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Documentation Index

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Goal: Define and size distinct customer segments based on shared characteristics, needs, and behaviors, enabling prioritized go-to-market and product strategies.

Tools Required

This skill runs using CORE memory only. No integrations required.

Step 1: Define Segmentation Dimensions

Ask: What factors differentiate your customers? Pick 2-3 primary dimensions:
  • Company/Organizational — Industry, company size (revenue, headcount), geography, maturity, growth stage
  • Role/Functional — Job title, function, seniority, responsibilities
  • Behavioral — Use case, problem being solved, buying pattern, engagement level
  • Economic — Budget size, purchase power, price sensitivity, procurement model
  • Technographic — Tech stack, infrastructure, data volume, integration needs
Ask: “Which of these matter most for your product?” Focus on 2-3 dimensions that predict buying behavior and product needs.

Step 2: Define Segment Archetypes

For each combination of your dimensions, create a named segment. Example:
  • Small SaaS Ops Manager — Startup/scale-up, self-serve, cost-sensitive, 1-5 users
  • Enterprise IT Director — Large org, buying committee, budget available, 50+ users, compliance-driven
  • Individual Consultant — Solo practitioner, flexible use, minimal support needs
Name each with a memorable label. Create 3-6 segments (not 20).

Step 3: Profile Each Segment

For each segment, fill out:
  • Characteristics — Company size, role, industry, tech stack
  • Problem/Job to be Done — What are they trying to accomplish? What’s the pain?
  • Success Metrics — How do they measure value from a solution?
  • Buying Process — Self-serve, sales, committee, RFP?
  • Budget — Typical budget range and procurement authority
  • Current Solution — What do they use today? (competitor, manual, spreadsheet)
  • Switching triggers — What makes them look for alternatives?

Step 4: Size Each Segment

Estimate market size using multiple approaches: Top-down: Industry reports, TAM estimates
  • Example: “There are 500,000 companies in the [industry]. If 20% have this problem and our TAM is $10B, and we capture 5%…”
Bottom-up: Sales data, customer interviews
  • Example: “We’ve signed [X] customers in this segment. Average deal size is $[Y]. If conversion stays constant, the addressable market is…”
Validation: Compare approaches. If they diverge, flag the uncertainty. Ask: “Which data source is most reliable?”

Step 5: Assess Attractiveness & Fit

Score each segment on:
  • Market size — Is it big enough to matter? (1-10)
  • Growth potential — Is the segment expanding? (1-10)
  • Product fit — How well does your solution solve their problem? (1-10)
  • Go-to-market ease — Is it easy/cheap to reach and sell to them? (1-10)
  • Defensibility — Can you own this segment long-term? (1-10)
Rank by weighted score (depending on your business priorities).

Step 6: Identify Segment Sequencing

Ask: “Which segment should we target first?” Consider:
  • Immediate opportunity — Where can we win customers fastest with current product?
  • Foundation — Which segment gives us a strong reference customer for moving upmarket?
  • Cash generation — Which segment has the highest LTV or shortest payback?
Create a roadmap: Segment 1 (now) → Segment 2 (next 6 months) → Segment 3 (future expansion).

Step 7: Present Segment Analysis


Market Segments Segment Overview
SegmentSize (TAM)GrowthProduct FitGTM EasePriority
[Segment 1]$[X]M[Y]% CAGR9/108/10🚨 Go Now
[Segment 2]$[X]M[Y]% CAGR8/106/10⚡ Next
[Segment 3]$[X]M[Y]% CAGR7/104/10ℹ️ Future
Segment 1: [Segment Name]
  • Market Size: [X]M(TAM:[X]M (TAM: [Y]M, SAM: $[Z]M)
  • Characteristics: [Company size, role, industry, geography]
  • Job to be Done: [What are they trying to accomplish?]
  • Key Pain Points:
    • [Pain 1]: Current workaround [Workaround]
    • [Pain 2]: Impact on [metric] is [Negative outcome]
  • Success Metrics: [They measure success by: X, Y, Z]
  • Buying Process: [Self-serve / Sales / Committee] — Timeline [Weeks/Months]
  • Typical Budget: [Min][Min]-[Max] per [year/month]
  • Current Solution: [Competitor / Spreadsheet / Manual process]
  • Switching Trigger: [What makes them change?]
  • Competitive Landscape: [Key competitors], Differentiation: [Yours]
  • Estimated Conversion: If [Effort], expect [X]% conversion → [Y] customers
Segment 2: [Segment Name] [Same structure as above] Segment 3: [Segment Name] [Same structure as above] Segment Sequencing
  1. Phase 1 (Now): Target [Segment 1]
    • Reason: Largest TAM + highest product fit + lowest GTM friction
    • Success metric: [X customers signed by Month Y]
    • Go/No-go gate: [Decision point if not on track]
  2. Phase 2 (Month X): Expand to [Segment 2]
    • Reason: Product learnings from Segment 1 apply; growth opportunity
    • Success metric: [X customers signed by Month Y]
  3. Phase 3 (Month Y): Explore [Segment 3]
    • Reason: Lower priority; reassess based on product evolution

Edge Cases

  • Segments overlap: Define clear boundaries. Ask: “If a customer fits both Segment A and B, which one is primary?” Use the dominant use case to classify.
  • Market size estimate varies wildly: Flag the uncertainty. Ask: “What would give us confidence?” (research report, customer surveys, sales experiment). Default to conservative estimate.
  • Segment is too small: Ask: “Is there a larger adjacent segment we should target first?” Combine micro-segments or deprioritize.
  • All segments score equally: Reassess your scoring. Ask: “If budget was unlimited, which would you build for?” Use that as a tiebreaker.
  • Segment requires product changes: Note it. Ask: “Are these changes aligned with our roadmap or do they require a pivot?” Decide on sequencing based on effort and strategic fit.