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The ultimate guide to firmographic segmentation

Woman standing over a table while looking at a laptop screen and writing on a notebook

B2C marketers use demographics to describe their market segments. B2B marketers need data that describes businesses instead of consumers, or firmographics. B2B marketers collect firmographic data that defines their target market and includes their industry, number of employees, legal status, company size, financial standing, and other business-related variables.

Marketers collect firmographic data from multiple sources. Publicly available information will list business names, industry categories, location, estimated annual revenues, and company leaders. This low-cost approach provides valuable market insights, but the data may be outdated or not detailed or relevant enough. 

Marketers also use surveys to collect data. Survey results include current information about the company’s status. Since the business environment changes rapidly, surveys are a great way to collect fresh and relevant data.

For B2B marketers, firmographic data is a must-have marketing tool to identify their target market.

It’s easy to use our Audience Panel to pick your audience, send your survey, analyze your results.

What if a marketer’s ideal market is small tech start-ups in Atlanta? Or large commercial bakeries in Minnesota? Each of these segments has unique characteristics and buying patterns that marketers want to know. Marketers use firmographic segmentation to classify their customer markets.

B2B marketers research companies by their industry, size, location, and other factors to better understand their markets. This segmentation approach helps them properly position their products and services to their ideal market.

Firmographic segmentation variables include a business description, financial performance, and industry insights as major categories with unique variables for each type. B2B marketers are now combining firmographic data with other types of data to improve their segmentation efforts.

Industry classification - Businesses are classified by the Standard Industry Classification (SIC) or North American Industry Classification System (NAICS). Marketers can search the NAICS website for both SIC and NAICS codes, including business size and metropolitan areas.

Ownership and Legal Status - Businesses come in all categories, including sole proprietorships, limited liability corporations (LLCs), limited liability partnerships, private corporations, and public shareholder-owned corporations. Businesses within an industry may also be part of a franchise or owned by a larger parent company. Marketers may be interested in not-for-profits or government organizations. Each type of business will have its unique characteristics to consider. 

Years in Business - Are you targeting a new startup or a mature organization that has been in business for a long time? The number of years in business will provide clues about their financial strength and experience.

Number of Employees - The number of employees will indicate the type of business - small, medium, or large. Marketers want to know if a company is brand new with a few employees, a small and medium-size business (SMBs), or a large enterprise to target their marketing efforts better. 

Location - Businesses may have one location or hundreds of offices aroun