Profitability is in. Growth at any cost is out.

This puts sales and marketing (S&M) spend on the firing line. Sales and marketing are typically the largest area of spend for an expansion stage company. So to increase profitability, businesses are rationalizing their S&M expense.

As a sales and marketing leader, you want to ensure this process is rational, not overexuberant. It’s ok to cut spending on aspirational or lower margin programs, but avoid cuts to the high return programs.

I’ve found that a good way to make these decisions is reassessing your segmentation and targeting. Who are your strongest buyers, really? And are there better, data driven ways to target them?

Your strongest buyers are the ICPs and personas with the highest win rate. I’m making the simplifying assumption that the profitability of our various products and target markets is the same or similar.

But here’s where you can get tripped up. Reports and dashboards in your CRM will segment by firmographic attributes. But win rates within a firmographic-based segment can vary widely.

You should dig deeper.

Targeting The Software SMBs With A 50% Higher Win Rate

We work with a SaaS vendor that primarily targets software SMBs for its QA offering. But not all software SMBs are equally good targets. By interviewing buyers in a group of recent deals, we found win rate varied with the SMB’s lifestage. This vendor won 75% of its sales opportunities with larger SMBs that had transitioned to product quality as an “executive issue.” This is 50% higher than their overall 50% win rate with these startups. We found the larger, higher win rate SMBs were generating enough revenue that they couldn’t ignore quality problems. They’d moved on from an earlier “new features, not product quality” mindset.

A 75% win rate is extraordinarily high. We advised the CMO to consider shifting funds into this segment, after comparing its performance to the win rates for other segments.

But finding the right data to target a segment like this can be tricky.

Building a list of software SMBs is straightforward. But at what size company does QA become an “executive issue?” We get a first approximation from data about the companies interviewed. From there, we can test and refine.

This is why I recommend using focused messaging.

Focus Your Messaging To Improve Profitability

Reach out to me about a line of credit, software development, appointment setting or any of the dozen other generic issues in my inbox and I’ll tune you out.

Speak to my specific situation, pain, and goals. Then I’ll pay attention and may truly engage.

Focused messaging makes your targeting more precise. It increases S&M efficiency.

When your messaging helps prospects self-select, the top of the funnel gets smaller. You won’t spend sales and marketing resources bringing low win rate, unprofitable prospects into your funnel.

The tradeoff is increased return on marketing spend. Profitability. You win a higher percentage of the prospects that do enter your funnel.

Identify And Target The Highest Converting Buyer Personas

A deeper understanding of the buyer also makes it possible to target the most profitable personas.

Here’s an example.

When we were hired to help a SaaS vendor reduce “no decision” outcomes, we found their “no decisions” were highly correlated with how the champion advocated the investment internally. Opportunities that were championed for their technology benefits — saving “effort, time, and money” for IT, for example — always ended in a “no decision.” Of opportunities that were championed for a business improvement — “accessing new customers or markets” for example — just 25% ended in a “no decision.” Seventy-five percent of these deals were wins.

I think the most important insight revealed by these interviews was the detailed industry-specific benefits sought by the wins and losses that did not end in a “no decision.”

This has been used to develop focused, industry-specific messaging to attract and engage these “business” rather than “technical” champions.

A Five Step Process For Data Driven Targeting And Messaging That Improves Profitability

The examples I’ve given above are all derived from our work with B2B SaaS companies. We used win-loss buyer interviews to provide the insights and recommendations I’ve described.

This is a high level overview of the process we use.

    1. Recruit champions for a brief interview. Resist the temptation to interview just your wins or your losses. A buyer segment that’s associated with wins can also be a source of losses. To know how strongly a segment is correlated with winning, you need to analyze both won and lost opportunities.
    2. Focus the interview on a consistent set of questions about the buying context more than the buying decision. Why were they in the market for a new solution? Explore the status quo. How did the champion explain why change was necessary? Who first advocated for change? Who else was on the buying team?
    3. Analyze each interview transcript. Identify and tag key attributes of the buying context and internal advocacy. You can use Excel or Airtable to record these attributes. Or use a purpose-built qualitative data analysis tool like Condens or Dovetail.
    4. Calculate a win rate for each of your key attributes. For each attribute, how many times was it present in wins? How many times was it present in losses? Divide each attribute’s total wins by the sum of its won and lost opportunities.
    5. Cluster the attributes to identify buyer segments. Look for high win rate attributes that occur together. Look for low win rate attributes that occur together.

Use this understanding of your high win rate buyers to focus your messaging and targeting. I recommend applying it to content marketing and SEO. Sales development teams can combine this focused messaging with better targeted lists. In other channels, like PPC or display advertising, more granular targeting won’t be available. Use buyer focused messaging so prospects can self-select.

Dave Kellogg uses a fishing metaphor — “what you put on the hook” — to advocate focused messaging in his post here.


To improve profitability, shift S&M spending to the ICPs and personas with the highest win rate. Other things being equal, we’re more profitable when we win more deals.

But win rates within a firmographic-based segment can vary widely, so it pays to dig deeper.

I recommend using buyer interviews to reassess who your strongest buyers are, and develop innovative ways to target and message to them.

In the race to increase profitability, the winner will be the one who understands the buyer and customer best.

You don’t have to go all in on day one. Develop insights by interviewing recent buyers. Use this data to improve your targeting and messaging. Test the new programs against current ones, and adjust funding based on their performance.

Customized, In-Depth Win/Loss Analysis