When you target your core and engage with them the right way, that’s when win rates go up, stage progression accelerates, sales cycles go faster, and deal sizes increase. When you align with your core, you build retention, you drive customer lifetime value, and expand deals as you provide greater value to them.
But, very few GTM teams align with their core.
They do not even know what their core is as they only defined their Total Relevant Market and not their ICP. Most ICP definitions miss the “ideal” and cast far too wide a net, targeting broad industries and revenue ranges without getting granular enough to define the “ideal” customers.
DAT Freight and Logistics Did Not Have a Well-Defined ICP and It Led to Lower Win Rates and High Churn…
Before investing in our ICP management program and ABM readiness program, DAT defined their ICP by industry and freight spend.
They weren’t segmenting their existing customers to uncover their “best fit” and identify characteristics of those high-value accounts that were using their platform on a regular basis (making it a must-have) vs. monthly, quarterly, or yearly basis (making it a nice to have.) They weren’t looking into how and why the DAT platform was being integrated into the daily programs of the most frequent users and how they were utilizing the platform differently than the others.
They didn’t look into the characteristics of the accounts that would need freight rate analytics at the component level making their lower-cost competitors and suites like E2Open that are offering the analytics for free irrelevant as they do not offer analytics at the component level. Within the win/loss analysis we completed, we saw that DAT Freight and Analytics lost deals to Uber Freight, E2Open and Freightwaves because their costs are 2-4X lower and the analytics are “good enough,” They weren’t focusing on the accounts where it would not be good enough to have lower quality analytics that did not even have it at the component level.
They didn’t look into supply chain maturity.
If DAT targets accounts with a level 1 or 2 maturity, they will automatically be seen as a nice to have because all of the teams are siloed. They would not be able to look beyond the “transportation management role” and “cost savings.” They would not realize the full value and returns from their investment in DAT which should touch the complete supply chain, distribution, finance, sales/marketing and operations organization. The level 1 and level 2 maturity accounts are the ones that would find the rate analytics of DAT’s competitors good enough. If they did move forward with DAT, they ultimately churn because the returns are not strong enough at DAT’s investment level to only be used for rate benchmarking.
Because DAT did not target the right accounts and they focused on their total relevant market vs. their true ICP, their enterprise win rates were low and their churn rates were high. As their ICP was not defining the accounts that would land, stay and expand with the company, they weren’t increasing their customer lifetime value and not driving the NRR growth that leadership wanted.
How and Why GTM Teams Only Define Their Total Relevant Market vs. Their ICP
Most ICPs suck as GTM teams do not dig deep enough so that the ICP is predictive of the accounts that will most likely move forward and deliver the greatest revenue growth in the long term. As a result, GTM teams are always guessing who to talk to next.
Teams are too focused on demographics and technographics vs. getting a better understanding of their existing customers to identify the common characteristics of their greatest wins. Teams are still giving the same old description of their ICP – and it’s about industries, geographies and the size of the companies. 6sense, Demandbase and other intent and ABM platforms are part of the cause for companies to confuse the total relevant market or serviceable addressable market with ICP. They are allowing their customers to think that the proxies and surface characteristics inside their platforms is how you define your ICP and they are not educating their customers on the additional signals and insights that are needed to truly identify the ideal customer profile.
As Jonathan Spier (CEO of Rev) mentioned on the ABM Done Right Podcast…
“You don’t want the company that looks right with surface characteristics that ABM and intent data platforms show – you want the ones that will go all the way through the funnel, sign the deal and become happy customers that stay and grow with you. There are signals that should form your ICP that are more predictive of sales success than technographics, surface characteristics and intent data.”
Click the image below to listen to the podcast episode with Jonathan Spier:
As we were telling Todd Abbott at Delivr.ai (a person-based intent platform)… While he and others think they’re focused on the ICP or the ideal account profile, they only look at the superficial outside characteristics of the company. They don’t go deep enough to see if a company aligns operationally, executionally and culturally to adopt your solution, get the most value from it and stay with you for a long time. Because GTM teams do not dig deep enough, most ICPs are nothing more than a total relevant market as the ICP should be much more nuanced than the set of proxies that can be found in 6sense, Demandbase and other ABM and intent data platforms.
Because accounts may look the same on the outside (selling similar solutions, similar revenue numbers, similar employee size, similar technologies used etc.) — it doesn’t mean that the companies are look alikes on the inside. Two similar accounts can be two worlds apart when it comes to their execution, operations, philosophies and culture. They can be two worlds apart on how they buy. The buying group personalities may be completely different.
As Scott Martinis posted on LinkedIn….
How Pure Storage is Going Beyond Total Relevant Market Proxies and Defining Their ICP…
Fabiana Carpio Brunetti at Pure Storage mentioned on the Let’s Talk ABM Podcast that she’s going beyond the typical proxies to define their ICP. She’s looking for…
- A strategic fit — At Personal ABM, we make sure that our clients’ ICPs align with them operationally, executionally and culturally. We want to make sure that accounts not only land but they expand. So, we want to make sure their ICP accounts match the operational characteristics of the accounts that are getting the most value and are delivering the greatest long-term revenue growth. Too many customer acquisition transactions are based on initial contract value and not on are the customers going to stick around.
- True displays of operational readiness – Too many teams focus on accounts that are “looking” for alternatives – mostly to do their due diligence. But, they are not operationally ready nor have the culture for change. These accounts become indecisive and stay in the status quo. It’s important we do not waste sales and marketing resources on accounts that are not displaying readiness.
- Has the right revenue potential – As Nancy Carlyle Harlan (former UIPath ABM leader) mentioned on the ABM Done Right Podcast — ABM is about delivering the greatest revenue streams possible YoY with future and existing customers. It’s not about the next deal.
- Exhibits the right engagement opportunity. They are not looking at how buyers engaged with their most valuable wins and matching it to the engagement of their supposedly ICP accounts. They are not looking at the personas that engaged and when they engaged and matching it to their ICP accounts.
- Has the right profile and influence potential – Most people are not looking at the personalities of the buying group. They are not looking to see if there’s a potential champion that will help bring the teams together to win the deal — and to expand the deal.
Now, It’s Not Enough to Just Define the ICP – You Want the Winnable, Accessible Market Segment of Your ICP
Your winnable, accessible market (WAM) matches your ICP, they do not have your anti-ICP characteristics and…
- They have an active, strategic priority that you can play a strong role in.
- They are facing a situation where you have a differentiated, situational story to tell vs. an industry or persona story. As the “Challenger Sale” book mentions, “It’s not that buyers do not believe your story. It’s that they do not see themselves inside the story that’s being told.
- They match your business problem profile
- They have an ideal vendor profile that matches your company.
Click the podcast image below to learn more about identifying your winnable accessible market.
Your Next Steps…Improve Your Aim, Build a Predictive Pipeline and Win with ICP Management Services.
Click here to learn more about our ICP management services, or book a call below to discuss how you can refine and more effectively orchestrate your ICP across your GTM organization.