It is important for you as a business owner to know the steps of market segmentation if you are going to segment the market but first Market Segmentation is a process of dividing a broad consumer or business market, according to the characteristics of a group of customers.
Steps in Market Segmentation
1-Determine the need of the segment
This is the first step of market segmentation, getting to know to the customer’s needs. as a business owner, You should think what would each of your customer like to have so you could give them what they need.
For example, in a small town, there is no dentist and you are opening a hospital so you must have a place for a good dentist.
2-Identifying the segments
In this step, you need to answer the who question. Who will you target based on what geographic, demographic, psychographic or what? The 1st step gives you a mass of crowd, and in the 2nd step, you have to differentiate the people from within that crowd.
From the example above there about the dentist, in this step, you should know who will be your target children or adults.
3-The attractive segment
In this step, you will have to choose the most suitable segment for you. If you are using psychographic segmentation, then you need to target the psychology of consumers which takes time. So you will not be able to expand faster. But if your product is basic, then you can use demographic segmentation as the base, and expand much faster in surrounding regions.
4-The profit of the segment
You have chosen one of the segments but which one of those segments is most profitable is a decision to be taken in the 4th step. This is also one more targeting step in the process of segmentation.
5-Positioning for the segment
In the fourth step, you have chosen the best profitable segments so now you must position your product in the mind of the consumers. Like the example above you need to make people remember the name of the dentist.
6-Expanding the segment
It is time now for expanding your brand or whatever you are marketing for if you have found a segment, that it should be such that the business is able to expand with the type of segmentation chosen.
7-Segmentation and Marketing strategy
How do you think Americana or KFC became such a big chain of fast food they adopted other variables of marketing strategy as per the segment being targeted.
Finally, why do you think that Why is market segmentation is important? it makes it easy and clear for you to personalize your campaigns and by arranging their company’s target market into segmented groups, rather than targeting each potential customer individually, it makes you more efficient with their time, money, and other resources than if they were targeting consumers on an individual level.