Hardcore Funnel Tactics: Deep Dive into 3 Popular Segmentation Methods

Once you’ve set up a nurturing campaign, you should begin to see all sorts of data (if you look for it) along with a potentially decent bump in sales.

The best piece of advice we can give at this point?

Don’t stop.

Now you can test and tweak to increase conversions even more and improve the overall customer experience with your brand.

You do this through segmentation, or putting your list of leads into groups based on a number of factors and delivering content that is better suited for each group.

You segment a lead based on multiple triggers and indicators during their journey with your business. There are three main methods (right now), and the data used is different in each.

Which one is right for you?

Good question. In this post, we’ll look at these three methods including benefits and the business models it may be suited for, but keep one thing in mind:

You can use one or all of these methods depending on the nature of your business, so it’s definitely not an exact science.

Let’s get into it.

Method #1: Industry/Firmographic and Demographic

Ok, so this is more like two tactics rolled into one, but they are very similar. Both B2B and B2C businesses have leads that they would like to become customers. There are differences, but the principles are the same.

B2C Demographic

If you are selling directly to consumers, you’ll want to know personal information. You can go too crazy with this, so be careful not to become the NSA, but demographic information can include:

Choosing the data that is beneficial for sales really depends on the business. If you have a men’s clothing line, marital status may be less important than say geographic location (you don’t need to know his wife’s name to sell him a sweater, but you better know if it’s cold there.)

B2B Firmographic

For this segmentation technique you’ll want to collect similar data on a business, not (necessarily) an individual. Different size companies have different needs, various industries use your products in a variety of ways. Here are a few data points to consider extracting:

Again, choosing which factors are best for your goals is important. If you only sell to one industry, you should already know it well enough, but if they vary in size and revenue there could be data that leads to higher sales.

Pro Tip: If you really want to achieve master level segmentation (in the B2B space) you can combine demographic and firmographic. By finding out the details of company decision makers, you’ll be speaking to a business and a consumer.

Good: It can seem to your leads like you really know what they need. You swoop in and help them where they are based on their individual or business traits.

Not So Good: You can go very deep, but you can’t scale it very efficiently (there are only so many candy manufacturers in Idaho, right?)

Who It’s For: Every B2B should be doing some form of firmographic data segmentation, and pretty much any B2C business needs to develop a nurturing system based on a number of factors that are important to your brand and products.

Method #2: Customer Tiering

This method of segmentation is not for the faint of heart, but can pay off big time with long lasting clients.

You’re probably familiar with the more tradition funnels, the ones that start out with a lot of prospects, creates a decent amount of leads, and a solid number of customers coming out of the bottom.

Tiering is a different strategy that targets potential leads not solely based on how well you fit them, but how well they will fit your business over time. We probably need an example.

Example: You’re a dental supply manufacturer in the MidWest, which is a rapidly growing sector. Your ideal customers are dentists who are looking to grow from one location to 3-5 in the next few years, but service small to medium practices regionally. Finding the dentists that are bent on expansion and speaking to their eventual growth will increase your revenue (in the future) without the need for further sales.

Content can be created to help them achieve their goals, while also conveying your supplier as the best option for their growth. To continue with the example, you would send dentists content about staffing, or leasing multiple properties, and sourcing supplies from one manufacturer (you).

Good: It’s a model based on growth, and pays off well for companies looking to the future.

Not So Good: Requires a ton of energy to set up and may not be based on specific data, making it hard to capture leads.

Who It’s For: This can be a great option for a B2B who has a decent performing funnel and wants to look for long term customers they can grow with over a long period.

Method #3: Needs Based

This method has some great potential if implemented correctly. You may have to pull a little bit of data from both of the other segmentation methods to make it work. By the name of the method you have to have a keen understanding of their needs, which comes by understanding the demographics/firmographics of your prospects.

Time for another example:

Example: You’re a bulk plumbing parts supplier out West. You serve local businesses and can ship anywhere in the U.S., but it’s only cost effective for mid to large size plumbing companies due to shipping costs. Using the data of your leads you can segment them (like the image below).

This can help you avoid sending offers that wouldn’t benefit or relate, as well as set yourself up as an authority, by offering proper industry content based on what they need (hence, Need Based).

Good: Understanding and being able to convey and fulfill the needs of your potential customers is a huge conversion booster.

Not So Good: Sometimes it’s tough to understand what a customer needs in specific relation to your product. It may be an option for leads already in your funnel, but not very good for prospecting purposes.

Who It’s For: Perfect for B2B companies who service businesses in multiple stages of revenue and development. Also good for B2C with products that speak to specific problems or fears (budgeting, security, etc.).

Choosing The Right Segmentation Method For You

Your segmentation method will take time, and may end up being bits and pieces of multiple techniques.

The most important thing to remember is to go slow. Every segmentation you make to your funnel should be based on data, and then tracked to determine whether or not it’s working the way you want.

Trial and error and split testing are the best ways to ensure a healthy and maturing funnel over time.

What are you doing to improve your funnel?