Market segmentation is the division of customers into groups with similar needs, behaviour or circumstances, so that a company can address them differently. Criteria can be industry and company size in the case of B2B, the problem being solved, the way of purchasing, price sensitivity, or life situation in the case of consumers. A meaningful segment has three characteristics: it is large enough to be worth caring about, its members can be reached, and they have a genuinely different need from the rest. Division by age and gender tends to be unusable for most companies, since it implies nothing for communication or for the offer. The practical output is a decision on which segments the company serves as a priority and for which it tailors its offer and copy.
See also: Ideal customer profile, Brand positioning, Customer survey.
