We know the importance of segmentation. It is important because it recognises that everyone is different. Indeed, everyone is unique. The good news is that there are significant similarities among people and companies they can be grouped together into worthwhile addressable targets. How we segment our customers is up to us. Ideally we should group them together in terms of their different needs. However, this isn't always easy because needs keep changing. Indeed, the same person or company could have varied needs depending on circumstances. This could result in us communicating the wrong message if we find that they are in an alternative mood.
People can be segmented according to their age, gender, income and, of course, their needs. Businesses can be segmented according to the size of companies and the nature of their business. This isn’t exactly a needs based segmentation but company size and industry vertical very often affects how a company acts and what it wants and so these “demographic” criteria are excellent proxies for needs (when we group businesses using these demographic criteria we call them “firmographics”).
Once customers are grouped into firmographic clusters we must think about how they make buying decisions. Businesses don’t make decisions, it is people within businesses who choose brands and suppliers. These decision-making units (DMUs) are made up of more than one person. It is likely there will be someone in the buying department who assembles a list of suitable brands and suppliers. A technical person will give an opinion on the capabilities of the products and suppliers that are being considered. A senior buyer will lead the negotiations. A director will sign off the deal. What we know about the people in the DMU is that they behave and think quite differently depending on their age. Young people in business spend more time researching and thinking about decisions. Millennials (26 to 41 years old) spend longer thinking about things. On average they spend 13 weeks in an initial research phase when making a decision on behalf of their company. Gen X (42 to 57 years old) spend 12 weeks and baby boomers (58 to 67 years) deliberate for only 8 weeks.
These different groups not only spend different amounts of time making up their minds, they demand different things. Millennials want brands that make work more enjoyable. They are also sensitive on environmental, social and governance issues (ESG). B2B websites that look dated and have clunky and heavy text will not appeal to modern B2B customers. Millennials want websites to be intuitive, simplified and offer them the same high-end experience they get in their personal lives.
Gen X members of the business DMU want to learn new skills and knowledge. An offer that includes white papers and great explanations appeal to this group.
Boomers in business DMUs can't be doing with all that excitement that fires up millennials and can be dismissive of white papers which they see as “teaching granny to suck eggs”. They want to grow their personal network and they want to be acknowledged and respected. However, these people crave respect for their age and experience and a little bit of fawning (done in the right way) will go down well.
It follows therefore that successful communications with business DMUs must understand the composition of the decision-making unit and the roles that people play within it. Different people require different communications. That said, there are some things that are important to every member of the DMU, irrespective of their age - whatever the age of decision makers in business, they look for brands that won’t let them down. What was that old saying? "Nobody ever got fired for choosing IBM".