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The Importance of Firmographics for B2B SaaS Marketing

12.12.2022 – Vineet Gupta

saas conversational marketing

The Importance of Firmographics for B2B SaaS Marketing

Your SaaS business marketing strategy is essential to its growth and success, however, it will be meaningless if it’s not segmented for the target audience based on the firmographics.

Confused what firmographics means and how it’s important? Let me help you out!

In this blog post, I’ll walk you through the firmographic meaning and its importance to B2B SaaS marketing so that you make your marketing efforts more productive. Let’s get started.

What Are Firmographics?

firmographic data

Firmographics, also known as firm demographics or emporographics, refers to the collection of descriptive attributes used by B2B companies to describe and segment their target market in order to discover their prospective clients.

It’s the corporate equivalent of B2B demographics, and it’s crucial when you want to speed up your lead nurturing process. 

While firmographic data alone is not enough for creating quality and relevant content for your audience, it is the first component of your segmentation process. 

In the B2B world, salespeople and marketers target business organizations and companies to promote and sell their products and services. 

Firmographics, therefore, helps you create company-customer profiles, augment buyer personas and place each prospective company into a specific firmographic segment according to their pain points and mutual characteristics.  

In a nutshell, firmographics help B2B marketing professionals differentiate many companies and identify the best fit for your solutions. This enables you to focus your money, time, and effort where it makes the most sense. 

That makes sense, right?

To better understand firmographic segmentation and its role in B2B SAAS marketing, think of how B2C businesses use demographics. 

The only difference is that while demographic data is used to segment customers, firmographic information is used to segment other businesses that can turn into customers. 

See the difference? But what is the importance of firmographics for B2B SAAS marketing? Keep reading to find out.

The Importance of Firmographics


The importance of firmographics for B2B SAAS marketing teams cannot be overemphasized. 

They provide marketing teams with information on the customers buying specific products and those who aren’t buying. Furthermore, they offer you a deeper understanding of your B2B clientele and the industry in general.

  • Firmographics reveal business insights. They help you understand your customers and answer commonly asked questions such as:
  • How many employees do they have?
  • Where are they located?
  • What’s the value of each business?
  • How large is the Total Addressable Market?
  • Firmographics help categorize firms by sector or industry. B2B SAAS companies segment their target market according to the customer base, geographic location, industry, technologies used, type of organization, customer base, etc. For instance, automotive companies will have different distinguishing attributes than construction firms or government entities.
  • Firmographics help businesses avoid lost opportunities. Employing a data-driven sales approach and optimizing marketing techniques help companies to reduce the risk of missing out on business opportunities. 
  • Firmographics help businesses understand data trends and statistics. B2B SAAS marketers can recognize data patterns by assessing reports and analytics from firmographic segmented marketplaces. This data allows marketers to identify and understand data trends and statistics. Moreover, these patterns can be considered in all marketing and sales operations, leading to increased efficacy. 
  • Firmographics help to optimize marketing strategies. A company can feel confident in its marketing strategy by promoting properly personalized and targeted messaging that corresponds with the pain points of each target market. Most B2B content marketers aim to send the right message to the right person at the right time, and using firmographic data helps them achieve that goal.  
  • Firmographics help you better engage and connect with your customers. Approximately 84% of customers say that being treated like humans is key to winning their business.  
  • Firmographics help you understand data trends to help in building your marketing strategy. Evaluating firmographic information enables you to recognize data and statistics trends, allowing you to customize your marketing and sales strategies to meet your potential customers’ needs. 
  • Firmographics help you to retain customers. When you understand the type of companies that are likely to purchase from you, you can predict their buying behavior. Consequently, you can come up with other solutions that cater to the needs of specific customers. 
  • Firmographics boost your sales and marketing ROI. Using firmographic segmentation helps you establish effective marketing strategies aligned with your sales efforts. This ultimately increases your sales and boosts your marketing ROI.
  • Firmographics save you time and money. Implementing firmographic segmentation is relatively low cost. Hence you can reach your marketing goals without breaking the bank. Additionally, it helps you avoid wasting time on irrelevant leads and focus your time and efforts on qualified leads.
  • Firmographics help you identify new target markets. Firmographic segmentation enables you to identify gaps and new customers and understand customer behavior.

Relevant Firmographic Data Used for Market Segmentation

B2B SAAS markets leverage countless variables to generate effective market firmographic segmentation. 

In fact, according to Gartner, approximately 60% of B2B sales organizations will have a fully adopted data-driven selling approach by 2025.

Let’s now look at the seven most prevalent firmographic data businesses use in their market segmentation.

  • Company size

Company size firmographics show how small or big the business is. Understanding the size of your ideal customer and segmenting them according to size helps your sales team stay focussed on converting them to paying customers. 

Because different-sized organizations respond differently to diverse messaging and advertising tactics, the number of employees, a company has matters. In addition, you’ll need to establish the number of locations and also the number of customers. 

From these parameters, you classify companies into

  • Micro companies – fewer than 10 employees
  • Small companies – 10-49 employees
  • Medium-sized companies – 50-249 employees
  • Large sized companies – 250 or more employees
  • Industry or sector

The industry type is one of the most common categories for firmographic segmentation because all organizations operate in at least one industry. 

It’s practical to group companies that sell similar products and services together. This will enable you to tailor your strategies to consumers’ needs and preferences in that particular industry.

For instance, a company in the transport industry that wants to invest in the latest automotive technology will have no interest in merchants selling construction supplies.

Therefore, grouping similar companies together is a more practical approach to filter out irrelevant industries than sending the same material to all and hoping that your message resonates.

  • Geographic location (country, region, state)

Where is this target company located geographically?- continent, country, city, state, region, climate, etc. You may also want to know, 

  • Is the target company an international brand?
  • Is it located in a major city or a small remote area?
  • What’s the distance between you and the target company?

Segmenting companies by location allows B2B SAAS marketers to deliver more personalized and relevant messaging to prospective customers in different regions of the world.

For instance, when your target audience is based in US, you need to follow US English, however, if it shifts to UK, the English to be used also must change to UK English.

  • Annual revenue

While money is always a controversial subject, revenue is a determining factor when it comes to firmographic segmentation. 

Why? Because you want to target companies that can afford what you’ve to offer rather than spending your money on prospective customers who can’t afford your offer. 

Research is essential. For instance, your software may be cheaper than competitors, making it more attractive to start-ups and small businesses with lower annual sales. 

On the other hand, a company that usually generates more revenue may be facing an economic lag, and your low-cost product may be appealing to them at that moment. 

  • Status/structure

The company structure or status refers to the relation of one company to another, but most often to its legal status. 

This information directly affects its spending requirements and objectives. It describes the company operating as follows:

  • Independent business
  • Stand-alone entity
  • A subsidiary of larger organizations
  • Partnerships
  • Privately owned company
  • Publicly owned company
  • Limited Liability Corporation(LCC)
  • Non-profit organization
  • Franchise of franchising company

Knowing the structure of an organization that will most benefit from your products or services can help improve the effectiveness of your sales, advertising, and marketing campaigns.

For instance, if you pitch a high-budget product to a small company, the pitch is most likely to fail, but if you use the same pitch for a large company, it will be successful.

  • Sales cycle stage

The information you provide to prospective customers should be tailored to where they are in the buyer’s journey. 

  • Are they ready to make a purchase, or are they just getting to know your business and exploring other possibilities?  
  • Are they contemplating your business as a viable option?
  • Are they in the decision stage and have chosen your company over competitors?

Understanding where your potential customer sits in the sales cycle helps you nurture and lead them down the sales funnel and can provide a foundation for B2B referrals

  • Performance over time

Firmographic segmentation by performance entails grouping firms together based on their business execution over time. It takes into account the following parameters:

  • Duration of existence
  • Profits and losses
  • Rate of growth or decline

Segmenting based on performance over time helps you understand a company’s current position and predict its future behavior, helping you boost your sales and marketing efforts. 

Furthermore, similarities in these parameters could indicate that the particular companies need a common solution.

The Bottom Line

Firmographic data is a must-have element for B2B SAAS businesses seeking to improve their lead generation funnel and customer journeys. 

Leveraging firmographic segmentation allows you to establish a successful sales pipeline to get steady traffic and qualified leads. Furthermore, you can use it to improve your approach at any point along the buyer’s journey, creating more effective personalization and increasing sales.

Instead of using a one-size-fits-all approach, B2B SaaS companies will provide their prospective customers with what they need resulting in increased sales and ROI. 

If you understand the importance of firmographics for B2B SaaS marketing teams, you’ll use segmentation to nail down your Ideal Customer Profiles(ICP).

With the above information, we hope you employ firmographic segmentation to create a profitable and successful B2B SaaS sales pipeline.

Found this information helpful? Let us know what you think in the comment section. 

Post by Vineet Gupta
December 12, 2022