As the conceptual similarity already suggests, the term firmographics basically describes something like demographic data – only for companies instead of for persons. In Germany, this term is still relatively uncommon, although many of us use firmographic classifications on a daily basis.
The purpose of firmographics
Firmography allows marketers in the B2B context to describe and subdivide their target groups in a similar way as B2C companies do with the help of demographic variables. Instead of age, place of residence and net income, a companyographic categorization uses variables that make sense for grouping and segmenting companies.
Some of the most common firmographic dimensions:
- number of employees
- legal form
- group affiliation / independence
- profit / loss
By grouping them together on the basis of relatively simple characteristics, companies that are similar in certain respects – based on the assumption that they will also tend to be similar in their needs – can be quickly and effectively grouped together. Firmographics therefore allow a quick, rough target group description.
Boundaries of firmographics
Just as demographic data in B2C marketing can only ever describe a small part of a person schematically, company geography as a target group determiner quickly reaches its limits. Because the grouping on the basis few variables remains in each case extremely roughly and stereotyped. The target group can be reduced so very fast to a small part of all existing companies, but still the companies within this group will show substantially more differences than similarities. Firmographics are therefore only suitable for very superficial segmentation.
Only the amount of data adds depth
With each additional variable you use to differentiate your audience from all other companies, you will increase the similarity of the companies in that group. So in order to target your budget and tailor messages precisely to the specific needs of your potential customers, you need a sufficient amount of firmographic data.
You can use the Implisense Pro database to accelerate their research and application. Filter by hundreds of daily updated data points and narrow down your target group with just a few clicks. Based on relevant criteria that match your product or service. You can also simply turn the tables – and learn more about your target group: Enter some of your existing customers and let Implisense Pro determine in which firmographic sizes they are the same or similar. This will tell you which variables are actually relevant to the description of your target group – and you can automatically have other companies that match this profile suggested to you.
Determine the really relevant firmographic variables and use firmographics in a systematic way to segment your target group.