Market segmentation divides a broad market into distinct subgroups that have different needs, characteristics, or behaviors. Effective segmentation lets you focus your limited resources on the most valuable and accessible segments first.
Common segmentation criteria for B2B: (1) Industry/vertical, (2) Company size, (3) Geography, (4) Technology adoption stage, (5) Budget level, (6) Decision-making process, (7) Use case.
The best initial segment is: large enough to matter, small enough to dominate, underserved by current solutions, and accessible to your sales channel.
Key Takeaways
- Segmentation focuses limited resources on the most valuable groups.
- The ideal beachhead: big enough, accessible, underserved, reference-able.
- Use 4-5 criteria to segment, then prioritize ruthlessly.
- Dominate one segment before expanding to others.