The common business adage goes that if you target everyone, you end up targeting no one. Creating an ideal customer profile (ICP) is all about honing in on a very specific person. This person, or the representation of them, isn’t a made-up dream customer. They’re ideal because they’re the person who most needs what you’re bringing to the table, is most willing to pay for it, and requires the least effort compared to the value that they bring. If you can sell to them, your product gets closer to selling itself—and that’s the dream when you’re on the path to achieving product-market fit. In this guide to building your ideal customer profile, we'll cover:Why this exercise to build an ICP is worthwhile, and how having one can help youThe difference between an ICP and a customer or buyer persona The importance of an ideal customer profileUnderstanding who your ideal customers are is key to achieving product-market fit, but there are other benefits too: Lowers your customer acquisition cost (CAC) by spending fewer resources on the wrong kinds of leads Reduces customer churn  Drives alignment across your company among different teams Helps to focus your messaging and marketing efforts Streamlines various business activities such as account management and content creation especially in conjunction with customer personas Ideal customer profile vs. customer personaHow is an ideal customer profile different from a customer persona (or buyer personas)? Customer personas are fictional archetypes of people who may use your products. Understanding who they are will help you design a product that is considerate of a range of behaviors, attitudes, motivations, and traits from a wide spectrum of potential customers. On the other hand, your ideal customer profile is the one specific single group of customers that you most want to reach. Think of them as your primary target market and your customer personas as all your possible target markets. You could have anywhere from two to up to five different customer personas, whereas you’d only have one ideal customer profile (although the quantifiers of your ideal customer profile could include ranges i.e. a B2B business with 10 to 50 employees). Customer personas are also typically more focused on telling the story about your customers to act as an aid for marketing and sales teams, while ideal customer profiles are typically more focused on statistical data to help identify who those customers are.Depending on who you ask, some say that customer personas are for both B2B and B2C businesses, while ideal customer profiles are typically for B2B businesses. This separation is due to the fact that customer personas are often focused on the individual—their thoughts, feelings, demographics—whereas ideal customer profiles are focused on data points such as company size, annual revenue, and budget. However, you can and should have both regardless of what kind of business you run.While they’re similar and sometimes overlapping, it’s important to have a sense of who your perfect customer is as well as the people who contribute to the growth of your business overall. Your perfect customers may be the most vocal advocates of your product and drive most organic growth but only make up 20 percent of revenue, as an example. In any case, you should have a way to identify your customers (ICP) as well as a way to understand them (persona). To summarize: Customer profiles usually come before customer personas in the product development phase, whereas customer personas are created often by marketing, sales, or design teams based on customer profiles Customer profiles are based on research and data, customer personas expand on that with fictionalized details Customer profiles are typically done for B2B, customer personas are for both B2B and B2C businesses  You’ll have one single customer profile, but may have up to five customer personas For now, let’s focus on creating a profile of your ideal customer, the driving force of product-market fit.How to create your ideal customer profileStep 1. Identify your ideal customerWith the data that you’ve collected from customer research, you now have some idea of who the best customers for your business are. However, “best” may not be clear. The most positive response may not necessarily be the response that felt most positive. Instead, look for signs of need and desire, that you’re solving a problem they can’t wait to pay for. This could come through qualitative data (surveys) or quantitative data (high conversion rates compared to other customer segments). If you have existing sales data, this is most often customers who have/are: High monthly recurring revenue High lifetime value Low hassle Who are these people? Do you have insights on why they’re using your product and value it? If not, you’ll want to conduct customer interviews and collect feedback so that you have a clear sense that they are in fact your ideal customer and why they’ve chosen your product.Step 2. Gather your dataOnce you’ve identified your ideal customer, you need to dig in to understand who they are based on the commonalities that they tend to share. Here are some attributes to consider:Demographic Age Location Gender Job  Income/Revenue Education level Family status Company size Industry Psychographic Lifestyle Goals Challenges Habits Values Interests  Hobbies List anything else that stands out that you notice your ideal customers have in common. Step 3. Create an ideal customer profile documentYour ideal customer profile should fit onto a one-page document. You can find templates online but it’s simple enough to put together. Use the data you’ve compiled based on the commonalities of your ideal customer. Aside from key demographic and psychographic data, you can also include a couple of behaviors and insights you’ve learned from your customer research that paint a picture of their relationship with your product’s value proposition. This could include things like: Key pain points Goals and objectives Insights into their decision-making process You don’t need to include every single detail you uncover. 5-10 attributes is enough to get a clear picture of who they are. Remember, you’re going to use this document to help you (and your team) identify more of these people so that you can achieve product-market fit at scale.