What is Firmographic Data? And How Does It Support ABM?
Why bother about firmographic data?
Because even the most experienced marketing teams with the best tech stacks struggle to win B2B clients. There are so many different factors to consider: different decision-makers, purchasing approvals, budget restrictions, or potential egos at play.
The more your teams understand their target accounts, the more likely they’ll convert into paying customers, and firmographic data is the place to start!
In a recent Rollworks study, 73% of marketers said they saw an increase in average deal size, specifically in ABM accounts, when they focused on the quality of leads over quantity. That’s what firmographic segmentation can do for you.
Let's explore how this resource can add more purposeful decision-making to your marketing strategy!
What is Firmographic Data?
Firmographic data provides detailed characteristics of organizations, including industry, size, revenue, and structure. Very similar to demographics used in B2C marketing, these data points are unique to the B2B world. B2B marketers will use these data points to segment their markets just like B2B marketers would!
Sarabeth McCarthy, a Senior Data Insights Client Relations Partner at Gartner Digital Markets, claims that combining firmographics with leading ABM practices such as ABM personalization helps focus your marketing and sales efforts at companies that are more likely to convert.
She uses the example that if your ideal customer is a small business in the healthcare industry, you can use firmographic data to target your marketing and sales efforts at companies with similar demographics.
Firmographic Data vs. Demographic Data vs. Technographic Data
We’re surrounded by data nowadays, so how do we know which to use? Let’s see how firmographic, demographic, and technographic data compare to one another:
| Firmographic Data | Demographic Data | Technographic Data |
|---|---|---|
| Focuses on organizational attributes. | Focuses on individual characteristics. | Focuses on technology usage and preferences. |
| Includes company size (i.e., the number of employees), industry, market share, revenue, ownership structure, and organizational hierarchy. | Includes age, gender, income, geographic location, education level, and job title. | Includes software tools, platforms, and IT infrastructure. |
| Helpful for learning about the characteristics and structure of target companies. | Helpful for creating customer personas or ICPs. | Helpful to help tailor messages based on a company's tech stack and digital footprint. |
Now that we know the key differences between these different types of data, what makes firmographics so helpful?
Why is Firmographic Data Important in ABM
According to Foundry, accurate firmographic data is one of the main pillars of any effective account-based marketing and sales strategy.
In ABM, brands are expected to provide a consumer-like experience, and personalized content is necessary to achieve that. That’s where firmographic data comes in.
Improves Account-Based Market Segmentation
Firmographic data improves account-based market segmentation by providing data points such as industry, company size, revenue, and location. You’ll be able to develop more precise segmentation strategies for the needs of target accounts.
HGInsights gives the example that you may shift how you market if the target business is largely staffed by millennials.
To stay up to date, consistently analyze and update your segmentation criteria based on your new firmographic data to keep in alignment with your marketing goals.
Improves Quality of Target Account Lists
You can also use that firmographic data to ensure that target account lists are well-defined and aligned with your ideal customer profile (ICP). High-quality target account lists will directly impact campaign effectiveness and ROI.
For example, MadisonLogic gives this example: if your biggest deal of $200,000 is from an account in the energy sector with 1,500 employees, there may be similar accounts that you can target with similar messaging and content.
Regularly review your target account lists based on your firmographic data. Prioritize the companies that are your ideal customers! That way, your marketing and sales teams are focusing on accounts with the highest conversation potential.
Improves Understanding of ICP
Using firmographic data will also give you a better idea of your ideal customers and what they want. When you understand your customer better, your sales team can come to their calls better prepared!
Continuously refine your ICP to ensure it reflects the characteristics of your most valuable and high-potential accounts. Use your firmographic data to find common patterns or traits among your best customers, which will help you tailor your ABM efforts to attract and engage similar customers.
Personalized ABM Content Strategies
Firmographic data helps your marketing team understand the needs of target companies, which will help them tailor messaging, offers, and content formats to match the preferences and challenges of each market segment.
A recent Salesforce report found that 84% of consumers and 83% of businesses say that being treated like a human being rather than a number is the key to winning their business. Personalized ABM will help your consumer feel like a person, not a number!
Generates Business and Industry Insights
The firmographic data also provides business and industry trends by providing more data on industry verticals, company sizes, geographic locations, revenue trends, and more.
Using this data, you’ll refine your ABM strategies to better differentiate yourself from companies in direct competition and identify new opportunities for growth!
How to Gather Firmographic Data
Firmographic data is best gathered through these three methods:
Online Searches
Conducting targeted online searches is a great way to gather firmographic information. Best practices include:
- Utilizing advanced search operators to refine results.
- Leveraging industry-specific directories and databases.
- Verifying data points from multiple credible sources.
Customer Surveys
Asking your customers directly through surveys yields even more accurate data. Best practices include:
- Crafting concise and relevant survey questions.
- Offering incentives to encourage participation.
- Survey data needs to be anonymized and compliant with privacy regulations.
Purchase it From a Third Party Data Provider
Third-party data providers offer massive firmographic datasets for purchase. Best practices include:
- Researching and vetting data providers for reliability and accuracy.
- Verifying the freshness and relevance of the data sources.
- Ensuring compliance with data privacy regulations and industry standards.
How to Verify the Quality of Third-Party Firmographic Data
| Consider | Definition | Things to Lookout For |
| Accuracy | The reliability of the data provided and how up-to-date and current it is. | Check for any data validation processes or certifications the provider adheres to. Look for customer reviews or testimonials regarding data accuracy. How often do they update their data? Verify if the provider offers real-time or near-real-time data access. |
| Scalability | The ability of the data provider to accommodate growth and changes in your business needs over time. | Inquire about the scalability of the data solution and its ability to adapt to changes in your business or market dynamics. Are there scalable pricing plans or solutions for expansion? |
| Integration | Compatibility and ease of integrating third-party data into your existing systems or platforms. | Inquire about integration APIs, data formats, and compatibility with your CRM, marketing automation, or analytics tools. Is there technical support for integrating the data? |
| Historical Data | Availability of past data records or trends to analyze historical patterns or behaviors. | Is there availability of historical data sets? How deep does that data go? Assess the relevance and reliability of historical data for decisions and predicting future trends. |
Types of Firmographic Datasets
Understanding key aspects of businesses, including their size, industry, financial performance, ownership structure, organizational setup, and growth trends should inform your ABM strategies. Let's explore different types of firmographic data points and how to use them with lead generation:
Company Size
Company size categorizes organizations based on metrics like revenue or employee count. Best practices for gathering this dataset include:
- Using tools like company databases and market research reports.
- Segmenting target accounts based on their size to tailor outreach efforts accordingly.
For example, a smaller company may focus on price points and automation as it scales up. Comparatively, a larger company needing enterprise solutions may be concerned about integrating the solutions into its already functioning systems.
Industry
Industry categorization classifies companies into specific sectors or verticals. Best practices for gathering this dataset include:
- Utilize industry classification systems like NAICS or SIC codes.
- Researching industry trends and challenges to inform messaging and content strategies.
For example, if your B2B company is in the healthcare space, make sure you use up-to-date healthcare language and tailor your messaging to address current challenges.
Company Financial Performance
Financial performance data provides insights into a company's fiscal health and growth trajectory. Best practices for gathering this dataset include:
- Accessing financial databases and reports from reliable sources.
- Identifying financially stable and high-growth companies for strategic targeting.
Your company may want to target high-growth companies! Financial reports help you to identify firms with strong revenue growth and healthy balance sheets. The team can tailor the solutions presented to address the company's specific needs, offering tools to maximize profitability.
Ownership Structure
Ownership structure shows the ownership relationships within an organization, such as public, private, or subsidiary status. Best practices for gathering this dataset include:
- Examining corporate filings and ownership reports.
- Tailoring engagement approaches based on the unique dynamics of each ownership structure.
This could show up if you target a publicly traded company’s subsidiary. You can use your firmographic data knowledge to highlight how your B2B solution brings shareholder value or aligns with their corporate standards.
Organizational Structure
Organizational structure refers to the hierarchical layout and reporting relationships within a company. Best practices for gathering this dataset include:
- Analyzing organizational charts and LinkedIn profiles.
- Understanding decision-making processes and key stakeholders within target accounts.
For example, knowing that the CTO of a prospect account oversees the technical specifications of any new software purchase, the marketing team can tailor its messaging to address technical benefits and ROI, while the sales team focuses on relationships with stakeholders in the other departments of the organization.
Industry or Category Growth Trends
Category and industry growth trend data highlight industry-specific growth patterns and market dynamics. Best practices for gathering this dataset include:
- Monitoring industry reports and market research studies.
- Identifying emerging trends and opportunities for strategic positioning and messaging.
You may look for opportunities for strategic partnerships or alliances with industry players that are driving trends. Collaborating with complementary businesses can expand your reach and credibility within target industries, giving your sales team a boost of confidence in their outbound calls.
Mastering Firmographic Data For Future Success
71% of customers expect companies to deliver personalized and tailored interactions, according to Rollworks, and firmographic data is just one critical aspect of market analysis that will help you create personalized content for your potential clients.
You have your checklist of what to look for when sourcing data sets, what data could be beneficial, and how to use it in your ABM strategy. Using your “insider knowledge” (i.e., firmographic data), you’ll know exactly who you’re talking to, what they want, and the value you can bring them!
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