What are the common pitfalls and challenges of segmenting B2B markets?

In the advertising tech industry, there are various stakeholders with different roles and responsibilities involved in the decision-making process, such as media planners, hands-on-keyboard buyers, data scientists, and executives. To address this complexity, it is key to analyze the customers' job titles, responsibilities, purchasing power, and behavior patterns to create accurate customer personas and journey maps.

Market segmentation can be more complex in certain industries than others. IT industry, for instance, presents intricate segmentation challenges due to the long buying cycle and the rapid pace of technological changes. Frequent technological advancement requires buyers to keep pace with the latest developments to make informed buying decisions. Hence, the variation between the setting in which buyers decide to make a purchase and the actual act of buying can be significant. Plus, most IT buyers depend on 3rd-party advisory firms for decision-making. E.g., the buyer may hire Deloitte to help them choose the right IT vendor. It can be, thus, complex to comprehend whether buyers prefer direct sourcing or sourcing through an advisory firm.

To effectively advertise to a B2B market, utilizing third-party data is crucial. This refers to external data sources that can be imported as a custom audience into an ad account. By using third-party data, you can create a targeted audience of individuals who meet specific criteria, such as being a CEO of a company with a revenue of $5 million or more. This helps prevent wasted ad spend on unqualified viewers. To explore potential third-party data providers, consider checking out Oracle Data Cloud, DeepSync, and LiveRamp.

As a fractional CMO, my tips for B2B marketers: Use data to identify meaningful segments aligned with objectives. Monitor segment performance with key metrics. Tailor messages to target segments for customer satisfaction. Ensure segment validity by monitoring market trends, preferences, competition, tech, and environment. Regularly update or modify segments to remain relevant. Effective segmentation is crucial for successful B2B marketing. Follow these tips to create targeted campaigns that generate revenue and loyalty.

A regular, contextual validation of market segments is especially crucial in today's unpredictable business environment. Besides, insufficient market research to identify relevant segmentation variables can result in incomplete market understanding and ineffective segmentation. For example, Neglecting important variables such as decision-making processes can lead to under or over-segmentation, which may result in increased costs, inconsistent messaging, and challenges with personalization. In all, it is not enough to only understand the important segmentation variables. Regularly validating market segments is also essential for successful segmentation in the face of constantly evolving business conditions.

Lack of 'segmentation strategy' integration across all touch-points Siloed departments and lack of 'segmentation strategy' integration across sales, marketing, and customer service teams can lead to a fragmented customer experience and missed opportunities. To avoid this, it is important for companies to integrate their segmentation strategy across all customer touch-points. This means that all teams should have a clear understanding of the segmentation strategy and how it applies to their role in the customer journey, to provide a cohesive and personalized experience to the customer. By integrating the segmentation strategy, companies can improve customer satisfaction and increase the chances of converting leads into sales.