Firmographic segmentation

Firmographic segmentation groups companies based on attributes such as industry, size, revenue, and other factors. Marketing and sales teams use firmographic data to segment companies into groups for more targeted marketing efforts that drive B2B marketing success.

Like demographic segmentation, firmographic segmentation is one of the most basic segmentation types. However, it is still a powerful marketing strategy, especially for B2B marketers and anyone interested in account-based marketing (ABM) personalization.

How do industry leaders segment their audience for personalization? Find out in our report on industry segmentation patterns.

Marketing and sales teams can use countless variables to group companies. The following are the most common factors and provide a good place for B2B marketers to start:

Industry

Different industries have unique challenges, opportunities, trends, pain points, and jargon. Segmenting companies by industry enables companies to identify the most relevant sectors for their products or services. They can further tailor marketing messages to address each industry's needs and concerns, creating more impactful campaigns that resonate with their target audiences.

Company size

Company size is usually measured by employee count or annual revenue, placing companies on a spectrum from small businesses to large enterprises. Needs and constraints can vary significantly based on company size. For example, a small business might have budget constraints, while a large enterprise might focus more on security and reliability.

See how Personio, an all-in-one HR software solution, uses firmographic segmentation to market effectively to SMBs and enterprise clients.

Location

Grouping companies based on location enables marketers to focus on specific regions and concentrate their efforts on areas with the highest potential for success. They can also adapt campaigns based on local preferences, norms, and business practices.

Organizational structure

In B2B marketing, it is essential to identify and target the individuals who have decision-making authority or influence within a company. Understanding a company's organizational structure can help marketers tailor their messaging to engage key stakeholders and facilitate a smoother sales cycle.

Technological maturity

A company's level of technological maturity can significantly impact its openness to adopting new solutions and its ability to benefit from them. This can refer to overall tech-savviness and digital readiness, or specific technology usage. For example, targeting companies that use Shopify or another specific technology.

Firmographic segmentation is particularly useful for B2B marketers. Key benefits include:

Personalized marketing campaigns: Firmographic segmentation allows marketers to develop personalized messaging and content that address each market segment's specific pain points, goals, and interests. This personalized approach helps marketing and sales teams form a stronger connection with potential clients.

Increased pipeline generation: Using firmographic data to tailor experiences to the specific needs and pain points of each segment can increase demo signups and other forms of lead generation. See how firmographic segmentation helped Personio get 16% more demo signups.

Improved customer acquisition: Firmographic segmentation helps teams focus their marketing efforts on businesses that best fit their products or services. This targeted approach helps attract the right prospects, improves lead generation, and creates a more efficient customer acquisition process.

Enhanced customer retention: By tailoring marketing messages to each customer segment, you can highlight the value propositions most likely to resonate with potential customers. This makes your communication more relevant to their needs and positions you as a valuable partner who understands their challenges and can provide relevant solutions.

Higher revenue and profitability: Targeting the right segments also allows marketers to focus on higher-value clients, leading to larger deals and increased revenue. Additionally, personalized marketing strategies often result in higher customer lifetime value, as satisfied clients are more likely to make repeat purchases and refer others to new business opportunities.

Data-driven decision-making: Firmographic segmentation provides valuable insights into the market landscape, enabling marketers to make data-driven decisions. By understanding each segment's specific characteristics and needs, businesses can develop more effective marketing initiatives and adapt their offerings to better serve their target audience.

Some common challenges businesses face when implementing firmographic segmentation strategies are:

Data collection and accuracy: Obtaining accurate and up-to-date firmographic data can be challenging, as information may be scattered across various sources.

Data integration: Firmographic data works best in combination with other types of customer segmentation. Integrating this data can make firmographic segmentation more complex.

Resource allocation: Allocating sufficient resources, including personnel and budget, to develop and execute effective segmentation strategies can be challenging for many organizations. Learn how AI-native personalization solutions are helping companies personalize at scale.

Evolving market conditions: Changes in market conditions, industry trends, and customer preferences may require businesses to continuously update their segmentation strategies.

Regulatory concerns: In highly regulated industries, businesses must ensure their segmentation efforts comply with relevant privacy regulations and ethical guidelines.

Explore tools that provide firmographic data

Many tools, including Albacross, Clearbit, 6Sense, Zoominfo, and Demandbase, can provide firmographic data. You can then activate this data with an AI-native personalization platform, like Ninetailed by Contenful.

Leverage your CRM system

Extract data from your existing customer database and CRM to gather firmographic information

Social media

Analyze company profiles and activities on social media platforms (especially LinkedIn) to gather additional insights

See how easy it is to set up segments and start delivering personalized experiences with AI-native personalization, or contact us to see how Contentful can help your business scale personalization faster.

Up next: Technographic segmentation

Explore how technographic segmentation helps businesses tailor marketing based on customer tech usage. Learn how to collect and apply this data effectively.