BusinessMarketingOnline Earning

What is market segmentation and what are its types?

What is market segmentation and what are its types? When it comes to improving the marketing effectiveness of your business, market segmentation should always be your number one focus. In this article, you will learn about 4 common types of market segmentation, plus some that you may not have heard of before.

Market segmentation is an important part of a strong marketing strategy and can make a difference for companies in competitive market prospects, such as e-commerce.

Read Also: Customer success metrics that every business should consider

When facing a wide range of online competitors, effective communication is the best way to differentiate your business. Market segmentation provides an opportunity to identify the messages that drive customers to buy from you.

What is market segmentation and what are its types?
What is market segmentation and what are its types?

The 4 main types of market segmentation are:

  1. Demographic
  2. Psychological
  3. Geographical
  4. Behavioral

Below we will discuss these 4 types in more detail.

4 types of market segmentation with examples

The purpose of market segmentation is to identify different groups among your target audience so that you can send them more targeted and valuable messages.

There are four main models of customer segmentation that should be the focus of any marketing program.

For example, there are four types of classification: demographic, psychological, geographical, and behavioral. These are common examples of how businesses can segment their market by gender, age, lifestyle, and more.

Let’s take a look at what each of these means to your business.

1- Demographic segmentation

Demographic segmentation may be the first thing people think of when they hear “market segmentation.” This may be the easiest way to define customer groups, but it is also powerful. Demographic segmentation refers to identifiable non-personality traits such as the following:

  • Age
  • Gender
  • nationality
  • Income
  • Level of Education
  • Religion
  • Profession/role in a company

For example, demographic segmentation may target potential customers based on their revenue, so your marketing budget is not wasted on direct messages to people who may not be able to afford your product.

Luxury goods maker Montblanc has released a collection of offers on its website. One of the offers was to increase the conversion rate using the Father’s Day contract, which offered a free gift to those who spent more than 200; The amount confirmed Montblanc’s target audience spending expectations and saw a 118% increase in conversions for those in demand.

Another bid targeted corporate gift buyers (the part of the market for which Montblanc is most attractive), leading to a 30% increase for that segment.

Segmentation is not just about getting your business to reach customers more effectively; Rather, it means that customers will see the messages that are most relevant to them!

2- Psychological division

Psychological segmentation focuses on the personality and interests of customers. Here we may look at customers and define them based on the following characteristics:

  • Personality characteristics
  • Entertainments
  • Life goals
  • Values
  • Beliefs
Conclusion

All customer decisions are evaluated based on whether the result is what they want or what they need. Market segmentation allows you to identify these needs and market them directly without any useless messaging.

Whether you tell novice drivers the best car insurance for them, or offer barbecues and sun loungers to those living in the middle of a heatwave, market segmentation gives you thousands of ways to make sure your customers get exactly what they want. And see what they need.

Read Also: What is Profit Margin and how is it calculated?

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button