What is market segmentation?

You have just finished reading the book “building the best marketing plan to grow your business” you have shown everyone your strategy and sat back to bask in your accomplishment…but what about the customers? If you build it, they will come.  

Communication is an art, and it is very easy to lose or confuse your message: the larger your audience, the broader their preferences and opinions.  Do you want to risk making your one message irrelevant to the majority? Have you heard of marketing segmentation? 

What is it? 

Marketing segmentation (it’s a mouthful) is the idea that you break down target markets or audiences into smaller categories. When you segment your audience into a smaller group, it becomes easier to find similar characteristics such as interests, needs and wants. When you want to get your message across and relate, marketing segmentation is key. 

The benefits?  

The idea behind it is to give you an advantage over your competitor. As you start to understand and break down the individual customer segments, you can focus your message and tailor it to them. Every business wants the ear of their customer and become far more important to their life. For example, you can have the same product that means multiple things to multiple people, identifying the who and why they buy and then targeting your message around that is the key. 

What are the types? 

There are 4 different types of segmentation. Lets go through them all.

Marketing Segmentation

Demographic segmentation is the usual go-to when ‘market segmentation’ is easy to understand and used everywhere. It’s the most straightforward way of defining customer groups. It uses the main identifiable traits such as: 

Marketing Segmentation - Demographic

*Something to note (it’s still a conversation around how or if non-binary affects this

For example. Demographic segmentation might target potential customers based on their income, so your marketing budget isn’t wasted directing your messaging at people who likely can’t afford your product. Luxury products like watches are a good example of how this. Based on income, you can define who can afford your product, so your message is not wasted.

Psychographic segmentation: 

For me, psychographics can be the hardest but most rewarding. Personalities, interests and hobbies can help unearth your niche 

Marketing Segmentation

Understanding your customer using psychographic segmentation will take a lot of work, but it can inspire so much content and give you access to the pulse of your customer.

Geographic segmentation: 

As a good comparison, geography can be super easy and is usually how sales teams define their areas. 

Marketing Segmentation

A business like ours, for example, can easily lean into being very London centric, with local social ads and running events where lots of potential customers may be located. 

Behavioural segmentation: 

Behavioural segmentation is possibly the most useful of all, especially for e-commerce. A website can work to gather the data for you and eventually fine-tune its buying cycle based on the customers who use it.

Marketing Segmentation Behavioural

For example, people who remain inactive but visit often can be given a second message or offer to push them over the line. People who leave stuff in their basket can be prompted to push through the purchase. Once you have a customer and know what their browsing history is like, we can retarget for a stickier conversion and see different products they might need. 


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There are many ways to build your segmentation plan. If your targeting or retargeting your customers, it can help your business!

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