We've made money for SaaS startups like...
You can't be all things to all people.
Yet when it comes to startups, too many founders have too broad of a target customer. If you’ve fallen into this trap too, then your growth has likely slowed down.
Why is market segmentation so powerful in creating a 10x product?
Market segmentation strategy allows you to:
- Constrain your messaging to better resonate with your customers.
- Focus your positioning to improve conversions while cutting your marketing costs.
- And optimize the product features to build a truly 10x product.
What’s a 10x product, you ask? And how does market segmentation help you create a product that’s superior to your bigger competitors?
In 1976, Kodak had 90% of film sales and 85% of camera sales in the USA. (1) With profit margins as high as 80%, some considered Kodak the Google of its day. (2)
At its peak, Kodak sold 10x products because each product was for a big market and had high profit margins.
Fast forward to 2012. Kodak went from the king of the photo world to filing bankruptcy. As digital cameras roared onto the scene, film soon became extinct. Add an additional rush of smartphones to the market and film became a footnote in tech history.
How does a market segmentation analysis allow you to create a 10x product and avoid the startup graveyard?
Believe it or not, the first digital camera was invented in 1975… by a Kodak engineer.
The inventor, Steven Sasson, presented his invention to management. After one look, the powers-that-be told Sasson, “That’s cute, but don’t tell anyone about [the digital camera].” (3)
Like many successful founders, Sasson’s product had a small but passionate group of people who loved his idea. (3)
But Kodak had millions of customers. It’s likely Kodak managers missed the signal from the noise because they lacked market segmentation.
Market segmentation is the process of finding the small group of customers who *love* your product.
With market segmentation, Kodak would have realized that the digital camera was the next 10x product. Their customers would have told them everything they needed to know to perfect the digital camera before anyone else.
Instead, Kodak buried their heads in the sand, ignored their customers, and died a slow and painful death.
For you, finding this core growth of early adopters is critical to your success.
Why? Because it's easier to expand the number of customers than improve customer satisfaction. And once you understand these customers, it’s easier to find more customers like them.
You’ll find this same advice given at Y Combinator. They’re the startup seed accelerator that funded Airbnb, Stripe, Segment, and over 125 startups valued at $150 million or more. (4)
Had Kodak used Growth Ramp’s market segmentation services, we may have been able to scale the digital camera’s growth from a handful of customers…
Yes, we only serve SaaS clients.
But the principles of successful segmentation are still the same. Market segmentation will help you find your product’s place in the market and then dominate it.
Here’s how Growth Ramp might have helped Kodak find product-market fit (PMF) and turn the digital camera into a 10x product:
- Survey and interview Sasson’s friends who used the digital camera. The goal is to understand the buyer journey of the small group of customers who love your product. For your product, we’ll survey and interview your customers to find out which customers we should first target. These insights will allow us to build your brand positioning, pricing, and go-to-market strategy.
- Survey and interview Kodak customers. By talking to Kodak’s larger customer base, we’d find the patterns of what’s needed to create the next 10x product. How does this apply to you? You may be thinking, “I don’t have millions of customers like Kodak had.” This is true of all startup founders that work with Growth Ramp. But if you have an email list, freemium users, or free trial users, these are potential customers worth surveying too.
- Segment the research. Regardless of the number of customers we survey, we need to find the signal in the noise. Our goal in this step would be to help Kodak know which of their customers love their product. For an early-stage startup, we’ll invest in qualitative research to find what’s missing to turn your passive customers into loyal fans. This will allow you to increase your word-of-mouth, the holy grail of marketing.
- Synthesize the research and prioritize growth opportunities. Large amounts of data wouldn’t do Kodak any good without an actionable plan. For you, we’ll synthesize what we’ve learned into an actionable growth strategy. Afterward, Growth Ramp will prioritize your strategy based on what will most likely get you results faster.
- Execute the growth strategy. For Kodak, that strategy would convert customers of other products into raving fans of the digital camera. For you, we will put your positioning, pricing, and go-to-market strategy into action to get 1,000 customers in a year.
If you want to carve customers away from the existing market, then you need Growth Ramp’s market segmentation services. Apply to hire Growth Ramp today.
Ben Leavitt, CEO of Decibite
"Growth Ramp’s strategy more than doubled our annual recurring revenue (ARR) in 6 months... They pushed us further in one month than a year on our own..."
Before we started with Growth Ramp, we had no idea who our target customer was. Marketing has been a frustrating process for us at Decibite.
Growth Ramp interviewed our customers, did market research, showed us where we were, and who we wanted to help. Growth Ramp then executed the strategy which more than doubled our ARR in 6 months. This was a huge game-changer. They did everything that we were wanting to do and more. This was a huge weight off my shoulders and helped me avoid burnout.
Growth Ramp got us back on track and their efforts have pushed us further in one month than a year on our own. Working with Growth Ramp was like riding on a couch getting pulled behind a ski-doo. Sometimes you’ll get a little snow on your face, but it was the exciting ride we were looking for.
6 Month Results:
- ARR: +127%
- Total Monthly Traffic: +241%
- Monthly Search Traffic: +331%
Let Growth Ramp’s marketing experts do the heavy lifting for you to get 1,000 customers in a yearApply to Hire Growth Ramp
Want to learn how market segmentation fits our product marketing process to help you get 1,000 customers in a year?
Here’s a 18 min. overview of our product marketing methodology 👇
Stop dealing with marketing by yourself. Work with Growth Ramp, an agency that knows strategy better than you do...Apply to Hire Growth Ramp
Brenden Mulligan, CEO of Podpage
“After the price increase campaign, we’ve been adding new customers at the same growth rate. I made my money back in two months as Growth Ramp promised…”
Marketing hires are very hard. Everyone I talked to told me I needed at least six months to start seeing results. None could prove to me they understood my market, my product, or my customers.
When I approached Growth Ramp, I was coming in cold. But they estimated I could make it all back with a price increase campaign in two months.
In two months, I got data from my customers on my pricing, why some weren’t buying, what features to add for a new price plan, and so much more. If I were to hire a general manager or CMO, I’ll use Growth Ramp’s research to ramp them up. They then handed me everything I needed for the price increase campaign on a silver platter.
After the price increase campaign, we’ve been adding new customers at the same growth rate. We didn’t lose a single customer from the price hike and customers did not question the change. Furthermore, I made my money back in two months as Growth Ramp promised.
I don’t think enough founders are focusing on pricing to optimize their growth strategy. You may have a gut feeling about the right price of your product. But without data, you’re likely leaving money on the table.
Market segmentation tactics and techniques to get you 1,000 customers in a year
- New product positioning.
- Psychographic segmentation (by purchase decisions).
- Demographic segmentation (by demographic data).
- Geographic segmentation (by location).
- Customer segmentation (by personality traits).
- Customer retention segmenting.
- Marketing mix survey.
- Benchmarking and metrics.
- Improve brand loyalty for current customers.
- Strategic customer segment pricing.
- Hyper-targeted marketing campaigns.
- Optimized product offerings customer groups.
- New market analysis.
- Niche market selection.
- Target audience profitability analysis.
- Potential customer marketing segmentation.
- Qualitative decision-making.
- Personalized marketing messages.
- Digital marketing strategy.
- ROI-focused growth.
Growth Ramp is a product marketing agency that makes SaaS startups more money faster and get 1,000 customers in a year...Apply to Hire Growth Ramp
Ronit Epstein, ex-Director of Marketing at Yotpo
"One of the most SEO-optimized articles on our site…"
When it comes to getting more traffic, Jason and his team are one of the first we turn to. One of Growth Ramp’s articles was one of the 7th most SEO-optimized posts for Yotpo after two months.
Can I give you some advice? Hire Growth Ramp before your competitor does.
More product marketing services we’ll use to help you get 1,000 customers in a year
All the services you’ll get so you don’t have to deal with the marketing headache when you hire Growth Ramp...
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What you need is someone to look over your shoulder. Someone who can do a positioning analysis and smack you in the face to tell you that you’re shooting yourself in the foot. Learn more about our positioning analysis process →
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If you want consistent growth, you need to partner with an agency that knows the right go-to-market strategy better than you. Learn more about our go-to-market strategy services →
Johnathan Dane, CEO and Founder of Klientboost
“Over 20% increase of client leads worth $25,000 or more…”
Do you know when you're super excited to finally stay consistent with your blog? And then someone like Jason comes around, smacks you in the face, and tells you when you're shooting yourself in the foot?
I didn't believe Jason at first, but we saw an increase in over 20% of inbound client leads that have LTVs of $25,000 or more. If you're not promoting what you sweat to create, then you won't get as far as you can.
3 Month Results:
- Inbound Leads: +20%, with LTVs of $25,000+
- Social Media Traffic: +191%
- Total Monthly Traffic: +88.9%