To help you better understand the most effective frameworks and analysis methods for segmenting your TAM, we reached out to CEOs, founders, and other industry professionals for their insights.
From segmenting around pain points to employing the “Pizza Slice Model,” discover the top 10 go-to frameworks and analysis methods shared by these experts to optimize your SaaS and tech marketing strategies.
Segment Based on Pain Points
We segment our target audience based on their pain points. Using the pain point framework from HubSpot, we identify the primary pain points our customers are facing. Then we can focus on messaging that speaks to those pain points and how our product can address them.
We then segment based on those pain points so we can send more targeted, relevant emails and content to customers at different stages of the buyer’s journey. This helps us get more leads and conversions at each stage.
Answer Customer Stage Questions
As someone who has worked in various industries, I’ve learned that the key to success is understanding your audience. That’s why the customer journey stage is one of my go-to frameworks when analyzing and segmenting my total addressable market (TAM).
By understanding where customers are in their journey, I can tailor my approach and messaging to their specific needs and pain points. Are they in the awareness stage, discovering a new problem? Or are they in the consideration stage, weighing their options?
By answering these questions, I can deliver better value and ultimately convert more prospects into customers. So, if you’re looking to make strategic decisions and drive growth, start by focusing on the customer journey.
Utilize JTBD Framework
When segmenting the Total Addressable Market (TAM) as a SaaS or tech marketer, the Job-to-be-Done (JTBD) framework can be an effective analytical method. Focusing on the job that customers are trying to accomplish, rather than traditional demographics or firmographics, allows for more precise targeting and understanding of customer needs.
By identifying the “jobs” that different segments of prospects and customers are trying to accomplish, we can tailor messaging, features, and pricing to better serve and convert those segments. Additionally, JTBD analysis can inform product development and innovation by uncovering previously unconsidered use cases and pain points.
Apply Psychographic Segmentation
One of my go-to frameworks for TAM segmentation is the psychographic segmentation framework. This approach divides the market based on personality traits, values, attitudes, interests, and lifestyle factors. This method can be useful for companies that want to create targeted marketing campaigns that resonate with a specific audience.
For instance, a popular health and wellness brand, Lululemon, uses psychographic segmentation to target customers who prioritize a healthy and active lifestyle, value sustainability and social responsibility, and seek to live a mindful and purposeful life.
Psychographic segmentation can also help companies identify their customers’ pain points, motivations, and desires, and develop products and services that meet those needs. By understanding the deeper psychological factors that drive customer behavior, companies can build stronger emotional connections with their customers and foster brand loyalty.
Embrace Technographic Segmentation
As someone who has extensively worked in marketing, I’ve come to realize that Technographic Segmentation is an incredibly efficient and accurate framework for segmenting your Total Addressable Market (TAM).
This method allows you to inspect the various technical skills and preferences of your target audience. By analyzing data such as the devices they use, their digital behavior, and their tech stack, you can create a more personalized and targeted marketing strategy that is tailored to their unique needs.
This approach is particularly useful in today’s digital age, as it helps you keep up with the rapid pace of technological advancements and evolving consumer trends.
Combine ICP and Value Proposition
One of my “go-to” frameworks for segmenting the Total Addressable Market (TAM) is the Ideal Customer Profile (ICP) combined with the Value Proposition Canvas. The ICP helps me identify and prioritize the most valuable customer segments, while the Value Proposition Canvas allows me to map out their specific pain points, needs, and desires.
By combining these two powerful tools, I can effectively target high-potential prospects with tailored messaging and offers, ultimately maximizing our marketing ROI and driving accelerated growth for my clients.
Leverage ACV Framework
I always turn to the ACV (Annual Contract Value) framework for segmenting my total addressable market (TAM). The segmentation is based on the annualized revenue potential of each customer segment, which enables me to prioritize high-value customer segments.
This method not only helps me to quantify the revenue potential of each segment but also helps me to allocate the resources efficiently. It also helps me to identify which segment to target first, which vertical to consider, and which go-to-market strategy to prioritize.
Overall, ACV has proved to be a powerful tool for driving growth and profitability in SaaS and tech marketing.
Employ Pizza Slice Model
As someone who has a lot of experience segmenting the total addressable market (TAM) of different products and services, I can confidently say that the pizza slice model is one of my absolute favorites.
There’s just something so elegant and simple about breaking down your TAM into bite-sized, easy-to-digest pieces, like a delicious pizza. Not only is this model intuitive and straightforward, but it also encourages you to think creatively, and outside the box to identify different customer segments.
Whether I’m working on market analysis, a pitch to investors, or even just trying to better understand the needs of my target audience, the pizza slice model is always one of my go-to frameworks.