The FY20 strategy and planning you completed just a few short months ago had a COVID-19 wrench thrown in which is resulting in the output already being outdated. Segmentation is the most foundational element of any strategic plan. The output drives which prospects and customers you target, determines who will work with them and what the message and offer will be. Now is the time to address segmentation head on to identify pockets of opportunity and update your routes to market mix. You can also refer to SBI’s response framework, detailing 7 Steps to Mitigate Revenue Impact by adapting your Go-To-Market to see where segmentation falls in.
Not all prospects and customers are created equally. Their likelihood to spend and how much they can spend has been drastically altered by the recent pandemic. If you cannot rank accounts best to worst on revenue potential and propensity to buy, you are missing the mark. The current environment with budgets being cut by the day also requires a closer look at how field, partner, phone, digital, and self-serve coverage can be rebalanced to match demand. You can read more from a previous SBI blog on why detailed account segmentation is 10x more valuable than TAM.
Steps to update account segmentations incorporating recent macro-economic changes:
Revisit Ideal Customer Profile Criteria
Your Ideal Customer Profile (ICP) indicates your sales sweet spot where companies represent the best fit for your product or service. These are the segments of the market that stand to benefit the greatest from adopting your solution. The ICP includes a cross-section of criteria that identifies your ideal target. Some of the most used criteria in defining the ICP are:
- Annual Revenue
- Total Number of Employees
- Industry Vertical
- Sales footprint (US, Global)
- Buyer Role
Other criteria may include company lifecycle (growing, mature, declining), workforce make-up, existing physical/technical infrastructure, or senior leadership changes.
COVID-19 has impacted the propensity to buy and spending habits for all companies. Revisiting the criteria used in your ideal customer profile is the critical first step to find the new sweet spot for your product or service.
Update Weightings of Each Attribute
Looking back at the attributes listed above (Annual Revenue, Total Number of Employees, Industry Vertical, Sales footprint (US, Global) and Buyer Role), you can easily see how each has been impacted by COVID-19. However, annual revenue and industry vertical are the two that will need to be analyzed the most to inform your new sweet spot. For example, in the past, industries like education, hospitality, and retail may have been highly scored. Shifting that scoring to focus on healthcare or certain technology companies will address the recent market changes. This may not be the case forever, but pointing expensive sales and marketing dollars at those verticals in decline will not result in the desired returns. In addition, revisiting how SMB or mid-market companies are scored will ensure your segmentation output is focused on the prospects and customers with the highest spend potential in the near term.
Review Output and Make Changes to Your Routes to Market Mix
The unprecedented cost-cutting most organizations are required to undertake will no doubt impact how the market opportunity is covered. Refreshed segmentation will inform how to maximize your route to market mix, for example:
- Customers and prospects with the highest propensity to buy and the largest spend potential should be assigned to the field sales team. You should also read SBI’s perspective on what virtual selling means for field sellers
- Customers who are spending a lot today, but have lower spend potential or customers who are not spending much today, but have high spend potential are perfect candidates for inside sales
- Prospects/customers with a medium propensity to buy or are in a location not covered by field sales are great options for partner coverage
- Customers and prospects who have low propensity to buy or lower spend potential should be directed to digital or self-serve offerings
Armed with this new insight, now is the time to refresh your account segmentation approach. This will help identify pockets of opportunity within your prospect pool and current customer base in the current COVID-19 environment. You can then focus your attention on adapting your routes to market mix between field, partner, phone, digital, and self-serve offerings.
Below are some additional resources you might find helpful:
- Adapting Your Go-To-Market During a Crisis: 7 Steps to Mitigate Revenue Impact includes an action plan framework and discussion with Josh Horstmann, Senior Partner at SBI.
- SBI’s LinkedIn community group Inspire Others where you can connect with other leaders like yourself and access additional content.
- Have a question? Submit it to the SBI Help Desk, and an expert will get back to you within 24 hours.