Methods for Talent Market Segmentation

Talent Market Segmentation is one of the key first steps in building a Sourcing Engine. You can’t successfully fill your talent acquisition pipeline if you don’t have a targeted outreach and networking approach.

Corporate recruiters face mountains of resumes, the result of posting job ads across the web. Who has time to go through all those applicants to find the few truly qualified candidates that your company needs to achieve its growth goals? Talent Market Segmentation eases your workload by allowing you to focus your recruiting efforts in ways and places that are most effective in a few organized steps.

  1. Segmentation by Competitors. Hiring from competitors provides a double benefit because we’re filling a gap in our organization, while creating one in theirs. It’s not the complete answer, as research shows that internal candidates consistently outperform talent from competitors. Also, these candidates are the ones most likely in need of relocation, which can get expensive. Still, hiring from competitors is a traditional recruiting strategy that can be very effective and should not be overlooked.
  2. Segmentation by Industry. In the recruiting business, we often refer to these as ‘Feeder’ companies. These are companies within our industry from which we can consistently pull experienced talent. This segment does not include direct competitors.
  3. Segmentation by Function. Our Finance and Graphic Design hires probably don’t need the same industry expertise as our Marketing, Legal and R&D recruits. This opens up new non-industry targets within the local geography. This saves money because we don’t need to pay for relocation, and people from outside the industry often have lower salaries, especially if they’re currently working for a smaller company, or in an industry with thinner profit margins.
  4. Geographic Segmentation*. On its own, geographic segmentation does not provide targeted results. For example, we might have a Home Depot near our company HQ, but if we’re a software developer, we probably don’t want to hire people from them. However, if we combine geography with Industry or Function, the result is a list of local companies that employ candidates we might want.
  5. Psychographic Segmentation*. This is sometimes referred to as ‘hiring for culture’. Sometimes we find companies in different industries that have corporate cultures similar to our own. Employees from these companies can transition easily into our organization, because they share our values and attitude.

*Geographic and Psychographic segmentation are not standalone categories. We need to combine each of them with Segmentation by Function to provide direction for our targeted marketing efforts. (To get really targeted, we can also add Industry to create a multi-category segmentation model.)

Next time I'll use a real world example to apply these methods and see what we come up with.

What do you think? Are there other segmentation methods you find useful? share your comments below or email me at

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