When launching a business, an examination of the market is one of the major business plan constituents. However, the notion of the market consists of a number of definitions often confused. The examples of such definitions are the market segmentation and the target market. Although these terms are often misinterpreted and mixed when used together, there is a significant distinction between the processes they denote. Market segmentation primarily concerns the process of dividing the market in terms of gender, financial status, geographical location, and many aspects, which can potentially benefit the business (Curtis and Sierra). The target market, on the contrary, is the already chosen segment, which constitutes the customer in which a particular business is highly interested. Hence, although the perception of these notions was unclear in the past, now the difference between them is quite obvious for me.
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There are many ways to segment the market in order to define the target market. Some of the most significant are the demographic, geographic, and psychographic segmentation (Ahmed). They are crucial for the business marketing, as the demographic segmentation, for example, deals with dividing people of various age, gender, ethnicity, or race groups to establish potential consumers. Geographic segmentation focuses on defining businesses according to the location peculiarities. Psychographic segmentation, in its turn, copes with the customers’ lifestyles and behavioral patterns. Thus, market segmentation is crucial in terms of estimating an accurate target market and, consequently, gaining the business profit.
As a result of market segmentation, there exists a great variety of target markets, according to which businesses are tailored. For example, some of the major geographically estimated target markets are the European, the US, and the South American markets. In order to launch a successful business, a brand should consider the average lifestyle and income rates of each region, which differs greatly in this context. The following target markets are later divided into smaller and more accurate groups, which helps businesses define their profitable marketing destinations.
Curtis, Kynda R., and Sierra Allen. “Target Market Identification and Data Collection Methods.” (2018).
Ahmed, Anam. “Difference Between Market Segmentation and Target Market.” 2019. Web.