What are forms or bases of market segementation? And why is there for market segmentation?

Market segmentation is the first step in defining and selecting a target market to pursue. Basically, market segmentation is the process of splitting the overall market into two or more groups of consumers. Each group (or market segment) should be similar in terms of certain characteristics or product needs. It's a tool to enable marketers to better meet customer needs. Steps: a. Distinct segments for key accounts and small accounts. b. Perform demographic or firmographic market segmentation. c. Cluster analysis for customers with diverse needs. d. Code of existing and prospective customers. e. Implementation of market segmentation.

BASES OR FORMS.

Geographical-regional, area, country

Demographic-Age, sex, income levels, education

psychological-social class, lifestyle, persinality

Behaviorial-product usage, brand loyalty.

why is it necessary for segmentation?

Better matching of customer needs.

Better opportunities for growth.

Customer rentention & enhancement.

Target marketing communication- business has to deliver their marketing message to relevant customer audience because the market is broad, some customers may miss out & also the cost for communicarion is also very high.

Enhanced profits