Target Market Segmentation involves breaking your target market down into clearly defined segments, or groups. These segments are typically characterised by common needs, psychographics, and/or demographics. Ideally, the process of market segmentation should be driven by data and insights, either gathered through primary customer research or through an analysis of any existing customer data. The ensures the segments are accurately categorised and defined.
The detailed understanding of your target market segments allows you to identify the priority segments (i.e. “who is our most valuable customer, who requires stronger retention strategies?”). You can then use this knowledge to approach your marketing efforts with a new mindset, to deliver more targeted campaigns and messaging. This leads to less wasted marketing spend and higher ROI on your marketing activities.