What is market segmentation?

Target marketing involves the identification of the most profitable market segments. Therefore, businesses may decide to focus on just one or a few of these segments. They may develop products or services to satisfy each selected segment.

A market segment can be defined as subgroup of people or organization, sharing one or more characteristics that cause them to have similar product needs.

The purpose of segmentation is the concentration of marketing energy and force on the subdivision (or the market segment) to gain a competitive advantage within the segment.

The market segmentation is mentioned as being one of the key elements of modern marketing and is, as mentioned, the process of dividing the market into several groups and/or segment(s) based on factors such as demographic, geographic, psychological and behavioral factors. By doing so the marketers will have a better understanding of their target audience and thereby make their marketing more effective
What is market segmentation?