Segment for Beginners: Discover the Pros and Cons

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business segments

Did you know that market segmentation is an important strategy for the overall success of your business? But it is also a marketing strategy that comes with plenty of pros and cons to consider too. 

In fact, in a world where there are also phenomenal segment alternatives to also choose from, you should really be doing a deep dive analysis on what will work best for your business and business goals specifically.

Let’s first start off by actually defining and explaining what market segmentation really is. It is a strategy that helps businesses in all industries actually identify and understand the habits, psyche, and behaviors of their various audience groups. The strategy is to divide into segments of people who share similar characteristics in a data-driven way.

When you are able to break it down in this way, you can develop a really valuable tool for yourself that helps you actually discover new business opportunities, new audience groups to target and new profit opportunities. These will all give you a competitive advantage in the market you are in as well as also help you create campaigns and tactics that are more reliable in giving you a solid return on investment.

So let’s start off with the five types of market segmentation that you should know about.

The Four Segments to Know

1. Behavioral Segments

This segmentation is something that you should use to actually consider the various influences of how your product or offering interacts with consumers. Understanding their purchasing habits, their purchasing priorities and their purchasing price points will ultimately help you engage with them more effectively.

2. Geographic Segments

Even in a digital world that is connected, location still really matters. You want to understand what any physical barriers may be, the competition in various locations and even the culture, customs, timezone, and population density that can all have an influence on someone.

3. Demographic Segments

It is also important to collect data on the various trends in relation to age, education, ethnicity, sexual preferences and income. These demographics will help make marketing campaigns more personable and products more appealing. 

4. Firmographic Segments

The business world is equally important to segment. You want to understand how a particular industry or organization acts when it comes to the size of a company, the amount and type of employees who work there and the various locations they are in.

5. Psychographic Segments

 Of course, you also want to try to get into the minds of consumers as much as possible. That is why it is important to collect data on various personality traits that include lifestyle goals, belief systems and passions. Understanding this will help you make your business more personal to consumers. 

The Pro’s and Con’s

So now that you understand the core types of segment, lets discuss the advantages and disadvantages to keep in mind too.

The Pros of Segments

Makes Marketing Effective

You want to be as streamlined and effective as possible when it comes to your marketing efforts. You want to also try to get the biggest ROI back on any marketing campaign spend too. This is why market segments can help act as supporting information in making marketing decisions and feeling confident that it will work effectively. 

Helps Businesses Grow

Growth is always important, no matter how big or small you currently are. The segments will help provide you with various insights that support overall growth and product development, as well as even staying ahead of the curve with the competition too. 

Enhanced Customer Journeys

The consumer journey is everything when it comes to potential business opportunities and an ultimate sale for you. Understanding how customers want to experience your business will help you deliver just that and really wow them. 

Win More and Spend Less

Keeping concise segments for your business will help you really stay tunnel vision when it comes to your overall budget and spend. You can make informed decisions and have a better prediction for resulting outcomes.

The Cons of Segments


How Expensive Research Is

While the resulting outcomes of segments is great, the expenses involved in the research and data organization can be both time-consuming and pricey. This is often why segment alternatives being often now are more preferred because they provide cost-effective and fast solutions for getting ultimately the same result.

Production Problems

Being personalized with products is important, but if you focus it too small, then you could end up losing out on potential opportunities. This is why segment alternatives are also helpful because they simply make recommendations for data already created and provide very fact-driven data sets for business decisions.

Unprofitable Segments

While you may discover an important segment for your business, it may not actually be profitable. So you really do not want to waste your time and money if they won’t give you the ultimate return you’re looking for.


Creating segments is important for your business. But don’t shy away from using segment alternatives to also achieve the same thing!

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