develop pre-qualification processes in their forms, interviews and surveys.
Professionals agree that having pre-qualified leads shortens conversions times, engages audiences from diverse geographical regions, and assists in developing perfect customer profiles.
5 – Identify Similar Attributes amongst Your Customers
Comparing your interviews, survey, database, and prequalification research data it is now time to find the similarities in your existing customer segments.
There can be several aspects like budgets, number of employees, scope of operations, geographical locations & offices etc. that can be identified by simply comparing your existing customer insights with your external research.
Remember not to clutter your process with a huge number of attributes. Consider 5 to 10 critical attributes that define your best customers.
6 – Find Common Firmographic Attributes
Filmographics are the “firm demographics” of your best customers, so in essence they describe the size, financial budgets, and other intrinsic characteristics of your existing clients. By comparing these SaaS businesses can instantly begin to create a perfect profile of qualified customers.
The following are some of the most common yet unique features:
There are some filmographic attributes that are generally the same among most of your bet customers. These factors usually include:
- Size of Business
- Geographical Location
- Business Maturity
- Number of Customers
Other Positive Outcomes Of Creating A Successful ICP Framework
Once all necessary attributes have been compared, and all insights have been analyzed, it’s time to give shape to your buyer persona template that will define the customers who will subscribe to your SaaS services.
Personified by a fictional organization name, the persona should be given a clear & concise description that defines its mission, values, challenges, budgets, and opportunities. The personas can either be separated in accordance to metrics like size of company, or all customers can be placed in one category.
SaaS businesses are a growing industry, however it is essential for these businesses to identify their best customers through profiling. By developing ideal customer profiles, SaaS businesses have the opportunity to enhance conversions, revenues, and brand loyalty.
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