Key Terms
Example
A lawn treatment company targets suburban areas; urban residents often have no yard to treat.
Variables
Gender, income, age, education, race, ethnicity, religion, occupation, family structure.
Income segmentation example
A car manufacturer prices entry models around $30K and top models at $95K+ - same brand, different income segments serve
Values-based psychographic example
Consumers who prioritize sustainability respond to product buyback and recycling programs.
Firmographics
The B2B equivalent of demographics. Groups companies by shared organizational attributes.
Technographic segmentation
Groups prospects by the hardware and software technologies they use. Identifies which companies are likely candidates fo
Needs-based segmentation
Focus resources on customers who actually need the product and can afford it. Levitt's quote captures this: "People don'
Behavioral segmentation
Groups by how customers interact with your company - website behavior, email opens, content engagement. Often paired wit
Geographic
Same logic as domestic geographic segmentation, but adds infrastructure as a critical variable. Infrastructure = roads,
Political and legal factors
Government stability, receptiveness to foreign firms, monetary regulations, tariffs, import quotas, currency controls, a
Cultural factors
Language, religion, values, shared attitudes. One useful model is Hofstede's cultural dimensions.
Power Distance Index (PDI)
How much power inequality a culture accepts.
Uncertainty Avoidance Index (UAI)
How much a society tolerates risk and ambiguity.
Masculinity / Femininity (MAS)
Degree to which gender-specific roles are valued.
Target market
The group of people with shared characteristics identified as potential customers.