The Segmentation Fail: Why Your “Industry” Pie Chart Is Hiding the Money
We love to group customers by easy labels like 'Industry' or 'Region.' But these labels are lazy. We show how to segment by behavior to find the real pattern.
The Lazy Pie Chart
Come, stand next to me and look at this slide. It is the classic “Who We Serve” pie chart.
It is split perfectly: North, South, East, West. Or perhaps: Manufacturing, Services, Technology.
It looks balanced. It looks complete. It gives us the warm sensation that we have covered the map.
But this chart is lying to us. It is grouping items based on their label, not their weight. It implies that a customer in the “North” is fundamentally different from a customer in the “South.”
The Noise: Convenience is the enemy of insight. It is easy to group by a column that already exists in the dropdown menu. But these convenient categories often hide the true biological differences in your customer base.
The Pattern: The real difference is not where they live; it is how they suffer.
The Heavy Tail
Let us dissolve the pie chart. Let us pour the data out onto the table and regroup it based on Behavior.
We are going to look for the “High Maintenance vs. Low Friction” pattern.
I want you to create two new calculated columns:
- Speed: (Days between First Contact and Signed Contract).
- Yield: (Total Revenue / Support Tickets).
Now, plot these points.
[TO EDITOR: Image of a Scatter Plot. X-Axis: “Speed to Buy (Fast -> Slow)”. Y-Axis: “Yield (High -> Low)”. Show two distinct clusters. One cluster is “Fast & High Yield” (The Ideal). The other is “Slow & Low Yield” (The Trap).]
Suddenly, the “North vs. South” distinction vanishes. We see a new reality. We have a cluster of customers who buy in 3 days and never call us. We have another cluster who take 6 months to decide and then call us every day.
The Strategic Pivot
And here is the kicker: Both clusters contain “Healthcare” and “Tech” companies.
The industry label was a red herring. The real segmentation is “Decisive Buyers” vs. “Bureaucratic Buyers.”
Once you see this pattern, your strategy changes. You stop buying ads for “Healthcare.” You start designing marketing materials that appeal to speed. You change your pricing model to penalize the slow decision-makers.
Stop grouping by the labels that are easy to find. Start grouping by the signals that pay the rent.
FAQs
Why is industry segmentation bad?
It isn't 'bad,' it is just shallow. A dentist and a hospital are both 'Healthcare,' but they buy completely differently.
What should I segment by instead?
Behavior. Velocity. Frequency. Order Size. Group them by the physics of their wallet, not the title on their door.
How do I see this in the data?
Use a scatter plot. Put 'Days to Close' on one axis and 'Deal Value' on the other. The clusters will reveal themselves.