Whenever your accounting firm is looking for growth, it essentially has two options. Option one is to look for the same kind of client you’re already serving, and option two is to look at new market segments and trends as potentially uncharted client territory.
Both options have their pros and cons, but if your accounting firm chooses to go after new segments, you must ask yourself: Which segment should I target? And how should I segment the market for my needs?
This article will detail how to approach segmenting the market you serve and how you can use that to strategize your growth.
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What is Market Segmentation (for Accounting Firms)?
Segmentation is the practice of dividing your audience up according to a combination of behaviors, demographics, geographies, and other characteristics that allow you to differentiate them from one another. The idea of doing this is that you’ll be better able to target each segment with messaging that’s more relevant to them.
To put it another way, you wouldn’t approach a $100 million company with 1,200 employees the same way you’d approach a small single-owner business with 3 employees. Even though the services that you provide to each client can be similar, from their perspective, they have different reasons why they would hire—or overlook—your firm.
“Segmentation” Means You Understand Your Target Clients
Segmentation has become one of the main aspects of marketing with the prevalence of online marketing channels. That’s because every online marketing channel (particularly those that are pay-to-play) allows you to go very granular with segmentation. It’s come to the point where unless you’re clear on the segment you’re targeting, you may find that your digital marketing efforts don’t deliver the results you’re after. This is where the adage of “marketing for everyone is marketing for no one” rings true.
Note on B2B Segmentation: There are several challenges when it comes to business-to-business (B2B) segmentation.
The first one is making sure that the segments are actionable from a marketing perspective. Oftentimes firms can define a set of parameters to define the segment but realize that there’s no practical way of reaching them.
The second challenge is not making segmentation specific enough, which leads to poor messaging and an overall unresponsive audience.
How To Segment Markets to Find Ideal Clients
There are two broad levels of B2B segmentation (broadly speaking).
First, is the industry/market level—say your accounting firm identifies software as a target industry. Then, there’s a sort of sub-segmentation, which focuses on the individual(s) you’ll target within that industry.
So if your ideal clients are software companies, you’ll further segment to target decision makers, which are often operations (COO) or the founder (CEO) of the organization.
Find Your Firm’s Ideal Industry/Market
Think of the term “ideal client” when choosing a market. What do they look like? How much revenue do they bring in annually? What do they really need from an accounting firm? Which current clients are your favorites to work with? Your least favorite? (It’s okay—we all have them!)
All of these questions, along with some solid research, brings potential target markets to light. Things to consider include:
Firmographics: No, we didn’t make it up! Firmographics refers to segmenting your market due to the characteristics of a business you’d expect, like industry, annual revenue, size, employee number, etc. This type of segmentation is a great starting point since it can easily help you narrow down the field of possible clients. A great idea is to combine firmographics with psychographics to give you a more complete profile of your leads in the new segment you’re targeting.
Study your existing audience: Use your existing online audience to test messaging and learn about new opportunities. You may discover that the content you’ve posted online (blog, social media, email marketing, etc.) is relevant to a segment that you hadn’t considered. Pay attention to who’s engaging with your published content and visiting your website by leveraging tools like Google Analytics or other SEO and content analysis tools. These will help you uncover insights into which segments are interacting with your content and coming to your website.
Take advantage of audience insights tools (Facebook/LinkedIn): Facebook, Linkedin, and most social media networks that have business tools allow you to see who is reacting to your content. They even provide a snapshot of your following! This is a quick and easy way to create segments based on data about who your audience is and how they behave.
A great way to take advantage of this data is by promoting content on Facebook or LinkedIn to see how your audience reacts (that means boosting a post with ad dollars). A small investment in paid social media content can often give you plenty of data on how a new segment can react to what your firm offers.
Finding Decision-makers and Influencers within Organizations
“The one thing a lot of people don’t realize is that the same tactics for B2C apply to the B2B environment.” — Gary Vaynerchuck
If you’re selling, it’s to an individual; AI and machine learning aren’t able to tackle sales negotiations! So, in a sense, B2B accounting firms need to focus attention on the right people within an organization.
Let’s break that down into actionable steps:
Find the person who makes the ultimate decision: You want to get familiar with the person who has approval power. As a rule (with exceptions), it will probably be the same 1-2 roles in most companies in your target market. For example, the COO or CEO in recently funded software companies will likely make the decisions for an accounting service.
Then, find influencers around that person: These people may vary and can be more difficult to find than Waldo himself, but they’re the individuals who influence the decision maker. Continuing the software example, an HR person may love some help with payroll, so they can concentrate on rapid hiring. They can’t give the green light, but they can influence the person who does.
Work to understand both influencers and decision-makers: Buyer personas are essentially a brief file of relevant information about key people in a target market. For example, the HR person is overwhelmed with compliance, new-hire onboarding, paperwork, etc. Maybe a software COO wants to know how you can connect their business metrics to financials to improve performance. And a founder wants detailed forecasts and help preparing for another funding round.
Note: There are many details that go into a buyer profile/persona. Things like geography, related interests, biggest desires, concerns, etc. Anything that helps you understand their decision-making process.
Create content that serves, speaks to, and educates those individuals: Once you understand those you hope to contact, it’s time to work on what you’ll say to them (and how you’ll say it). This is where the file on your points of contact (influencers/decision makers) become vital.
There are dozens of content types, from whitepapers and webinars to blogs and sales messaging (ads, scripts, and so on). The key is filtering all of that content through your personas. Highlight the pain points, describe the benefits they want, and educate them on how your services solve problems while bringing success.
Will My Segmentation Work?
Whether or not you get the results you’re looking for depends on several aspects of your overall marketing strategy. If you segment your audience but don’t adapt your strategy for that segment, then you might find that the segmentation in itself doesn’t work as intended. It may be that the problem wasn’t the segmentation but lack of personalization in the messaging.
It’s important to keep in mind that segmenting your market (so you can find new opportunities) is part of a strategy. You’ll have to look at all the other elements like how to target them, how to measure success, even how to onboard them into your firm.
Are They Different in a Meaningful Way?
Even though the segments may seem different, the question you should be asking is if they’re different enough from each other. This is one of the main challenges when dividing your market segments. If you don’t have the tools to approach each segment, then the segmentation loses relevance.
The only way you can truly know the success of your segmentation is by generating enough data for an objective answer.
- Did you get the results you were after?
- Are your segmentation efforts increasing your total number of leads?
- Are you closing a higher percentage of incoming leads?
- Are clients in this segment responding positively to initial deliverables?
Focus On Your top-of-funnel Prospect List
Another area where you can look for data to segment your market is your top-of-funnel leads. Sometimes due to the nature of the B2B lead generation process, it’s impossible or impractical to create meaningful segments. This is where using your top-of-funnel prospect list for this data can be a useful tool.
Start with the Pipeline in Mind
Another approach to segmenting your market can be by thinking about the pipeline first. You can start building out your sales and marketing content by thinking about how you’d like your leads to enter your pipeline.
This approach works well if your marketing strategy is relying on inbound marketing or some other strategy that relies on generating leads through content.
Drive More Growth for Your Firm
Looking at new segments to fuel your firm’s growth can open up many opportunities that you hadn’t considered before. Being precise and intentional on how you generate new leads in the new segments you approach is what will ultimately determine how effectively you can obtain growth in the new market.
The good news is that you don’t need to change everything that you’re doing right now. You can run tests that will give you some data to validate your strategy and help you make an informed decision on whether or not investing in targeting a new market segment is right for your firm.
All that said, challenges abound with any growth-focused strategy. But that doesn’t mean you’re powerless in the face of them. In fact, you might have more options than you think when it comes to creating and executing a growth strategy, and we’ve laid out some of those options in a white paper entitled, “Overcoming the 5 Biggest Obstacles to Growing Your Accounting Firm.”
Click below to download your complimentary copy today!