Posted on: October 8, 2021
As a marketing term, “segmentation” refers to the process of grouping potential buyers into groups or segments based on their common needs and how they respond to marketing initiatives. Market segmentation allows companies to target different categories of consumers who value certain products and services in different ways.
In market segmentation, products and branding are tailored to meet the needs of specific groups of consumers. You can segment markets based on a number of factors, such as psychographics (e.g. attitudes), demographics (e.g. age, gender, family size, income, and life stage), or behavioral traits (e.g. usage, spend).
Market segmentation aims to minimize risk by identifying which products and/or services have the best chances of capturing a share of a target market and determining the best way to deliver those products/services. Thus, the company can optimize its efficiency by focusing its limited resources on initiatives that produce the greatest returns on investment (ROI).
Businesses can implement the data gathered from market segmentation in future marketing campaigns with a more narrowly targeted audience. Developing marketing messages that engage your audience becomes easier when you know who you’re talking to. A generic, vague tone should be avoided in your writing; consider direct messaging instead, which speaks to the unique needs, wants, and preferences of your target audience.
You can target audiences with digital advertising platforms based on user age, location, buying habits, and interests. Using market segmentation to define your audience allows you to develop more effective, targeted digital marketing campaigns by knowing these specific characteristics.
Segmentation and Targeting Strategy
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