You need to know your product-market fit (PMF) and ideal customer profile (ICP) because your sales agents simply cannot target, market and sell tech to new accounts if they don’t categorically know who those customers are, or whether you have the best-fit product for them.
Prioritize a pipeline of closely-matched prospects rather than concentrating on just increasing numbers, particularly when scaling up to new markets in new territories. B2B tech business is fast and competitive, especially in Europe, and knowing your product-market fit and identifying your ideal customer profile are one of your earliest and most important tasks.
A target-less and sweeping one-size-fits-all approach to find the ideal buyers just doesn't work.
Who is your best product market fit and how do you identify your ideal customer profile?
If you build it, they will come. There are methods and parameters to learn and follow in order to know your product-market fit and efficiently build your ideal customer profile. Let’s take a closer look.
What is product-market fit? It’s exactly the moment when your service or product exactly addresses the requirements of your customers, and acts as the best solution for them.
Product market fit is equal to:
Simply, PMF is the capability of a market to support your business, and the ability of your product or service to meet that market’s requirements.
How do you imagine product-market fit? Your end goal will always be to manufacture such a perfect product or solution service that customers think is just for them. They feel they need, and have, a bespoke experience. Then, all going to plan, those same customers become an extension of your international sales representatives, and act as advocates for your brand. Therefore, as our partners at HubSpot advise in this article, every business should deeply care about understanding and achieving product market fit.
Yes, product-market fit is important because it adds value. But first you have to research it. The best way to do this is to find out what buyers need. Send surveys to existing customers and find out exactly how valued your product or service is to them. How much do they really need what you are selling and what value do they put on it? Ask a variety of pointed and open-ended questions to obtain the best and honest answers.
This, of course, may change according to demographic and location, as trends are subject to change from country to country.
As you learn more from the replies, you will also learn more about your own business. Knowing your product’s value means you will need to be prepared to perhaps be more flexible and reshape to fit. You may look at your business in a different way, and with the confidence of good market fit achieve growth capital from investors and maybe even decide to scale-up into new territory. An efficient way to do this is by the use of sales outsourcing, allowing you to experiment with numbers until you get it right. Partnering with an outsourced sales agency will give you the options to build out your sales team, or ramp up your B2B lead generation and marketing team. Outsourcing is a great fit for SaaS, and recovery from the pandemic shows a promising path for SaaS companies in Europe and for accelerated venture investment.
Remember that your ICP is not the same as a buyer persona. The names you will gather, the ones in charge of decisions or the ones who hold the company purse strings are not your ICPs, but their companies are.
The names you will approach are the buyer personas, and they are important as they’re the people that the sales team will approach, but only in the following stage of the sale cycle.
For now, your ideal customer profile is the type of company that will stand to gain the most from your product or service, and not the individual you have to convince.
Questions to ask yourself in order to determine your ideal customer profile include:
Essentially, you want to narrow prospective companies down into a good fit funnel that streamlines your selling process. Look back and see what worked well in your home turf.
But, perhaps you’re overly cautious about this? What if, by streamlining, you’re turning away customers or disregarding them because they don’t look like a good match on paper? That’s something you will have to push through on. It’s necessary, in order to be completely clear on the characteristics of your ideal customer profile. And, remember that it’s possible to build more than one ICP once you have saturated your initial markets, but not too many, otherwise you are back to marketing for anyone and everyone, and this defeats the objective.
All of this may seem like a convoluted and thorough road to selling, but it’s also imperative that you get it right. After all, you could theoretically just sell, sell, sell. Approach and sell to any loose-fit company that can afford your product or service. But then maybe they don’t really need it. That makes your product and the buyer a false-fit, and that can be damaging to your reputation and brand. HIgh churn rates to companies that are not a great fit for your product or service leads to negative feedback. Scaling into new markets means keeping a good reputation intact.
Knowing your ICP means smoother sales cycles, faster. You’ll engage with companies and build strong relationships with them for repeat business, brand loyalty, and gain a good local brand reputation. All of this actually saves you time, money and creates long term value.
A good product-market fit and an ideal customer profile will never be 100% perfect, or tick all the boxes all of the time. You and your team, and any partners you choose to work with, like an outsourced sales agency, must sit down together and work out the most important characteristics of an ICP. Get as close to the mark, and the market, as possible. Once that is accomplished, and revisited time and again to tighten it up, then you will always be ready to prioritise target accounts.
And don’t forget, as your product evolves and expands to new countries, use cases and your PMF and ICP will change. That’s OK. This should be a conversation that you revisit every couple months, especially when heading to previously uncharted waters.