Product Marketers should help Sales sell. Research says that the buying experience now drives B2B customer loyalty much more than product features, price, or vendor brand reputation. So is there more that Product Marketers can be doing to help Sales create experiences that really connect? Yes, there is, and it’s called “experiential segmentation.”
Your customer segmentation model may be perfectly rational, and that may just be a bigger obstacle than you realize
As the differentiating power of traditional sales levers (price, features, brand reputation) wane, the buying experience is growing more important. Product Marketers are responsible for providing buyer insight, often in the form of personas, that help Sales sell. Yet, according to our research at Quarry, the customer segmentation model employed at 70% of B2B enterprises is not meaningfully different from that of competitors. And that poses a problem.
A persona, like any other form of “target” definition, pre-supposes an underlying segmentation perspective. Take a look: Are your personas differentiated, one from the other, by means of some categorical framework? Job title, for instance? Or company size? Or industry vertical? Each of these categories is a segmentation perspective. Each encodes a theory that says, in effect, “this system of differences between people explains and predicts differences in how they behave.”
These category-driven theories, we must presume, have some basis in fact. But they also suffer from two liabilities that you would be wise to consider.
First, as noted above, for 70% of B2B marketers these theories are not proprietary. If the segmentation perspective – meant to be the “difference that makes a difference” – embedded in your personas is the same as the segmentation perspective of your competitor, then, even if you have done an excellent job in every other respect with your personas, the utility that Sales can extract from personas for the purpose of differentiating the buyer’s experience has been limited from the outset. Letting this situation persist hinders an experience-led sales and marketing strategy where customer insight is the edge in creating experiences that connect differently and better.
Secondly, even where they may be differentiating, these categorical segmentation perspectives are proving to be weak theories. They rest on assumptions that are crumbling under the weight of evidence and changing circumstances. Let’s take the commonplace (some might even say “best practice”) of using organizational titles as the foundational categorization scheme for personas.
Job titles may feel meaningful but…
In my recent interview with CEB’s Pat Spenner, Pat underscores how CEB’s research on the consensus-driven nature of B2B purchases reveals that both job title and organizational rank are weakly correlated with the propensity for an individual to stick their neck out to lead the consensus buying group to consolidate their understanding of a problem, establish the criteria for a solution, select a vendor and seal the deal for a quality solution. In short, according to that research, “Mobilization,” not “job title” or “rank,” is “the difference that makes a difference.”
Moreover, these top-down categorizations of customers (role, size, vertical) rest on a body of 18th century rationalistic economic and psychological theory that assumes human beings behave in the marketplace as “rational actors.” The last few decades of research in behavioral economics, prospect theory, neuroscience, organizational behavior and cognitive linguistics converge in a way that is extremely harsh to that “rational actor” notion.
Now, chances are, you have a somewhat change-averse colleague. Let’s call him Larry. Larry will argue, “well, maybe our segmentation model is the same as our competitor’s for a good reason; maybe that is just what reality looks like.” For Larry, the fact that your segmentation model is the same as a competitor actually feels reassuring – an independent source of validation. And Larry might also assert that while job titles are a weak predictor of “mobilization,” they still seem indispensable to operationalizing B2B demand-gen tactics.
And here’s where you as a Product Manager need to make a choice. You could defer to Larry. You could spend a bunch of time trying to argue with him. Or you could take the lead in creating and implementing an alternative that is better aligned with our contemporary understanding of how buyers buy, how humans behave and how experience-driven sales and marketing works. In short, you could embark on an “experiential segmentation.”
When curiosity leads, new insights can follow
What might that process look like? It starts with setting in brackets the current categorical assumptions about the differences between customers that make a difference. It involves a curiosity-driven exploration of your customer’s broader context – not just what your customer thinks about your brand or your category of products. It involves a recognition that the complexity in people’s motivations and the contradictions discovered in their self-stories are not noise to be discarded but instead are foundational assets for building proprietary customer insights. And it involves a certain amount of change management leadership to get your colleagues aligned around an insight-rich view of the customer that is proprietary and custom-tailored to creating differentiating experiences for your customers – both in digital demand-generation channels and in face-to-face selling. If you’d like to learn more about that, you can read about it here.
It’s not necessarily easy. Partly because some reassuringly familiar things must be abandoned. Simple categories and tidy, “rational actor” assumptions about b2b purchase decisions need to give way to a more nuanced multi-dimensional viewpoint on buyer’s motivations. And, (something that may make Larry nervous) you’ll have fewer “best practice” examples you can point to for reference until you actually get there. But what are your options? Buyer experience is increasingly driving sales. If you take seriously your responsibility to provide Sales with buyer insight, it’s hard to ignore the evidence that segmentation, as it is widely practiced, undermines experience-based differentiation. There is more that Product Marketers can be doing to help Sales create experiences that really connect. It’s called “experiential segmentation.” And it will separate you from your competitors.