How do you align your segmentation strategy with your marketing goals?

2 Types of market segmentation

There are four main types of market segmentation: demographic, geographic, psychographic, and behavioral. Demographic segmentation divides the market based on variables such as age, gender, income, education, occupation, family size, and life stage. Geographic segmentation divides the market based on variables such as location, climate, region, and urban or rural areas. Psychographic segmentation divides the market based on variables such as personality, lifestyle, values, attitudes, interests, and opinions. Behavioral segmentation divides the market based on variables such as purchase behavior, usage patterns, loyalty, benefits sought, and responsiveness.

3 How to segment your market

To segment your market effectively, you need to follow some steps. First, you need to define your market and your overall marketing goals. What is the scope and size of your market? What are you trying to achieve with your marketing strategy? Second, you need to collect and analyze data about your market. You can use primary sources, such as surveys, interviews, or focus groups, or secondary sources, such as reports, studies, or online tools, to gather information about your potential customers. Third, you need to choose the segmentation criteria and variables that are relevant and meaningful for your market and your goals. You can use one or more types of segmentation, depending on your product or service and your target audience. Fourth, you need to create and profile your segments. You can use descriptive labels, such as millennials, urbanites, or bargain hunters, to name your segments, and summarize their characteristics, needs, and behaviors. Fifth, you need to evaluate and select your segments. You can use criteria such as size, growth, profitability, accessibility, and compatibility, to assess the potential and attractiveness of each segment, and decide which ones to target and how.

5 Examples of market segmentation techniques

To illustrate how market segmentation techniques can help you align your segmentation strategy with your marketing goals, let's look at some examples. Suppose you are a clothing retailer that sells casual and trendy apparel for young adults. You can use demographic and psychographic segmentation to divide your market into segments based on age, gender, income, lifestyle, and fashion sense. For example, you can create segments such as college students, young professionals, hipsters, or minimalists. Then, you can align your 4Ps with each segment. For example, for the college students segment, you can offer affordable and versatile clothing, set competitive prices, sell online and on campus, and promote through social media and influencers. For the young professionals segment, you can offer stylish and sophisticated clothing, set premium prices, sell in upscale malls and boutiques, and promote through magazines and events. By doing so, you can increase your customer satisfaction, loyalty, and retention, and achieve your marketing goals.