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What is firmographic data and segmentation

May 19, 2022 | Teemu Raitaluoto
Firmographic segmentation

Firmographic data is a term thrown around in B2B sales and marketing to describe a set of characteristics related to a company. Read more about how to use firmographic data to segment your customers, find your ideal customer profile, and generate leads.

What are firmographics

Firmographics are characteristics of a company such as its revenue, industry, number of employees, technographics, domain address, and headquarters location. There are many more data points but these are the most common ones to describe a company.

Sales and marketing people use firmographics to understand who they should target when running outbound and inbound campaigns. Firmographics are useful because companies with different characteristics are interested in different things and are trying to solve different problems. For example, a company with a lot of revenue is likelier to buy enterprise software compared to a company with little revenue.

What is firmographic segmentation

Firmographic segmentation is used to group a large customer base into smaller segments to have better-targeted sales and marketing efforts. For example, a group of companies can be segmented into ones that have 50-100, 100-250, and 250-500 employees.

employee_count

Employee range segmentation

When a marketer offers their product to the right customer segment with a tailored message suitable for that segment, the customer is much likelier to buy. On the other hand, if a marketer approaches the segment with a message that is not compelling to them, the customers leave your emails unopened or leave your website. Different customer segments simply want and need different things so it's hard to maximize revenue with the same generic messaging.

Firmographic segmentation can be used in the first step of account-based marketing (ABM) campaign to identify the best-fit customers. Simply determine how to split your market into smaller groups using firmographics until you find the customers that are the likeliest to receive the most value out of your product.

Industrial segmentation is part of firmographic segmentation. It means segmenting companies based on their industry to create industrial segments such as "Consumer goods" or "Software services".

Top benefits of firmographic segmentation

Optimized resource allocation

One of the benefits of firmographic segmentation is the smarter use of company resources, eg. by sending better-targeted emails. Companies targeting all customers waste resources by trying to sell to customers who are unlikely to buy their product. Segmentation focuses the sales and marketing effort to only target those customers who are the likeliest to be most interested and who have sufficient resources to buy.

Improved customer communication and relationship

B2B customers today expect personalized communication. 65% of buyers are ready to switch vendors if they don't personalize their communication to the customer. Customer segmentation using firmographics is a step towards better personalization when the messaging is tailored to that specific narrow segment.

Better ROI

While saving resources just purely doing less work, more targeted segmentation helps you increase conversion rates leading to less money wasted. The improved ROI translates throughout lead generation but also customer retention. Better fit customers tend to not churn.

Ways to use firmographic segmentation

Inbound website lead generation

While firmographics are in popular use in outbound marketing and sales, inbound marketing can also benefit from using firmographic segmentation to maximize lead generation when combined with personalization.

Companies can use modern B2B website personalization to identify companies on a website, segment them based on firmographics, and show the visitor a version that is likeliest to resonate with them.

Aiven example-png

Personalized website using company size and industry to convert more leads

Website copy, images, logos, and call-to-actions should be optimized to best reflect the visitor's own background so that the content is as relevant as possible. More relevant content has been shown to increase conversions by 50-200%.

Find prospects fitting your Ideal Customer Profile

When you're prospecting, use firmographic segmentation to narrow your search. You can also tailor your message to fit the needs of the audience better when you apply good firmographic segmentation.

6 most useful firmographic variables

Domain

A company domain can be used to learn more about a company that is not immediately obvious by looking at its name, revenue, or industry. The website is a gold mine of additional data such as which customers the business serves, whether it's a B2B or a B2C company, and how it positions itself in the market.

Industry

The company industry is very relevant data when its accurate and detailed. Industry can be used to target specific offerings if your product only fits a niche industry. For example, a company selling healthcare devices should only focus on the healthcare industry.

Revenue and employees

Revenue and employee numbers are a good estimate of a company's size. The company size approximates well which problems it might be solving and whether they need your product.

For example, imagine you're selling an email marketing product, a company with a few employees might value ease of use of your product while enterprise customers value automation and security.

Technographics

The technologies a company is using tells a lot about the way it conducts its business. For example, a company using Hubspot might be more focused on inbound sales than a company using Salesforce. 

Headquarter location

A company's location tells a something about the company's culture and things they might value. Nordic B2B companies with a flat organizational structure buy products very differently than companies in Asia with a high organizational structure. They also prefer to buy in very different languages if they have the freedom of choice.

Related personalization playbooks

How to personalize content by industry

How to personalize your website by company size

How to guide customers to the right sales channel


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