Dec 29, 2019

what is marketing segmentation

what is Market Segmentation

What is Segmentation
Segmentation source- Freepik

this is one of the most important topics of marketing called market segmentation targeting and is important to understand what is market segmentation
in this post, we will be discussing market segmentation with examples

When Any company or organization is coming in the market with the new product then they have to decide certain things and most important of them is segmentation targeting and positioning they have to think in which category their product belongs and what kind of people are interested in there product.

As the market has thousands of buyers and their preference vary with certain things like where they live, what they prefer, what is their culture, how much they earn, age, gender, lifestyle, personality, etc this is the things which very from person to person and if the company wants to come in the market with the new product then they need to understand this aspect of the customer at this point the market segmentation targeting and positioning play a crucial role lets learn one by one about each of the topic. after reading this you will understand the market segmentation importance, why is segmentation important, what is market segmentation and why is it important.

Market Segmentation

Segmentation means dividing the same product according to the different types of users and make subgroups of this product and then introduce the product according to the appropriate targeted audience. then these subgroups have there owned specialty like for higher-income people this part consist of premium products and for a lower-income family, the segment is made on affordable products.

the market segmentation is made with the help of the following points and they are further elaborated in detail so please keep reading.
  • Geographic
  • Demographic
  • Psychographic
  • Behavioral
Let's learn this points one by one and what they include will clear the picture of market segmentation


Geographic market segmentation is done based on country, State, City Location. it is very important to understand the market according to these parameters.
for example American Express card Users
Country; worldwide (Users are all over the world)
State: All state (Users are present in all state we cannot categorize them according to that)
City: Metro city has more users of American Express card because of the people who live in metro city has more purchasing power than the non-metro city
Location: Rural area has fewer users of American Express card so that to maintain the appropriate number of users in that region company has to target urban people as they have more purchasing power they can spend more. then the company can target these users.
Geographic Segmentation plays a very crucial role in market segmentation hence the organization needs to maintain a proper plan for this.

Demographic market segmentation

this include demographic factors for the segmentation like age, gender, income, occupation generation. A company needs to understand that the product they are going to introduce is going to attract how old people like youngs ones or older ones. According to these parameters, the company has to understand the need of specific customer then they can improve customer loyalty by understanding the need of the customer also income plays very important role high income means a person is able to buy more or expensive items the according to that company can improve their products and which can help them to enhance the customer experience with that product.

let's take the example of American Express Card and divide it according to the demographic market segmentation.
AGE: American express card users are most often of age above 24 as the person who is earning is most likely to be the user of this card.

INCOME: Most of the users are from the upper social class sector as these people used to travel via airplane and this card can be used as the traveling card then this is the best target population according to demographic way if we are talking about income factor.

OCCUPATION: Most of the users of this card are celebrities, sportsmen, Professionals, politicians as they have higher purchasing power so that people who have this kind of profession will the target audience for the American Express card.

This is all about market segmentation on the basis of the demographic environment.

Psychographic  Market Segmentation

This segmentation is also very important its shows the company how their target customer is thinking and what are their preferences so that the company can understand the taste of the individual person and makes the changes and improvement in their product according to customer need.the following are the points which are included in the segmentation of psychographic environment.

LIFESTYLE: Company has to read the lifestyle of there customer lets take again the example of American Express card. People with a luxury lifestyle, businessmen, travelers, and explorers are our target customers in this category of market segmentation.

PERSONALITY: People who are comfortable with the online transaction will be my target customer also the users of the online transaction who are looking for the cashback attracts towards American Express card.

BEHAVIORAL Market Segmentation

Behavioral market segmentation talks about the user status, usage rate lets take the example once again of the American Express card and then talk about that.

USER STATUS:  Loyal users and regular online transaction users are a target audience.

USAGE RATE: light users and positive attitude towards credit cards are the target audience for American Express Card.

American express card Segmentation
American express card Segmentation part 1

American express card Segmentation part second
American Express cardSegmentation part 2

Market Targeting

Business Class people.§Frequent E-Commerce users preferred online transaction.§Frequent visitors at Premium Hotels like Taj Hotel§Frequent Travelers from Airlines.§Exclusive Restaurant visitors for premium Services§Luxury items buyers .§People Used to preferred Online transactions for Food, Commute, Purchasing, Entertainment.Eg. Swiggy, Uber, Amazon, Bookmyshow

American Express card Targeting
American Express card targeting

Thank you for reading if you want to say something about market segmentation please put a comment in the comment section thanks again.i will upload more posts like that where I will update the real-time scenarios and we will do the case study on that so make sure you are following my blog whenever I will write a new post you will get the notification for the same hope you are enjoying my blog so thank again and don't forget to mention the comment

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