Market Segmentation Strategy: What Is It and Why Is It Important?

The basic definition of market segmentation is when your target audience is divided into smaller categories that share similar characteristics.

Here are a few reasons why this can benefit your brand:

• Creating hyper-targeted ads
• Building stronger relationships with customers
• Differentiating your brand from competitors
• Identifying marketing tactics that have more impact.

With market segmentation, you will gain greater insight into consumer behaviors.

You can and should define your own customer segmentation, but the key textbook examples are:

• Geographic: country/city, urban/rural etc.
• Demographic: age, religion, gender, income, socio-economic type, education, family size/status
• Psychographic: lifestyle, interests, hobbies, opinions, influencers
• Behavioral: buyer journey stage, brand loyalty traits, price sensitivity, purchasing style, usage rate
• Media: social media/TV/newspapers/search engine preferences
• Benefit: customer service, quality, and other specific expectations.