Is Flawed Segmentation Killing Your Growth? Try JTBD
Learn why age, industry, or persona often mislead and how needs-based segments reveal true innovation opportunities.
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You've meticulously crafted your customer segments. You have detailed demographic profiles, firmographic data, maybe even psychographic sketches. Yet, your marketing campaigns feel like a shot in the dark, product launches hit with a whimper, and sales cycles drag on. Sound familiar?
The hard truth is that traditional segmentation methods often build a detailed picture of who your customers are, but completely miss the mark on why they make choices or what they're truly trying to accomplish. Grouping customers by characteristics like age, industry, or personality traits creates an illusion of order, but these attributes rarely cause a purchase or predict future behavior. They are correlations, not drivers.
There's a more powerful way: Jobs-to-be-Done (JTBD) Segmentation. This approach shifts the focus from who the customer is to what they are trying to achieve. It provides a stable, actionable foundation for innovation, marketing, and sustainable growth by grouping customers based on their unmet needs.
Why Traditional Segmentation Falls Short
Before diving into the JTBD approach, let's pinpoint why conventional methods often lead innovators and marketers astray:
Correlation vs. Causation: Does being a 'Millennial' cause someone to buy a specific software? Does being a 'mid-sized manufacturing company' cause a need for a particular service? Rarely. These are descriptors, not the underlying drivers of need. Decisions are driven by the struggle to achieve a desired outcome in a given set of circumstances or situations.
Internal Heterogeneity: Segments defined by demographics (e.g., "women aged 25-40") or firmographics (e.g., "SMBs in tech") often contain vast differences in needs and priorities. One SMB might prioritize cost reduction above all else, while another prioritizes speed of integration. Lumping them together dilutes your strategy.
Instability: Demographic and psychographic profiles can shift, and customers might fit different profiles depending on the context. Needs related to getting a specific job done tend to be far more stable over time.
Poor Guidance for Innovation: Knowing your customer is 35 years old tells you nothing about what to build next. Traditional segments don't reliably surface unmet needs or point towards specific opportunities for creating value.
The JTBD Approach: Segmenting by Desired Outcomes
Jobs-to-be-Done theory starts with a simple premise: customers "hire" products and services to get specific "jobs" done. They aren't buying a drill; they're hiring it to create a quarter-inch hole. They aren't buying CRM software; they're hiring it to manage customer relationships effectively.
The crucial insight for segmentation is this: the basis for grouping customers isn't just the job itself, but the desired outcomes customers use to measure success when getting that job done. These outcomes represent their needs.
Think of desired outcomes as universal metrics of success for a specific job. They are typically structured as:
Verb + Metric + Object of Control + Contextual Clarifier
Examples:
Minimize the time it takes to generate a monthly sales report
Increase the predictability of project completion dates
Reduce the likelihood of data entry errors when onboarding a new client
Enhance the ability to collaborate on documents across different departments
(Verbs like Minimize, Increase, Reduce, Enhance are examples from the functional job verbs list)
The key idea for JTBD segmentation is: Groups of customers who prioritize the same set of underserved desired outcomes (high importance, low current satisfaction) form a natural market segment. These customers struggle in the same ways and value the same improvements, regardless of their demographic or firmographic makeup.
How to Implement JTBD Segmentation (The Process)
Finding these needs-based segments involves a structured research process:
Define the Market/Job: Clearly articulate the Job Executor (who is performing the job) and the core functional Job-to-be-Done you are investigating (e.g., "Financial analysts managing corporate budgets," "Parents preparing weekly family meals").
Uncover Desired Outcomes: Conduct qualitative research (customer interviews) focused only on the steps and challenges of getting the job done, not on existing solutions. The goal is to elicit a comprehensive list of 50-150 customer desired outcome statements related to the job. Use precise, outcome-focused verbs.
Quantify Importance & Satisfaction: Develop a quantitative survey based on the discovered outcome statements. Ask a statistically representative sample of job executors to rate the importance of each outcome and their current satisfaction with their ability to achieve it using their existing solutions.
Identify Opportunity Clusters: Analyze the survey data using statistical techniques (like factor analysis and cluster analysis). Look for groups of respondents who rate the same outcomes as highly important but poorly satisfied. These clusters represent distinct segments with unique unmet needs. The outcomes with high importance and low satisfaction represent the best opportunities for innovation.
Profile the Segments: Describe the unique profile of unmet needs for each segment identified. What outcomes are most important and least satisfied for Segment A versus Segment B? Optionally, you can overlay demographic or firmographic data onto these needs-based segments to see if any correlations emerge that might help with targeting or channel strategy, but the needs remain the defining characteristic.
The Power of Needs-Based Segments
Investing in JTBD segmentation unlocks significant strategic advantages:
Targeted Innovation: You know exactly which unmet needs are most important to specific groups, providing clear direction for developing new features, products, or services that will deliver measurable value.
Marketing Precision: Craft value propositions, messaging, and content that directly address the specific struggles and desired outcomes of your target segments. Speak their language, focus on their priorities.
Strategic Focus: Confidently allocate R&D, marketing, and sales resources towards the segments with the highest concentration of unmet needs and willingness to pay for better solutions.
Durability: Customer needs related to a core job evolve much more slowly than demographics or market trends, making these segments a more stable foundation for long-term strategy.
Mini Case Study: SaaSCo Finds Hidden Needs
Let's consider "SaaSCo," a hypothetical B2B software company selling forecasting tools. Initially, they segmented their market simply by company size: Small/Medium Business (SMB) vs. Enterprise. Their product development and marketing efforts based on this segmentation yielded inconsistent results.
Frustrated, SaaSCo undertook JTBD research focused on the core job: "Sales managers forecasting team performance." Through qualitative interviews and a quantitative survey rating desired outcomes, they uncovered something surprising. Cutting across the traditional SMB/Enterprise divide were two distinct, powerful segments defined by their unmet needs:
Segment A: The Accuracy Seekers: These managers, regardless of company size, were highly underserved on outcomes like "Increase the accuracy of revenue forecasts" and "Minimize discrepancies between forecast and actual results." They often dealt with complex, multi-variable sales cycles and felt current tools lacked predictive power.
Segment B: The Efficiency Enhancers: This group, also spanning SMBs and Enterprises, struggled most with outcomes like "Minimize the time required to compile forecast data from reps" and "Reduce the manual effort needed to update forecast status weekly." They were bogged down by data entry and consolidation tasks, craving better workflow automation.
The insight was clear: the primary struggle (Accuracy vs. Efficiency) was a far better predictor of needs and value perception than company size. SaaSCo realized their one-size-fits-all approach, informed by flawed segmentation, was failing to resonate deeply with either group.
Mini Roadmap: Acting on JTBD Segments
Armed with this new understanding, SaaSCo could develop a focused roadmap:
Phase 1: Targeted Enhancement (Next 2 Quarters)
Product: Prioritize backlog features addressing the top 1-2 unmet outcomes for each segment. For Accuracy Seekers: Develop an AI-powered suggestion engine for forecast adjustments. For Efficiency Enhancers: Build automated data pulls from their CRM and streamline the forecast submission UI.
Marketing: Create separate landing pages and targeted ad campaigns – one emphasizing enhanced predictive accuracy, the other highlighting time-saving automation.
Phase 2: Dedicated Solutions (Quarters 3-4)
Product: Evaluate creating specific product tiers or add-on modules optimized for each segment's core needs (e.g., an "SaaSCo Accuracy Suite," "SaaSCo Efficiency Pack").
Sales: Equip the sales team with discovery questions to identify which segment a prospect falls into early in the conversation and tailor the demo and value proposition accordingly.
Phase 3: Higher Abstraction Exploration (Ongoing)
Strategy/Research: Begin exploring the higher-level job these managers are ultimately trying to achieve – perhaps "Drive predictable quarterly revenue growth" or "Improve sales team resource allocation." How does better forecasting (both accuracy and efficiency) contribute to that bigger job? Are there unmet needs related to the higher-level job that could be solved in entirely new ways, potentially integrating forecasting with planning or coaching tools? This exploration informs long-term, potentially disruptive innovation.
This roadmap shows how JTBD segmentation translates directly into actionable product, marketing, and strategic initiatives.
Elevating Abstraction: Segmentation for Future Growth
As the SaaSCo roadmap suggests, JTBD segmentation isn't just about optimizing for today; it's about identifying pathways to future growth by understanding needs at different levels.
Working Today: Using outcome data to prioritize features or tailor marketing, as SaaSCo did in Phase 1, is a direct application that yields immediate results by better serving identified needs within the current market understanding.
Novel Concepts & Higher Abstraction: Phase 3 of the roadmap points towards this. By asking "What is the real job?" beyond just forecasting, SaaSCo might uncover opportunities for fundamentally different solutions. Perhaps the need isn't just better forecasting software, but a system that links forecasts directly to resource planning or automated coaching interventions for sales reps. This could lead to a new platform that gets the higher-level job ("Drive predictable revenue growth") done more effectively, potentially with fewer visible traditional forecasting features, maybe even adopted by a different primary user (e.g., Head of Sales Operations instead of individual managers). Focusing on higher-level jobs and their associated outcome segments is key to identifying and pursuing disruptive innovation.
Conclusion: Stop Guessing, Start Solving
Traditional segmentation methods often provide a comforting but ultimately superficial understanding of the market. They describe who customers are but fail to reveal the why behind their actions or the what they need to succeed.
Jobs-to-be-Done segmentation flips the script. By focusing on the customer's struggle and their desired outcomes in getting a job done, you uncover stable, actionable segments defined by unmet needs. As the SaaSCo example illustrates, this clarity illuminates the path forward, guiding innovation efforts, sharpening marketing messages, and ultimately, driving more predictable and sustainable growth. It's time to move beyond demographics and start segmenting based on what truly matters: the job your customers are trying to achieve.
What challenges have you faced with traditional segmentation? Share an example of a customer 'job' in your market where needs likely cut across demographics.
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Why Me?
There are probably less expensive options than me, but few can match my unique insights. There are definitely more expensive options…
I’ve been trained by the best in Outcome-Driven Innovation. Part of that training involved how to understand what the future should look like. As a result, I’ve taken what I’ve learned and begun innovating so I can get you to the outcomes you’re seeking faster, better, and even more predictably. Anyone preaching innovation should be doing the same; regardless of how disruptive it’ll be.
How am I doing this?
I’ve developed a complete toolset that accelerates qualitative research to mere hours instead of the weeks or months it used to take. It’s been fine-tuned over the past 2+ years and it’s second-to-none (including to humans). That means we can have far more certainty that we’ve properly framed your research before you invest in a basket of road apples. They don’t taste good, even with whipped cream on top.
I’m also working on a completely new concept for prioritizing market dynamics that predict customer needs (and success) without requiring time-consuming and costly surveys with low quality participants. This is far more powerful and cost effective than the point-in-time surveys that I know you don’t want to do!
I believe that an innovation consultant should eat their own dog food. Therefore, we must always strive to:
Get more of the job done for our clients
Get the job done better for our clients
Get the job done faster for our clients
Get the job done with with fewer features for our clients
Get the job done in a completely different and novel way for our clients
Get the job done in a less costly manner for our clients
But more importantly, I strive to deliver high quality and high availability. That's why I also have to be choosy.
All the links you need are a few paragraphs up. Or set up some time to talk … that link is down below. 👇🏻
Mike Boysen - www.pjtbd.com
Why fail fast when you can succeed the first time?
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