Update Your ICP So Your Products Shine

We all know how crucial Ideal Customer Profiles (ICPs) are—they’re the bedrock of product positioning and effective marketing. Even so, the first question I ask when working with a new company is, “When was the last time you updated it?”

Chances are, a portion of your target segment has shifted in the last 6 months, meaning you might be investing time and money chasing the wrong accounts. Imagine if 15% were no longer the best fit—now, some of your sales and marketing efforts may be working against you.

What happens when your ICP is out of date:        

• Marketing guides the wrong buyer through the right funnel
• Sales invests extra time nurturing them
• Customer Success struggles to keep them happy
• Product builds the right features for the wrong customers

Eventually, customers churn and time is spent analyzing what went wrong.

Here are a few things to consider when updating your ideal nonprofit customer profile:

Shine a spotlight on your ICP and dim the rest

With 1.8 million nonprofits, it's critical to filter out the noise and only dedicate resources to the organizations that are the best fit. This isn’t to say you stop working with existing customers who are no longer a good match.

It means you don’t dedicate resources chasing after prospects who will never let you shine.?

Even if you had a magical product that was perfect for every nonprofit, you simply don't have the resources to effectively target and support them. Being selective helps you conserve your internal resources and make an impact where it matters most.

Why would some customers no longer be a best-fit??        

• Low ARR or lifetime value?
• Takes a lot of support time
• Low retention. High churn
• Expensive to acquire
• Misalignment of product expectations?
• Market saturation

Define the attributes of your best-fit customers

Positioning expert April Dunford nailed it in her book Obviously Awesome: focus on identifying the attributes of your existing customers who already love your product and make the best customers.

Identify the traits of an account that deeply values what you uniquely offer by asking, “What makes a target account genuinely care about the specific value we deliver?”?

For example, an ideal customer of a donor CRM built for small nonprofits may really care about the following:

• Built-in email automation
• Modern templates for donation pages
• Workflows that streamline gift acknowledgment

Who is not a prospect? If sales encounters an organization focused on improving their major donor program and requires sophisticated moves management, they’re probably not a good fit.

Report on performance by revenue and nonprofit segment?

Tracking the attributes mentioned can be challenging, so it's crucial to cross-reference your revenue KPIs with key nonprofit indicators.

Here are common KPI's to include: Given common data hygiene issues, these reports may be more directional than exact.

Here's a fictional report as an example:

Takeaways?from Example Report:

• Retention is poor for nonprofits and associations under $3M in annual revenue.
• While associations $3M-$10M have excellent retention, there’s little green space with 42% market share already captured.?
• The sweet spot seems to be nonprofits over $10M and associations $10M-$50M.

Get buy-in from leadership

Your reporting will highlight crucial questions and drive key strategic decisions. Keep the group small and include 3-5 leaders from different teams. They’ll need to get their teams behind any changes, so buy-in is a must!

Over the years, I’ve seen a few things get in the way of executing ICP updates:        

• Analysis paralysis, or difficulty running reports
• Unclear ownership of the process (it should be marketing)
• Using the wrong nonprofit industry data
• Time

Make changes and enable teams

Let’s say a decision was made to stop pursuing nonprofits under $3M in revenue due to low retention and high support costs, here are a few steps each team should take:

1. Marketing: Update positioning, messaging, ads, lead scoring, and segmentation. Partner with sales enablement to train teams.
2. Sales: Realign territories, quotas and named accounts. Fun!
3. RevOps: Revise reporting, territories and forecasting.
4. Product: Reprioritize roadmap.

In terms of enablement, you’ll need to reinforce this change for the next 6 months on team calls and all hands calls.

Ensure everyone understands the reasons behind the change and your company’s commitment to serve existing non-ICP customers with excellence.

Summary: An Ideal Customer Profile is essential for effective marketing and product positioning, yet many companies fail to update it regularly. If your ICP is out of date, marketing and sales can end up chasing the wrong customers. Regular ICP reviews ensure your resources are spent on accounts that drive brilliant growth.

Jnet Marketing helps nonprofit tech companies show the brilliance of their products through product marketing, GTM readiness and lead generation.