September 24, 2023

Market segmentation is an important part of any profitable advertising and marketing technique. Why? Nicely, simply take into consideration your personal goal market. 

Hopefully, everybody in your goal market has an curiosity in your services or products. However are all your potential prospects the identical age, intercourse, or situated in the identical area? Have they got the identical revenue and training ranges? Do all of them have the identical ache factors, wants, or wishes?

In case your market is like most, your audience contains a big number of potential prospects. Due to this, a technique that doesn’t consider the range of traits inside the goal market runs the chance of lacking the mark most of the time. 

As professional marketer Seth Godin stated, “Your buyer isn’t ‘Everybody’.” You’ll want to get particular about who you’re speaking with with regards to your advertising and marketing. That is the place a market segmentation technique comes into play. 

What Is a Market Phase?

A market phase is a bunch of people inside a bigger goal market who share a specific set of traits. Most goal markets may have plenty of totally different market segments, or teams that share comparable traits. 

For instance, if we have been to have a look at the athletic footwear market, we’d uncover a wide range of totally different segments: 

  • One phase is perhaps made up of true athletes who’re coaching exhausting within the health club each day
  • One other phase could also be in search of a cushty pair of footwear to put on when strolling their canine
  • Some prospects could also be occupied with type to impress others of their social group 
  • Others is perhaps in search of stability to cut back ache and stop falls 

The highschool basketball participant and retired grandmother each have an curiosity in athletic sneakers, however for very totally different causes. Every phase represents prospects with totally different traits, wishes, wants that can affect their expertise when searching for, buying, and utilizing the product. 

What Is Segmentation and Why Is It Necessary in Advertising and marketing? 

Segmentation is the method of taking a broad market and breaking it into varied teams (A.Ok.A. segments) based on particular traits, wishes, or wants. 

Take a brewery for instance, their broad goal market consists of shoppers who need to drink good beer and eat pub type meals. When trying on the broad goal market, nonetheless, many segments exist within the market. 

They could determine a phase that eats vegetarian, one that wishes to drink IPAs, one that wishes to spend much less and drink extra, one which prefers intelligent names for the beers, and one which likes to deliver their entire household out for dinner. 

So, why is segmentation vital for advertising and marketing groups? Nicely, understanding segments can assist in a couple of methods. To summarize, we are able to say it like this: 

Segmentation helps entrepreneurs make the proper affords to the proper prospects with the proper message.

Returning to our brewery instance, let’s say the advertising and marketing staff recognized a useful phase of their market made up of households with excessive incomes and younger youngsters. The advertising and marketing staff would possibly attempt to attract this viewers towards their enterprise by focusing their advertising and marketing efforts on this explicit phase. 

For instance, the entrepreneurs would possibly create a proposal for a children meal or add some outside seating with a small playground set for teenagers. They’d place their commercials in locations the place mother and father will see them, and of their messages, they’d give attention to the household pleasant environment and would possibly present photos of households consuming out. 

Widespread Kinds of Market Segmentation 

There are countless methods to phase any market. With regards to your distinctive goal market, it is best to outline the way you need to phase based mostly in your distinctive wants and targets.

Getting inventive along with your segmentation can assist you unleash new worth in your market, however in case you’re in search of some fast standards, a majority of these segmentation are positive to be helpful: 

  • Geographic segmentation: The place is your viewers situated geographically? Do they reside within the metropolis or in a rural space? What languages do they converse? 
  • Demographic segmentation: What are the age teams, religions, sexes, revenue ranges, training ranges, or household sizes? 
  • Psychographic segmentation: What existence, pursuits, hobbies, opinions, or influencers outline your viewers? 
  • Behavioral segmentation: The place are viewers members at of their purchaser journey, what model loyalty traits do they possess, what value sensitivity exist, what’s the buying type, and the way excessive is their utilization price based mostly on habits? 
  • Media desire segmentation: What social media platforms, tv networks, newspapers, engines like google, and different media retailers does the viewers have interaction with? 
  • Profit segmentation: What do viewers members hope to get out of the providing? What are their wishes, ache factors, and desires? 

B2B Segmentation & Firmographics 

Segmentation for B2B (Enterprise-to-business) entrepreneurs differs from the form of segmentation B2C (business-to-consumer) entrepreneurs do. Whereas B2C prospects give attention to the traits of their particular person prospects, B2B entrepreneurs give attention to firmographics and enterprise wants. 

Firmographics are traits of a enterprise group that can be utilized as standards for segmentation. As an alternative of utilizing Demographics, psychographics, or behaviors like B2C entrepreneurs, B2B entrepreneurs would possibly give attention to different standards akin to: 

  • Trade
  • Variety of staff 
  • Location 
  • Income
  • Buying energy 
  • Buyer lifetime worth
  • Buyer profitability 
  • Product utilization

With a purpose to make efficient advertising and marketing choices, B2B entrepreneurs additionally want to grasp the shopping for course of and resolution making standards inside the companies. This can make sure the advertising and marketing expertise is designed particularly for the enterprise they’re approaching. 

A 4-step Market Segmentation Technique & Market Segmentation Instance 

With regards to segmenting your viewers to arrange for a focused marketing campaign, instinct and luck will solely take you to this point. Companies which have essentially the most success with buyer segmentation have a transparent technique in place. 

Earlier than we get into the fingers on work of creating a technique, let’s attempt to give you a definition for Market Segmentation Technique. A working definition would possibly go one thing like this: 

A market segmentation technique is the method by which you determine, arrange, analysis, and goal a particular phase of a broad goal market. 

Constructed into this definition, we are able to pull out a 4 step course of for creating a segmentation technique. 

  1. Determine the key segments inside your broad buyer base—On this step, you’ll do some broad market analysis to uncover what sorts of traits, wishes, and desires exist inside your goal market. 
  1. Manage the viewers into segments—Right here, you’ll outline your segments based mostly on varied options and traits inside your market. 
  1. Analysis and select a phase—Then, you’ll do some deeper analysis on every phase to determine which you’d wish to give attention to in your advertising and marketing marketing campaign. 
  1. Create affords, craft messaging, and select venues—Primarily based in your analysis, you’ll create affords for the phase you need to goal, craft the messaging you’d wish to method them with, and work out what venues will present essentially the most publicity in your goal phase. 

Let’s take a look at every step and use Semrush’s One2Target device to uncover some market segments. For this instance, we’ll return to the athletic footwear market. 

Determine Your Market’s Main Segments 

The broadest stage of your market segmentation technique is the identification course of. Right here, you’re exploring your broad market to raised perceive what teams exist inside your goal market. There are a lot of methods to do that, together with: 

  • Authorities information sources
  • Publicly accessible information or reviews from analysis companies 
  • Web site analytics 
  • Social media platforms 
  • Market analysis software program 

For this instance, we entered into Semrush’s One2Target and selected and to outline our market. 

Trying on the Demographics Report we found that the principle phase of the viewers for these domains is males aged 25 to 34. 


Leaping over to the Socioeconomics Report, we’d additionally collect some information associated to family sizes and incomes. On this report, it’s clear the biggest phase of our goal market consists of households of 3-4 individuals in a low revenue bracket. 


At this stage of the method, nonetheless, you need to look past your largest phase and search to determine and fascinating traits within the information. For instance, in every of the domains, there’s a big share of feminine viewers members. We’d additionally observe is widespread amongst youthful audiences, whereas adidas is the most well-liked amongst audiences within the 65+ vary. Likewise, there’s a big phase of our goal market that reside in households of two with a center revenue vary. 

Any of those options of our chosen market may turn out to be a phase we need to goal. 

Manage the market into segments 

Primarily based on the information we gathered within the final part, we are able to pull out not less than three segments of our market we’d goal in a future advertising and marketing marketing campaign. Listed below are three choices: 

  • Males aged 25-34 dwelling in households of 3-4 with center to low incomes 
  • Females aged 45-54 who reside in 2 particular person households and earn a medium revenue 
  • Males aged 18-24 preferring Puma sneakers with medium to excessive incomes dwelling in 5-6 particular person households 

We recognized these segments based mostly on traits that emerge within the information depicted on the graphs within the final part. As a better look, right here’s the place we bought the phase of males aged 18-24 preferring Puma sneakers, have medium to excessive incomes, and reside in 5-6 particular person households. 


Analysis and select a phase to focus on 

After doing a little deeper analysis in your recognized segments, you’ll need to select the phase you need to goal in your advertising and marketing marketing campaign. The phase you select to focus on will rely in your assets and your targets. 

When selecting a specific phase, you might need to take into account: 

  • Measurement—Is it giant sufficient to help your targets? 
  • Progress potential—Is the phase going to develop sooner or later in measurement or buying energy? 
  • Buying energy—Will the phase have the assets to buy your product? 
  • Wants and needs—Is the phase’s wants and needs aligned with what you must provide? 
  • Competitors—What’s the stage of competitors inside the phase? Can you differentiate your product? 

The Hooley’s Phase Attractiveness and Useful resource Energy Framework 

The Hooley’s Phase Attractiveness and Useful resource Energy Framework is one other option to determine which phase is the only option in your subsequent marketing campaign. The framework helps you determine essentially the most engaging market segments and your potential to compete for these segments. 

The framework consists of two dimensions: phase attractiveness and useful resource power. 

The phase attractiveness dimension evaluates the potential of a specific market phase, whereas the useful resource power dimension evaluates an organization’s potential to compete in that phase.


Phase attractiveness is evaluated based mostly on the next standards:

  1. Market measurement and development potential
  2. Profitability and potential returns
  3. Aggressive depth and rivalry
  4. Entry boundaries and ease of entry
  5. Buyer wants and needs
  6. Compatibility with the corporate’s mission and values

Useful resource power is evaluated based mostly on the next standards:

  1. Monetary assets
  2. Advertising and marketing capabilities
  3. Human assets and expertise
  4. Technological capabilities
  5. Distribution and provide chain capabilities
  6. Model fairness and repute

With this information, you’ll be able to weigh the potential of assorted segments to determine that are the very best, which want enchancment, that are poor prospects, and that are your worst prospects. 

Create affords, craft messaging, and select promoting venues

After making a closing resolution on which phase to focus on, you’ll have to determine learn how to design your affords, learn how to talk with the viewers, and the place to share your messages in order that they attain your required viewers. 

With regards to designing your affords, take into consideration the phase’s main ache factors and their largest wishes. Are they tight on disposable revenue? Do they need one thing to do with their children? Are they in search of one thing sensible or are they looking for leisure?

These sorts of questions will assist you concentrate on what sort of provide to make to realize their curiosity. 

When creating your messaging, use language that the phase makes use of of their every day lives. As an illustration, you might need to keep away from slang or fashionable language with an older viewers. In case your promoting incorporates photos or sounds, be sure they resonate with the phase’s on a regular basis expertise. 

Lastly, select promoting venues the place your viewers phase spends their time. A method to do that is with the Additionally Visited desk in One2Target’s Viewers Overlap Report.

Let’s say we needed to run some voice advertisements on music streaming web sites. We may filter the Visited Domains desk to point out solely music based mostly domains. Right here’s a take a look at’s and’s additionally visited pages within the music class. 


Discover the variations within the lists of domains provided by One2Target. For Adidas, which had an older viewers, Spotify is the highest visited area within the music class. So if we have been concentrating on our phase of ladies aged 45-54, we’d place advertisements right here. 


Puma, alternatively, had a youthful viewers. Their prime music websites have been, and decrease down the listing,, a music streaming service extra widespread amongst youthful audiences. These is perhaps our selections if we have been concentrating on our youthful phase. 

Assume Lengthy Time period with Your Market Segmentation Technique 

Viewers segmentation is a strong device that may make it easier to enhance your advertising and marketing plan and extra successfully attain your audience. By breaking your market into smaller, extra particular teams based mostly on key traits, you’ll be able to create extra related and personalised advertising and marketing campaigns. 

It’s vital to recollect as you progress towards the long run that markets change and audiences evolve. Due to this fixed change, it’s vital to return to your segmentation technique frequently to be sure you’re nonetheless chatting with your viewers’s wants. This can will let you construct longer and stronger relationships along with your prospects, enhance engagement, and finally drive gross sales.