Market Segment

Written By:
Paul Tracy
Updated November 11, 2020

What is a Market Segment?

A market segment is a discrete group of individuals who bear a number of similar characteristics.

How Does a Market Segment Work?

A market segment is characterized as a homogeneous population within a given market whose members display similar responses to certain stimuli and bear distinct social, cultural, and economic features. For example, a market segment can be comprised of individuals of the same age group, interests, language and/or gender. Individual market segments are often classified as social, demographic and geographic.

Why Does a Market Segment Matter?

Companies use market segments as part of a marketing strategy. Understanding that a given product or service may be most marketable among a specific group, a company identifies the appropriate market segment. It then launches its advertising campaign so that it appeals to those who fall within that segment.