When SaaS Marketing Segmentation is a Bad Idea

By Justin Talerico

Jan 30 2019

Everybody knows SaaS marketing segmentation is good. And everyone thinks they need to do it. It makes messages more specific. It improves relevance, which in turn accelerates lead-to-revenue velocity. I personally love segmentation and have been using it extensively in SaaS marketing for over a decade. But it’s not always a good idea. And even when it is, too much of it can be detrimental to the very things it’s being employed to improve.

SaaS Marketers are Busy

The problems with segmentation start with a simple fact: SaaS marketers are very, very busy. That doesn’t mean they’re doing the right things, but they’re definitely doing a lot of things. They don’t have extra time. Heck, most SaaS marketing is fair-to-poor quality, which suggests marketers don’t have enough time or resources to produce quality work at all. This is often the state of the function when segmentation is added on top of the already-enormous pile of things to do. And at least as often resources are not added to fulfill the additional work to be done. That’s a recipe for mediocrity (at best).

Segmentation Means Multiplying the Work

SaaS marketing segmentation means identifying and putting like people or personas into buckets and making the marketing to each bucket more specific and more relevant. Relevance breeds results, so it’s fruitful any time we can get more specific. 

The problem goes back to time, resources and expertise. Authentic relevance comes from domain knowledge that takes time and deep expertise. It’s like vertical marketing (the highest level of segmentation) — if you don’t do it all the way, you’re sniffed out as a poser and doomed to fail. 

You’re better off staying out of verticals — and segmentation — if you can’t execute authentic, knowledgeable content for each segment.

Most marketing teams are ill-equipped to tackle the realities of producing highly specific versions of their content. It’s not only multiplying the work, but it’s also putting higher demands on the quality of the additional work. 

Think of it this way — the basic, generic messaging that’s wrapped around a SaaS is pretty straightforward. Yes, understanding the buyer and context is important to make engaging content. I’m not diminishing that. But it’s honestly more often about the SaaS than it is about the buyer. 

When you segment, it’s all about the fit, which means it’s all about the buyer’s business and their context — things the buyer knows intimately and things you cannot fake or gloss over. You have to know or your content will do more harm than good. This is, by the way, why so much solution marketing is unengaging — it’s surface level and so perceived as inauthentic. It’s got no value for the buyer.

Changing a Word Isn’t Creating Relevance

Now we’re getting to the meat of the problem. There’s a lot of segmentation for segmentation’s sake. So let’s get back to why we’re putting in all this additional effort — the reason for segmentation is relevance. Most B2B SaaS marketers make segmentation much easier than it actually is. As a result, they get no results. But they just keep doing it. 

Far too often a segmented nurture email is actually identical to the generic version with a few adjectives changed. That’s not relevance. That won’t even be noticed. In fact, those words are likely being skimmed over as you read this. It’s a big, fat, fail. And it’s a far cry from relevance. So why do it? So you can say you’re segmenting? That’s an utter waste of time and resources.

Too Many Segments are Seldom a Good Thing

One more way I see marketing segmentation go sideways is in sheer quantity. I have a simple rule — if we have something truly differentiated to say to a group, then we should segment them and say it. The planet-size caveat is that there have to be enough of them to make the outcome worth the effort. How many is enough to warrant the effort is completely dependent on your market size and deal size. It’s also dependent on the scope of the effort. If you’re going to produce four highly relevant nurture emails, that’s a lot less effort than producing an entire end-to-end segment-specific program.

A huge driver of how many are in a segment is how specific the segment is. For example, segmenting on industry is pretty high level. Same with segmenting on role -or- business size. But segmenting using -and- instead of -or- gets dicey fast. Take those same three axes — industry -and- role -and- business size. If you have three industries, three roles, -and- three business sizes, you have 27 segments. That’s likely too many. Or at least too many to execute well.

Relevance is the holy grail of content marketing, but it doesn’t come easy.

Baby Steps to SaaS Marketing Segmentation Success

In my experience, the path to successful SaaS marketing segmentation takes baby steps. I always started with one significant segment, not three or ten. We’d then execute really well against that one segment; get better at it through iteration and testing; evaluate our results versus investment; and then decide if and what the next segment should be. Each one was methodical, thoughtful, strategic, and deep. We would only do it if we could speak with authentic relevance. When we were perceived as the authority, we were successful. When we missed on that, it was a failure.

SaaS marketing should not be about activity or busy work. Effective SaaS marketing — the kind that lowers CAC and creates capital-efficient growth — is fundamentally authentic. If you can’t bring that level of authenticity to segmentation, at least bring it to your generic messaging. Relevance is the holy grail of content marketing, but it doesn’t come easy.

Content by Beacon9 SaaS Business Advisory

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