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Trends That Will Shape Market Segmentation in 2024

Learn how these five market segmentation trends will help your business compete.

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Written by: Max Freedman, Senior AnalystUpdated Nov 27, 2024
Gretchen Grunburg,Senior Editor
Business.com earns commissions from some listed providers. Editorial Guidelines.
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Even those who are true innovators at heart need to see how dynamically market segmentation can change. As we venture further into the future, there are constantly new factors at play: disruptive technologies, big data or ever-growing consumer demands.

Learning how to build your segmentation strategy around these factors is what defines the leaders of tomorrow — while the others are left behind. Learn below what will keep your business competitive in the current environment.

The importance of market segmentation

Market segmentation is often discussed in lofty terms and explained using tons of jargon. It only makes sense to implement segmentation if you understand why it matters. So, we’ve broken down why it’s important for your business:

  • Discover effective niches within your existing customer base: Market segmentation helps companies plan campaigns and execute advertisements by breaking down larger groups into smaller segments. This practice allows the company to focus on certain customer groups rather than targeting everyone in the market.
  • Find new audiences: Segmenting the market also allows companies to create products that better suit their audiences’ needs. While analyzing a specific group within the marketing scene, segmentation may reveal other areas or groups of people your company has not yet targeted, potentially boosting business.
  • Refine your niche: If a company attempts to broaden its horizons and tries to sell to everyone, the broad generalizations probably won’t make an impact. Companies miss out on opportunities if they do not have a specialized, customizable product or service.
  • Perfect your strategy: Market segmentation can help guide a business to make important decisions regarding the path of the product to the customer — whether it is price, design or distribution. For example, if a company’s target audience prefers to shop online, a company can choose to offer its products in an online store, appeasing market customers. Income levels, demographics and geographical data are other important factors that may influence business decisions.

Market segmentation is here to stay

Market segmentation has become a mainstream method of selecting a market audience. By splitting up the broad market into smaller, more focused pieces, companies can concentrate on their audience and more effectively cater to them. Whether the segmentation breaks down an audience by age, geographic location or behavior, companies can specialize products to adhere to their audience’s wants and needs.

Over the next many years, we will see new, exciting concepts shaking up the ways marketers approach segmentation, but don’t stick to passive observation. Look at how to incorporate these trends into your own operations. This way, you can ensure that your marketers are well-equipped to deliver strategies worthy of the upcoming decade.

Sean Peek and Anthony Lamot contributed to this article.

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Written by: Max Freedman, Senior Analyst
For almost a decade, Max Freedman has been a trusted advisor for entrepreneurs and business owners, providing practical insights to kickstart and elevate their ventures. With hands-on experience in small business management, he offers authentic perspectives on crucial business areas that run the gamut from marketing strategies to employee health insurance. At business.com, Freedman primarily covers financial topics, including debt financing, equity compensation, stock purchase agreements, SIMPLE IRAs, differential pay, workers' compensation payments and business loans. Freedman's guidance is grounded in the real world and based on his years working in and leading operations for small business workplaces. Whether advising on financial statements, retirement plans or e-commerce tactics, his expertise and genuine passion for empowering business owners make him an invaluable resource in the entrepreneurial landscape.
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