The Power of Customer Market Segments in CX execution

Every GTM strategy defines specific target market segments that the company believes are the best markets for them to focus on to grow the company. It would seem logical that these market segments are the same customer market segments that should be used in the post sale side of the customer experience. I was asked recently if any consideration should be made to market segmentation strategies in a Customer Experience model. The simple answer is “Yes”.

There could be many advantages to utilizing a more detailed market segment within the CX organization. However, I would recommend aligning CX segmentations within the target markets defined in the corporate GTM strategic plan.

The benefits of further defining market segments within the CX customer experience strategy are as follows:

1. A comprehensive customer roadmap plan can be defined as the guide for a customer to operationalize the solution across the entire company with specific high value outcomes by phase.

2. The roadmap plan can include a best practice approach to innovate and revolutionize the customer’s business operations.

3. A specialized methodology can be developed to guide customers from where they are today to a fully operationalized solution in a short period of time.

4. Specific KPIs can be identified to confirm real customer business ROI.

5. Drive customer heroes, success stories and references.

How to consider if a CX customer market segment is appropriate

If the company GTM strategy has defined the market segments as only Enterprise, Mid-Market and/or SMB with a few targeted roles defined, these may be too general for CX to define a detailed strategy for ensuring all customers in the market segment operationalize the solution setting up a secure renewal and future expansion.

To determine if CX should create a next level of segmentation, it requires the CX team to define what it means to have the solution fully operationalized for a customer within that market segment. Most SaaS companies define slightly modified onboarding or customer experiences for each segment, but really end up just showing the customer how the software works and then leaving it to the customer to figure out how to operationalize the solution. The purpose of further CX segmentation allows the SaaS CX team to define a best practice on how a customer sets up, configures and uses the software in their day-to-day operations to improve their company’s processes or development and delivery of their products or services.

Once the CX team has a clear vision and definition of what the customer’s end game should be, they can determine if they need to build a best practice approach. This approach may require a methodology with innovative programs and/or a specific approach to show customers how to operationalize the solution for a particular market segment.

For example, if the software is a Work Management solution, it may be helpful to further segments beyond the company GTM market segments, if they are only defined as Enterprise, Mid-market or SMB. The Enterprise market segment could be segmented further by industry, process and/or department. With a CX market segment to Industry, Department and process it enables the team to create a best practice to operationalizing a work management solution for optimizing a development process function within an Engineering department for a technology company.

Another consideration is whether a more specific customer roadmap plan can help deliver a higher value that is meaningful and trackable. If there is enough differentiation, it may improve CX execution results by building a separate Customer Lifecycle Model (CLM) for each market segment defined.  

For instance, if the best approach to operationalizing a work management solution for each department and set of processes or standards within that department are significantly different, then it may be best to consider a market segment for each department and/or process solution.

The key elements to consider segmenting a market are:

1. The solution optimizes a process that is defined differently by each industry and/or department

2. The solution optimizes different workflows that vary by industry or department 

3. Compliance requirements that vary by industry or process

4. Security compliance requirements

5. Reporting requirements

If a separate Customer Life cycle model is required, it will allow the definition of a more specific customer experience that meets the customer’s needs from the buy cycle through the implementation and expansion stages. By having a separate CLM model, a very specific customer roadmap plan can be defined to guide customers on how best to go wall to wall with the solution and execute faster and achieve better results with a significant ROI.

How does a CLM by segment improve execution?

For each market segment, it’s important to walk through defining each stage of the CLM and evaluate the differences from the current approach and the approach required to deliver on the requirements for a specific market segment.

What teams will discover is how specific the team can get on defining a well-planned, detailed onboarding and implementation plan that will guide a customer from current state to the vision state in a shorter period. It enables the CX team to develop best practices and thought leadership to coach the customer on how to get to the high value outcomes and end game that revolutionizes their current operations.

The CX team will be able to design a long-term customer roadmap by learning about the customer’s business operations, organizational structure and annual strategic goals as part of the best practice methodology. This visibility into the entire scope of an opportunity within the customer will allow the CX team to design a customer roadmap plan that delivers value in each phase that includes a roll out the solution across the entire company in a logical approach with the high priorities well established. This sets up the expansion opportunities to ensure the lifetime value is achieved.

From the Customer Roadmap plan the CX team can get the customer’s sponsors and team committed to the plan including resources and budget to support the execution of the plan. The CX team can break the customer roadmap plan into phases with specific deliverables and high value outcomes where each phase delivers measurable value. Each phase can build on itself, helping the customer to have a well-defined guide to follow in rolling out the solution.

With a specific plan and designed solution, the CX team can help the customer identify specific KPIs to monitor or recommend the customer to begin tracking these metrics to prove a business case for the value the solution is providing and continues to provide.

A specific plan also enables the CX team to develop a unique best practice and design a special program for customers to implement that can create new innovative processes and procedures supporting the customer’s ability to achieve a competitive edge.

A special partnership can be nurtured to help the customer become heroes within their organization and become champions sharing their success at User Conferences and other marketing events developing a long-term reference.

In summary, considering further CX segmentation beyond the company GTM segments defined can help the CX team to plan, design and execute on a customer roadmap plan that leads the customer to the vision of operationalizing the solution in a short period of time. The plan can deliver realized value following a set of best practices that can optimize the customer’s business operations and competitive edge ensuring customer partnerships for life.

As always, your thoughts are welcome. If you would like help in considering segmentation to improve customer entrenchment with your solution, please contact us at [email protected]. We offer a workshop to help develop a segmented strategy and operational execution plan.