4 types of market segmentation with examples

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We have written an article regarding the 4 types of market segmentation with examples. Market segmentation allows you to conduct robust market research into customers. Thereby isolating customer experience, developing potential loyalty programs and product development innovation.

How to conduct segmentation research

Understand why you want to do a market segmentation process. And what results are you hoping to get from it? Also, what variables of customer segmentation and hypothesis do you want to develop from any findings? Then plan the research project, collect data, analyse what you find, and create segments. Evaluate the target segments as well as choose the most viable option to develop your project.

Identify specific user case so that you can offer a more personalised product/service. Select your target segment and then identify the implications of this segment or persona. Then, decide who are the key stakeholders and develop internal communications plans. And then start the project using the target segments Look at the market from a demographic view. And then look at geographical, psychographic and behavioural segmentations.

What is demographic segmentation?

Demographic segmentation is when your data is about demographic characteristics to target your marketing and sales efforts better. And to ensure your offering is attractive to their needs. Characteristics include:

  • Age and gender
  • Income and education
  • Religion
  • Family life cycle,

Examples of Demographic Segmentation are:


The age of the customer is dependent on what attracts them. As they grow older, their tastes change. Even though the functions of your products are similar, one may attract a younger audience, while another product is excellent for an older person.


How much money a person earns will have an effect on their wants and needs. And, of course, their ability to buy their wants or needs. Car buyers are an excellent example of how income can affect the buying decisions of a customer.

What is behavioral segmentation?

How do you react and use a product or service? How often do you buy a product and where do you buy it are questions answered by behavioural segmentation. Behavioural segmentation isolates customers’ buying patterns like the benefits sought from your product or service, usage frequency and how loyal they are to your brand. For example, if you are selling shoes into a specific segment, like children, teens and adults, they will likely have different preferences and needs. Also, people who live near a warm beach are going to have different shoe needs than those who live in the snow-covered hills.


Psychographic segmentation divides your market on lifestyles, personality traits, your Interests, attitudes and values. Therefore, psychographic segmentation allows you to build a picture of the customer by taking into account attitudes. concerns and criteria. Psychographic segmentation allows you to offer more relevant products and services to your customer’s opportunities.


Socioeconomic segmentation compares a person’s income, education and occupation to other people. Allowing you to market correctly to those customers that have the buying power to purchase your products. For instance, the placement of an advertising board offering luxury cars within a high-end tube station, where there is a better chance of someone able to buy your car will see it. Also, advertising your team’s new football shirts near the football ground.


By asking the right survey questions, you learn what your customers do in their spare time, their lifestyle, what they value, and motivates them. And we suggested that there are 4 types of market segmentation with examples. We isolated demographic, geographical, psychographic and behavioural segmentation.

About Octopus Intelligence

Octopus is a global Intelligence service company. Answering the questions to help you grow. We help you beat competitors, increase sales, be disruptive, enter new markets and invest with more certainty with our Strategic and Competitive Intelligence, Due Diligence and good old common sense. We live in an increasingly uncertain, competitive and ever-shifting world. What you need is active real world business development strategy, where deep expertise combines with Competitive Intelligence based actions to answer the what and the how, for the now and the next.

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