Focus

As the next generation POS platform, a broad segmentation resulted in adoption and growth challenges. We had built a product that is the fastest, smartest, easiest to use and most flexible to implement.

Spread too thin to accelerate

In the early days, we targeted restaurants, bars, nightclubs, festivals, events that needed a point of sale solution. The outcome was that as an org, we were spread too thin. We were unable to accelerate as fast as we would have liked. This is where I took some inspiration from Crossing The Chasm by Geoffrey Moore. It is a must-read for businesses that want to move from their early customers to a mainstream market. It’s an excellent guide for segmentation for early phase companies.

Finding that beachhead through Segmentation

As a leadership team, we set out to figure out our “focus” and answer one key question. We asked ourselves

“Which one beach-head (market sub-segment) do we dominate first, BEFORE expanding (to world domination)?”

We started with the industry-standard segmentation of these customers as a reference. It was usual to refer to them as a Cafe, Bar, Full Service Restaurant, Fast Casual Restaurant, etc. However, we wanted to find the common characteristics amongst customers that loved us. As a result, we had to break free of the taxonomy.

How would we get there? As a start, we aggregated data on various aspects from different systems. We started with the following metrics.

  • Lead generation source (Inbound vs outbound)
  • Location (Urban, remote, …)
  • Sales cycle time (Duration between first contact & signature)
  • Contract value (Monthly recurring revenues)
  • Ease of onboarding (Measured in time from signature to go-live, # of calls required to go through this)
  • Product adoption (Measured through stickiness metrics)
  • Degree of support required (Measured through number of support tickets in a given period)

We brought these numbers together in an excel even though they sat in different systems. After looking at them from different cross-functional lens, we did a few rounds of iterations on the exact metrics.

Accelerated growth through focused product development and GTM

Looking at these numbers together in a synthesised view, brought out the insight we were hunting for. We were able to define the sub-segment of the market that was easy to sell to, easy to onboard, that benefited maximum with our product and used our product with little help from us. We identified the cohort of customers that had good product adoption combined with the other factors. This, in essence was our Ideal Customer Profile.

As an outcome of this, we prioritised our product development efforts based on needs such customers have. The commercial teams focused their outreach on customers that demonstrated such characteristics, being a bit flexible on how that prospect would be classified in the industry.

An aligned effort within the product and commercial teams with this beach-head as a target resulted in phenomenal growth in the targeted segment in the past year.

Reflection: Unlock growth with Segmentation through a new lens

In past I’ve always read and heard about how focus can drive growth. This was an exciting first hand experience in a startup where I experienced it. In order to get here it was crucial to break free of pre-defined segmentation in the market. Bringing in the data points to extract the characteristics of this “target subsegment” crucial to unlock growth.

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