Market Segmentation. Know Your Audience!

Market Segmentation. Know Your Audience!

If anyone launching a campaign tells you that their product is for everyone, they are either lying or they just don’t know.

Market segmentation is probably the single most important action you can take for your new product or service or website. In the most simplistic terms, market segmentation is the act of dividing up the market into smaller subsets (segments) of potential consumers. Each of these subsets has different needs, desires, personalities, and motivations to fall in love with your product. You need to know who they are before you strike up any kind of conversation with them.

“Everyone”, in the context of going to market, means no one in particular!

What are the market segments?

The easy ones include age, sex, and location. Is your new product for women in their 20s in Vermont? If so, your messages will be very different with them than, say, men in their 50s in Venezuela.

But there are a great many other ways you can divide your market into useful subsets. Some of these include psychographic segmentation, demographic segmentation, geographic segmentation, behavioral segmentation, customer segmentation, benefit segmentation, or cultural segmentation. We will have a look at some examples of what they mean and how this kind of segmentation is important.

The objective of market segmentation is an easy one. You have a product, and it needs to be seen and understood by the right people for it to get sold. In the examples of market segmentation below, we can easily see how getting to know your market better will help you find the highest yield segments – the groups of people more likely to be your best customers.

> Psychographic Segmentation

This sounds a little like weird science, but in fact psychographic segmentation is all about lifestyles and personalities, the activities, interests, and opinions of the consumers. If you are launching a new app for singles that will blow Tinder out of the water, for example, you will want to make sure that the market segment you choose is open to meeting people online, that use other similar apps, or that they often go on dates. This is a psychographic segment.

> Demographic Segmentation

A demographic segmentation is all about statistics and the kind of basic data you might find in a census. Some of the demographic details that will help you are:

  • Age

  • Gender

  • Marital status

  • Family status

  • Employment

  • Income

  • Education level

  • Religion

  • Ethnicity

Each of these, in turn, can be broken down even further and combined. You may find that your luxury travel service appeals to MUPPIES (middle-aged upwardly mobile prosperous professionals) and DINKS (dual income, no kids) but not to SITKOMS (single income, two kids, oppressive mortgage). Knowing this does not mean you avoid the SITKOMS for your luxury travel experiences, but you might couch it in a different language – “wouldn’t you like to just get away from everything?”

> Geographic Segmentation

This sounds obvious, but what if you are opening a new antique shop in Hannibal, Missouri? Obviously, your geographic segmentation will want to concentrate on consumers and customers who can and will travel to Hannibal. But what if you are thinking about a franchise business? You will look at the geographic segmentation to see if you can expand to Kansas, Iowa, Arkansas, or further afield to Canada, Mexico, or American Samoa. Combining this geographical data with demographics and other factors will tell you where your franchised shops would work the best!

> Behavioral Segmentation

The behavioral segmentation usually refers to buying behavior. Are the consumers regular buyers, repeat buyers, or one-time special-occasion buyers? Are they loyal to brands or are they switchers? Do they plan their shopping or is it more an impulsive decision? All of these criteria can be found in established market studies and will help in deciding which ones are the most important to you. For one example, the tabloid National Enquirer is mostly an impulse buy – consumers buy it because they see it, not because they plan to buy it – and therefore it is placed most often next to the check out area of stores. The New Yorker, on the other hand, is more of a considered purchase and people will think about subscribing or going out on purpose to buy one. These are two very different behavioral segments.

> Customer Segmentation

Who is your customer? Is it a business or a wholesaler (B2B)? Is it an individual? Is it a group? Is it an online customer or a brick-and-mortar adept? These are big questions that need to be answered. What if you had a fashion business? One segment might be distributors, one private consumers, and one marketing or modeling agencies. Dividing them up, you will know better how to talk to each of them.

> Benefit Segmentation

Benefit segmentation speaks to the motivation behind the consumer’s buying. What are the distinct needs, the perceived value, the benefits sought or advantages that they get form from the purchase of your product?

If you are using benefit-sought segmentation, you might have different quality levels, performance, customer service, special features that fit different parts of this segment. Remember your luxury travel service? If you had an offering for special discounts to less popular (but still luxury) destinations, you might lure your SITKOMs back!

> Cultural Segmentation

Cultural segmentation is potentially tricky in that you run the risk of untrue generalizations about a specific culture. But it is still a useful measurement and market segment if you stick to large general lines. A producer of women’s swimwear, for example, will want to know if the cultural segment is composed largely of German, Italian, or Asian consumers. Why? Because there are differences in body size and shape that will affect your production. If you are marketing a line of gourmet food products, you will want to focus on convenience and family for an American segment, on the sophistication of preparation for a French segment, and on organic or natural products for a German segment. Of course, these are not reliable in isolation and other segmenting will be useful to make a final choice, but it can be a helpful action.

Other More Specific Segments

If this paints a picture of the most common kinds of market segmentation, it is also true that you can become a lot more specific in determining the subsets of the market that suit you best.

This is also sometimes called niche marketing. A “niche” can be defined as a small but highly specialized market for a product or service. One example of this could be auto parts. If your business produces spare parts for Citroën only, for example, then you will have a niche market that excludes many other car manufacturers, their owners, and their enthusiasts.

Aside from niche markets, there are many other kinds of market segmentation that could be useful for your go to market strategy.

> Seasonal Segmentation

This refers to products and service that are highly dependent on the seasons. Pools in the summer, skis in the winter, Christmas trees, Easter eggs, fireworks, or any other product that is sold only at one time in the year. At one point in the US market, Sears and JCPenny divided the “back to school” market segment for children’s clothing. Their biggest promotions and sales, therefore, were concentrated in late summer and early fall.

> Media Segmentation

This kind of subdivision is based on the idea that different media tend to reach different audiences. If a brand outs its whole budget into one media (radio, for example), it can possibly dominate the segment of the market that listens to the radio often. Who are they? Consumers whose job makes them drive a lot – taxi drivers, truck drivers, and commuters. They lose out on people who mostly read newspapers or peruse websites, but perhaps this segment is less important to them. Knowing how consumers get their news, information, and entertainment will help inform go to market decisions.

> Health and Healthcare Segmentation

Is your target consumer generally in good health? Are they frequent patients at the local clinic? This may seem like overkill, but imagine you are a pharmaceutical company. Your new pain reliever is of little interest to people who are in good general health. You could also apply this to sporting goods and equipment.

Do your consumers use private healthcare and insurance or do they depend on HMOs? Medicare or public health systems? These questions could also change your go to market approach, depending on your product.

Do it. Don’t Overdo it!

These are just a few of the market segmentation possibilities that are out there. But beware of diving too deep! The choice you make for your market segment will be informed by a common sense knowledge of your product and its potential buyer. If you drive the segmentation too far, you may find the ideal buyers for your product reduced to only a few people!


If you are getting ready to take your new product or service to market, help is there for you. Getting expert advice on how to get your product to market, from such companies as The Go To Market Company, will help you define your market segmentation in the most natural and profitable way possible.

Market Segmentation. Know Your Audience! The go to Market Company