Using Market Segmentation to Generate Sustained Growth
Are you wasting sales and marketing resources going after the wrong leads? Many language service providers (LSPs) aren’t sure which prospects to pursue, so they market to a broad spectrum of buyers, with little in common, and which cross company sizes, industries, geographies, and countless other attributes. The more LSPs struggle to grow in a predictable fashion, the more they talk about hiring additional salespeople, redesigning incentive plans, and going after any prospect – good or bad.
CSA Research identified in advisory sessions that even the largest suppliers need guidance to develop a more strategic approach to targeting buyers. To equip LSPs with the tools to succeed, we analyzed the methods used by sales and marketing executives at successful language industry providers. We also drew on best practices from other fields to provide a step-by-step segmentation approach to guide anyone responsible for branding, marketing, sales, or account management to optimize the use of limited resources, market more effectively, and better service current customers.
An essential element of success in proper lead targeting lies in segmentation. It’s an exercise to identify the subgroups of companies to target. You narrow down the opportunities that would benefit the most from your services and in turn pre-qualify your prospects. You end up with tiers of prospects, which each involve a different approach:
- Tier 1. These hot prospects match your segmentation criteria and are aligned with your firm’s differentiation. The best practice is to allocate your best resources and salespeople to Tier 1 leads.
- Tier 2. These companies match some of your criteria and align with what your firm does well, but they are not today’s primary area of concentration. As candidates for Tier 1, you should market to them. If you have less experienced salespeople on your team, have them call on Tier 2 prospects.
- Tier 3. These prospects represent a longer-term opportunity. For example, include them in your direct marketing with the ultimate goal of moving them to Tier 2. To keep such firms aware of your offerings, allocate these accounts to junior business development resources.
CSA Research’s latest report called “Effective Market Segmentation” covers the critical aspects of effective market segmentation, from list building to segment modelization, validation of market segment decisions, all the way to sales and marketing deployments advice. We thread throughout the report a concrete case study of how we, as an organization, have deployed segmentation to help our own marketing and sales efforts.
LSPs without a segmentation model disperse waste time and energy on unfocused marketing and pursuing accounts or prospects that have a low potential and/or profitability. While you have to invest ahead of seeing results, this structured approach detailed in our independent research report will enable LSPs of all sizes to bring desired revenue in a more consistent manner than through random campaigns and calling.
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