Is your pipeline filled with ICP?

ICP = Ideal Customer Profile – the companies most likely to purchase from you, that will get the best value and remain with you. Everyone should be clear what their ICP is (and acknowledge that it will change with time).

In order to deliver effective sales, focused marketing and efficient postsales support, the narrower your ICP the better. It needs to be large enough to comfortably provide the revenue needed for the relevant planning horizon (next year, next two years), but no bigger. Even if you can sell to everyone, don’t. You will be more efficient selling to a subset and expanding to adjacent markets in the next cycle.

So, definitions aside, do you have an ICP? I bet you will say yes. You might even be able to articulate it concisely. And if you are one of the lucky few, you might find that your entire organisation is lined up behind it. Although that would be quite unusual!

Please read that again. 18%. Less than one fifth of the value of the pipeline is meeting the criteria for your ideal customer profile. Perhaps it’s deals with companies which are close to, but not quite ICP. Some opportunities just seem to good to be true, so we don’t ignore them. Opportunities that have hit the pipeline without anybody thinking carefully about whether we should be selling to them. After all, saying “no” to a prospect is hard.

I can live with it if a few non-ICP customers are in the pipeline, being managed with clear visibility and understanding that they are there for a specific reason. 20% of pipeline? 25%? I’d even live with 35%. But every time you do this, you are reducing focus, reducing the chance of winning, increasing the cost to acquire, and increasing the cost to serve.

Get brutal. Decide what your ICP is. Remember: it must be big enough to achieve your revenue goals. Then, make absolutely sure that everyone gets it. Sales, marketing, engineering, product, postsales, finance, operations. Everyone should know who they are building for, who they are selling to and who they are servicing. And then go through the pipeline and kill non-ICP deals. Keep in a small number where there is a really convincing reason – make sure that decision is being made higher up the tree, don’t let AEs decide.

The pipeline will look very skinny straight after this. Everyone will be scared. You then need to build the right pipeline, the deals that will all close, which will increase your efficiency, and improve your revenue. BE BOLD.