One of the most complex challenges in B2B sales is identifying the right prospects that are fit for your offerings. Companies invest a significant amount of resources and money to feed leads into their sales pipeline, out of which many leads are inappropriate or uninterested.
As a result, your money and resources are lost on two major fronts: sourcing leads and following leads. In this blog post, we are looking at ways that utilize how firmographics data can help you save money and resources while boosting ROIs.
Asking firmographics questions to your leads to profile them can give you much clarity that many companies fail to have, as simple as they sound. And from the marketing perspective, firmographics data are like gold dust. With better understanding about who your customers are, you can easily define key segments and can also create campaigns that will pack a punch with a specific group.
Your organizations can easily prioritize opportunities having the most potential with the help of firmographics data. And over time, you will also understand the basic profiles of prospects that are more likely to do business with you.
What is firmographic data?
Firmographic data essentially is information about the attributes of companies that are used to categorize those companies into useful market segments. Firmographic data are quite similar to demographic data, but firmographics data specifically apply to firms.
Some basic examples of firmographic data include the following:
- Number of Employees
- Industry (SIC Code, NAICS Code)
- Geographic area
- Type (Public, Private, Subsidiary)
- Fortune Ranking
This firmographic data is essential to successful lead generation, lead management, and lead nurturing. And a sales team can easily use it to adapt their sales pitch and their approach as well to any specific prospect.
Example; imagine the difference in communication that a leading CRM company varies with its different prospects based on their scale and size. The messaging to different prospects will be entirely different.
Any savvy sales representative will understand that any additional information about a prospect is highly useful. This information can easily be used to guide a sales pitch and tactic, and it’s no surprise that many companies choose to invest heavily to acquire firmographics data. And as we’ll see in this blog post, firmographics data pays for itself.
The purpose of firmographics
Defining firmographics attributes and segmenting markets accordingly enables companies to do the following;
Reveal business insight
Firmographics data enables companies to uncover business insights into B2B target markets by helping them to answer the most commonly asked question like the following;
- How many employees do they employ?
- Where are the companies in this target market located geographically?
- What’s the value of each business?
Categorize firms by industry
Firmographics data helps B2B companies to accurately categorize their prospects organizations in their target markets by industry type.
Example, technology companies will have very different defining attributes than educational firms or government entities. Accordingly, these companies should be marketed and sold differently based on the industry they are in.
Optimize marketing strategies
By promoting effectively customized and targeted messaging that aligns better with the pain points of companies in each market segment, a company can be confident in their marketing and sales strategy.
Sending the right message to the right prospects at the right time is the strategic tactic that marketers aim for, and firmographics data help a great deal in achieving this goal.
Avoid lost opportunities
Following an informed sales strategy and optimizing marketing tactics that are backed by data significantly decreases the risk of missing out on opportunities for a company.
Understand trends in data
Evaluating analytics and reporting from markets segmented based on firmographics data enables professionals to recognize the trends in data.
And these trends than can easily be accounted for during sales and marketing efforts, finally improving the efficacy of these efforts.
Clearly, firmographic data is very valuable and highly useful, but it important that you capture the right information. Here’s a look at the most important firmographic data to collect.
The most important firmographic data to collect
Similar to demographics data, some firmographics data points are more insightful than others. And it’s very important to understand that the list of the most important firmographic data points in this blog post will vary according to your niche and business.
Example; Let’s say that you sell software solution for enterprise project management so it will be imperative to know if your leads use Windows or Mac operating system. But this information may not be useful for other types of business.
Following are the most important pieces of firmographic data:
Type of Firm
It’s very important to understand the type of organization you’re dealing with. The criteria of for being a fit prospect of a particular company will usually depend on these criteria and your approach certainly will.
Following are some of the most common types of firms:
- Non-governmental organizations
- Governmental bodies
- Nonprofit organizations
- Retail stores
- Public vs. Private companies
- Independent contractors
- Educational Institutes
Your sales pitch and approach will differ based on the type of each company. The sales pitch and messaging that you use will definitely vary, and some companies even have a pricing structure that differs based on the type of company they are dealing with.
The industry a company is in will usually determine if they are a fir prospect, what motives do they have, and the best ways to pitch your offerings to them.
Following are some of the most common industries:
- Real Estate
As each industry is different, you may discover that you exclusively deal with some companies while avoiding others. It’s common for many companies to totally operate within just one industry, so this firmographics data is necessary when gathering your prospects.
Do your prospects qualify in terms of revenue? If you can get this information, it will provide you a good indication as to whether the prospect is fit for your offerings or not.
While sorting through your prospects, this quantifiable metric can act as a binary filter and is also one of the most important pieces of firmographics data. Although it may not be accessible directly, there are many methods to extrapolate it, so you can make an estimate.
Number of Employees
The size of a given company can be a very important piece of firmographics data. Let’s say that you want to pitch your enterprise HR tool, so you’ll have a clear understanding of the minimum size of a company to be fit for your enterprise HR tool.
As a sales representative, things start to get quite interesting when you begin to go deeper into firmographic data and looking at historical trends. Is your prospect positioned for growth? If yes, how quickly have they grown during the last year?
This type of information is important, so it can help you easily identify qualified leads without any kind of manual effort.
The location of a given prospect is of-course an important piece of information. Example; It can provide you a good indication of business hours, time zones, working hours, and customs.
This information may be more critical to some companies than others. Let’s say offer a social media platform that’s quite hands-off. If so, the traditional office hours become less of an issue.
How to use firmographic data to improve your sales process
Its one thing to have a plethora of firmographics data, but it’s another to use it to effectively improve your sales process.
Acquire Quality Data
The first important step for effectively using firmographic data is to ensure that you only acquire the richest and most accurate data. And if you use bad data that is not accurate to inform your decisions, you could derail your sales funnel.
Before collecting firmographics data, ensure that you have a strategy in place. This strategy will determine which data you need, and how it will be used to shape your entire sales process. With a well-developed, keen strategy in place, your firmographics data will really help you close more sales deals.
With the data in your hands, it’s time to begin segmenting your prospects. Try to think about how you can filter this data in a way that will help your sales team perform better.
Let’s say that your business is targeting midsize companies in the agriculture space. You could filter your data in a way that companies meeting those two criteria are given priority labels. As a result, they will be forwarded to your expert sales professional so you can find interesting ways to look at the data that can be very valuable for your sales initiatives and boosts your revenue.
Target your audience effectively
Firmographics data are excellent when it comes down to targeting your audience. You will no longer have to depend on instinct or calling your prospects on a whim hoping to make a sale.
Let’s say you want to market or call on to your top 50 most spending customers in the office products industry, in Washington with Staples as your main competition and over 100 employees. Good use of firmographics data will have this information for you in no time- without any hassle of trawling through invoices, spreadsheets and researching prospective companies.
If you’re segmenting your target audience based on firmographics data than you’ll be able to easily identify the pain points, needs, concerns, and objectives across similar prospective businesses, making those all-important first phone calls that much more effective.
Analyze Potential ROI
Firmographics data can be used to accurately assess the level of ROI you can expect if your sales team closes the deal with a specific prospect. This strategy can be a very effective way to order your prospects and make better use of your firmographics data.
Although you may already have a good idea about the key prospects in your industry, you can acquire useful data that helps you to prioritize and allocate the prospects among your sales team. This data is also very important from a strategic point, as it helps the C-suite allocate budgets and make annual projections accurately.
Keep things consistent
Firmographics data don’t require a high tech piece of software for themselves to keep track of, just some time and the patience to ask the right firmographics question. Although software tools will make your life little easier, most of the sales representatives can keep track of firmographics data using a basic spreadsheet.
Meanwhile, the software tools of today will make things a little more consistent when it comes to collecting firmographics data. And a good CRM will have soft-labels enabling the addition of fields to any customer record so managers can ensure things like size, location, revenue, and so on are all recorded.
Considering all this, you need to be making good us of firmographics data in order to increase your bottom line. Even small insights can make big waves in your pool of opportunities. You never know, it could be one of the most fruitful processes you ever implemented.
Personalize and automate marketing efforts
The firmographics data can be used to help you cater to your marketing efforts and sales pitch. Let’s imagine run a big PR firm that aims to work on global projects.
Depending on whether you’re pitching to large-scale companies or non-governmental organizations your entire marketing approach will vary.
The intelligent use of firmographics data can help you decide on the most appropriate strategy, based on the type of firm you’re approaching.
Know the makeup of your existing customer base
It’s slightly worrying and surprising how many people don’t know who their main customers are off the top of their mind. Not specific customers, but just knowing things as simple as their industry, location, company size, turnover, and the number of employees.
Knowing who your ideal customer is exactly will help you no end in your sales efforts. If you know that an average customer has close to 25 employees, turnover of $6 million across 5 branches- you can effectively target businesses of a similar to this. It will save big red crosses on a spreadsheet and a lot of wasted profiling calls.
Meanwhile, when integrated with business intelligence tools, you can also use firmographics data to predict the usual buying pattern of a certain type of customer.
If you know in terms of firmographics that similar customers to “Prospect A” buy a particular brand or complimentary item, why not offer a similar product or a promotion on this product? This is the strategy that the e-commerce giant Amazon has taken with that: “people that bought this item also looked at…” option in a B2C environment.
Don’t Lose Sight of User Needs
While firmographics data can be very useful, don’t let it become your only guiding light. And a sales representative, you should use firmographics data as one of the tools in your stock. Some organizations make the mistake of depending too much on firmographics data, so they lose sight of the needs of their prospects.
More than ever before, firmographic data is very powerful and companies are turning to this powerful tool as a way to improve their sales results. We hope you’ve found this glimpse into firmographic data to be useful.