Market segmentation groups consumers into different groups according to certain characteristics and needs.
Market segmentation is the division of the market into smaller, uniform groups whose members share certain characteristics and needs. These groups are not imposed arbitrarily, but rather arise after market research that allows the different segments to be recognized.
It should be noted that segmentation is the action and effect of segmenting. It is the division of something into segments, fragments or portions .
A market , on the other hand, is a social institution that promotes the exchange of goods and services . The market arises with the union of sellers (offers) and buyers (demanders), who establish a commercial relationship to complete transactions or agreements.
Usefulness of market segmentation
Market segmentation reveals the existence of groups that are homogeneous in terms of their members (with people who are part of similar trends and who respond in similar ways to marketing strategies), but heterogeneous among themselves (one group is not similar to another). .
In this way, when carrying out this segmentation by any company, what it tries to do is know what the needs of that group to which its products or services are directed . This way you will be able to adapt what you offer to their tastes and this will also be an important stimulus for the entity that will take advantage of its competitors and see how its profits increase.
Due to the results obtained, market segmentation is especially useful for self-employed people and small or medium-sized companies as it is the way to specialize in a specific sector where they will have the opportunity to become a true reference.
Market segmentation is a key marketing tool.
Its development
Selecting the market that best suits the items and services it provides, building customer loyalty and even preparing the most appropriate and optimal marketing campaigns are the three main motivations that lead entities to undertake segmentation. This must be undertaken based on the following steps:
- Identification of what the different segmentation variables are.
- Description of the profiles that occur within each segment.
- Evaluation of the interest and attractiveness of the segment based on the optimal benefits that it can provide to the company in question.
- Determination of the segment that can be really interesting and that is the one to work with.
- Establishment of possible actions to undertake.
- Definitive and real application of tasks to improve the state of the company based on the selected segment.
The deepest market segmentation
To develop segmentation, segments must be identifiable, measurable, accessible and manageable. Logic dictates that each segment must be large enough to be profitable; Otherwise, an entrepreneur would have no reason to direct marketing strategies to said group or invest in innovation for the development of new products aimed at the segment.
Deep segmentation occurs when many variables are taken that provide extensive knowledge of each segment. This allows you to profile the buyer and anticipate with relative precision how consumers will react.