Targeting a business market segment can greatly improve you B2B business. But do you know what to look for in a business market segment? Do you know how to pick a business market segment with shared interests and common behaviors that make one group of businesses your best potential customers?
While the most common type of market segmentation for business-to-consumer companies is demographic segmentation, the most common type of market segmentation for B2B companies is firmographics. Thus firmographics provide the best starting place when selecting a business market segment.
Firmographics are facts about a businesses that help to group them into target markets, but do you know what firmographics to use in determining your best business market segment?
This article covers three broad categories of firmographics that provide numerous ways that you can select a specific business market segment to target. These include:
Using Organizational Firmographics To Select a Business Market Segment
Select a Business Market Segment by Financial Firmographics
Selecting a Business Market Segment With Industrial Firmographics
Using Organizational Firmographics To Select a Business Market Segment
The first organization firmographic to consider in selecting a business market segment is size. You separate potential business customers into sizes by considering how many employees they hire, how many plants, stores or branches they include at where they are located.
Size distinguishes businesses in several ways. Number of employees can help you determine whether the business owner or an employee is in charge of purchasing. Number of plants, branches or stores can mean that each makes individual purchasing decisions. Thus, knowing size helps to determine how many people and the type of people B2B business owners have to contact and build relationships with.
Each business market segment also differs by company age. Young businesses need different types of products and services than more established businesses. They usually have limited resources and less cash flow so they need vendors who will guide them in making good purchase decisions rather than just selling to them. By providing this service to new businesses, you can turn them into loyal customers.
Buinesses differ by location because people and business cultures vary by regions. Furthermore, regulations, tax laws and economic factors distinguish business by location.
You can use organizational firmographics to select a business market segment with good profit potential. Then you can target that business market.
Selecting a Business Market Segment With Financial Firmographics
A business market segment also differs by sales volume, profits and market share. These financial firmographics can help a you to determine the businesses most likely to buy your products.
For example, if you sell a machine that automates packaging products, it's more likely that businesses with large sales volume will purchase your machine than will smaller ones, whose small sales volume makes human packaging less expensive.
Ownership factors can also help you select the business market segment for your target market. You need to know whether the business leases or owns its office, plants, stores, warehouses, and equipment. By monitoring the relationship of ownership factors, you can determine relationships between these factors and the businesses needs and purchases.
B2B business owners can determine which businesses are most likely to purchase their products or service by knowing how financial firmographics influence purchasing decisions.
Selecting a Business Market Segment With Industrial Firmographics
Selecting a business market segment by industrial firmographics requires understanding different industries' regulations, standards, inspections and expectations. These industrial differences cause businesses in one industry to want and need different types of products and services than a business in another industry. Selecting an industry where firmographics create a market for what you sell helps to pick your best target market.
Industrial firmographics influence not only a business' needs and desires, but also the kinds of customers they are.
A manufacturing business market segment that uses high-tech equipment in its production differs considerably from a manufacturer who uses only low-tech production. They purchase completely different equipment and supplies, use different processes, and have different facility needs.
A business that produces high-end items for the luxury market will use different components than one that produces in mass for discount stores. The former will spend more for quality components and buy add-ons to upgrade features.
A consultant is a business market segment in the information industry, but the consultant's business is very different from a major book publisher. Consultants' incomes are limited by how much they can charge for their time. Book publishers' incomes are limited only by the number of books they can publish and sell.
Thus, if you know how industrial firmographics affect businesses' needs for what you sell, you can select a business market segment that provides new, and potentially long-term repeat, customers.
In Conslusion
B2B business owners can improve their marketing with organizational, financial and industrial firmographics.
Thus, you should keep records of all contacts with present and potential business customers. Then categorize those records by business market segments so that statistics can reveal the best way to relate to a specific business market segment.
With such records, and an understanding of different firmographics, you can select your target market from the most profitable business market segment.
While the most common type of market segmentation for business-to-consumer companies is demographic segmentation, the most common type of market segmentation for B2B companies is firmographics. Thus firmographics provide the best starting place when selecting a business market segment.
Firmographics are facts about a businesses that help to group them into target markets, but do you know what firmographics to use in determining your best business market segment?
This article covers three broad categories of firmographics that provide numerous ways that you can select a specific business market segment to target. These include:
Using Organizational Firmographics To Select a Business Market Segment
Select a Business Market Segment by Financial Firmographics
Selecting a Business Market Segment With Industrial Firmographics
Using Organizational Firmographics To Select a Business Market Segment
The first organization firmographic to consider in selecting a business market segment is size. You separate potential business customers into sizes by considering how many employees they hire, how many plants, stores or branches they include at where they are located.
Size distinguishes businesses in several ways. Number of employees can help you determine whether the business owner or an employee is in charge of purchasing. Number of plants, branches or stores can mean that each makes individual purchasing decisions. Thus, knowing size helps to determine how many people and the type of people B2B business owners have to contact and build relationships with.
Each business market segment also differs by company age. Young businesses need different types of products and services than more established businesses. They usually have limited resources and less cash flow so they need vendors who will guide them in making good purchase decisions rather than just selling to them. By providing this service to new businesses, you can turn them into loyal customers.
Buinesses differ by location because people and business cultures vary by regions. Furthermore, regulations, tax laws and economic factors distinguish business by location.
You can use organizational firmographics to select a business market segment with good profit potential. Then you can target that business market.
Selecting a Business Market Segment With Financial Firmographics
A business market segment also differs by sales volume, profits and market share. These financial firmographics can help a you to determine the businesses most likely to buy your products.
For example, if you sell a machine that automates packaging products, it's more likely that businesses with large sales volume will purchase your machine than will smaller ones, whose small sales volume makes human packaging less expensive.
Ownership factors can also help you select the business market segment for your target market. You need to know whether the business leases or owns its office, plants, stores, warehouses, and equipment. By monitoring the relationship of ownership factors, you can determine relationships between these factors and the businesses needs and purchases.
B2B business owners can determine which businesses are most likely to purchase their products or service by knowing how financial firmographics influence purchasing decisions.
Selecting a Business Market Segment With Industrial Firmographics
Selecting a business market segment by industrial firmographics requires understanding different industries' regulations, standards, inspections and expectations. These industrial differences cause businesses in one industry to want and need different types of products and services than a business in another industry. Selecting an industry where firmographics create a market for what you sell helps to pick your best target market.
Industrial firmographics influence not only a business' needs and desires, but also the kinds of customers they are.
A manufacturing business market segment that uses high-tech equipment in its production differs considerably from a manufacturer who uses only low-tech production. They purchase completely different equipment and supplies, use different processes, and have different facility needs.
A business that produces high-end items for the luxury market will use different components than one that produces in mass for discount stores. The former will spend more for quality components and buy add-ons to upgrade features.
A consultant is a business market segment in the information industry, but the consultant's business is very different from a major book publisher. Consultants' incomes are limited by how much they can charge for their time. Book publishers' incomes are limited only by the number of books they can publish and sell.
Thus, if you know how industrial firmographics affect businesses' needs for what you sell, you can select a business market segment that provides new, and potentially long-term repeat, customers.
In Conslusion
B2B business owners can improve their marketing with organizational, financial and industrial firmographics.
Thus, you should keep records of all contacts with present and potential business customers. Then categorize those records by business market segments so that statistics can reveal the best way to relate to a specific business market segment.
With such records, and an understanding of different firmographics, you can select your target market from the most profitable business market segment.
About the Author:
You can get more information to improve your B2B business by getting Linda Morton's free report Improving Your Marketing. You can also get her free report on Market Segments. Get a totally unique version of this article from our article submission service
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