Robust Customer Segmentation Strategy Challenges in B2B

Robust Customer Segmentation Strategy Challenges in B2B

Customer Segmentation Strategy in B2C: Analytically Based

For many online B2C companies, a robust customer segmentation strategy developed with advanced analytics is a standard operating procedure. Marketing, product and analytics work together to create new offers and messaging campaigns. Today, a CPG brand might send out 700 personalized emails/week that are AI-generated and based on the consumer’s past online behaviors.

Customer segmentation strategy that leads to delivering customized offers is nothing new. For example, 15 years ago US credit card issuers sent out over eight billion pieces of direct mail. 

This suggests that many B2C firms find that investing in customer segmentation is worth considerable time and investment.   

Robust Customer Segmentation Strategy Challenges in B2B

Customer Segmentation in B2B: Connecting Personas and B2B Customer Segmentation

While there may be B2B firms that are using an analytic based approach to customer segmentation strategy, we don’t see this as frequently.

Typical B2B customer segmentation examines facts like current spending in the market, judged potential, industry and geography.  This approach often results in a segmentation with mega, small, medium and large accounts.  

B2B marketers will develop customer “personas” or descriptions of target customer profiles to guide messaging and product development. There is often a push to rapidly develop these personas based on hypotheses, leveraging the experience of the team. In some organizations, an actual customer and/or research insights may be used, while in others the persona is a creative exercise.  

To be clear, our Insight to Action team are fans of a hypothesis-driven approach. But, there can be a lack of analysis supporting the B2B customer segmentation strategy and the personas that represent the target segments.

As a result, there often isn’t a clear connection between the personas and the B2B segments.   

Robust Customer Segmentation Strategy Challenges in B2B

Better Research Equals Better Customer Segmentation Strategy

We recommend a more robust approach to developing the personas, using survey data and interviews. 

We’re shared seven practical approaches to generating quality insights to drive personas.  These included:

  • Keeping the initial conversation future focused and starting with broader trends and strategy context
  • Taking the time to bring it all together

An exception may be in the B2B2C space, where the small business customer is essentially similar to end consumers, and similar approaches are taken as in B2C.

Moving from the small business market into mid-sized and enterprise customers, there are often multiple decision makers involved in a purchase decision, with more variables to consider in developing the segmentation and the personas.

For more resources on customer segmentation, visit our resources page or contact us.

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