Market Segmentation- Why and How

Now that we have learnt the basic marketing mix, it is important that you remember to create a different marketing mix for each different segment.

But, what is market segmentation- it means different groups of your target audience, divided based on demographics like age, gender, income, nationality or behaviours like preferences, interests or psychographics like personality, lifestyle or attitude etc. Each market segment is unique and needs to be addressed with a unique marketing style.

Let me explain segmentation further with a few examples-

1. Marketers will end up wasting time if they don’t segment for beauty products. You cannot advertise for men’s products to females and vice versa.
2. For nutritional or low-calorie food products, you need to market to the right audience, similarly fast food chains will market accordingly to working demographics or teens.
3. Investment companies will have to make calls to people based on age and income, there is no point in selling savings plans to high-school kids.

What we understand from these examples is that, market segmentation plays a major role in cutting marketing costs and increasing conversions. With the right marketing tactics reaching the right audience, there is bound to be higher conversions and thus more sales!