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Where is Market Segmentation Useful

In marketing, market segmentation is the process of categorizing potential customers (accounts for ABM) into unique subsets (or “segments”). Every customer in a segment shares similar wants and needs. Hence, all customers in a segment should react similarly to a promotional effort.

Using market segmentation, businesses can appeal to a segment of customers with a tailored marketing and sales strategy.

Why is market segmentation important?

Segmentation could be a time-consuming and expensive process. However, it can boost your business’s bottom line and ensure its continued viability. Let’s understand the importance of market segmentation and where it is functional.

Here are a few reasons why market segmentation is essential.

Enhanced productivity

With market segmentation, your business may target specific demographics with your product promotions. This is more effective and frequently cheaper than trying to appeal to the market as a whole.

Improved prestige as a brand

When developing a marketing strategy, it is necessary to consider how your brand wants to be seen by a specific demographic. After settling on a target audience, you may start thinking about how to convey the message best.

Having a particular audience in mind makes it more probable that your branding and messaging are deliberate. As a secondary benefit, this may lead to happier customers overall.

Possibility for stronger brand allegiance

Customers are more likely to become loyal patrons when you target them with targeted marketing campaigns. Customers may respond positively to more direct, personalized marketing techniques that make them feel valued.

Furthermore, market segmentation improves your chances of engaging the audience which has a higher propensity to buy from you.

Market Segmentation in B2B Marketing Strategy

Many B2B companies divide their customer base into subsets based on criteria like industry, company size, and geographic location. This is a fantastic place to begin, but for your B2B marketing strategy, keep in mind the following as well:

  • There will likely be only a handful of segments. Since your target audience consists only of other companies, you could not have a huge variety of customers. It’s unlikely that there will be more than five parts.
  • Each of your subsets will have its own set of problems. In business-to-business marketing, you need to show how your service will benefit the client company.
  • Sometimes a single company will constitute its market. Don’t be shocked if you direct some of your marketing efforts at a single giant company instead of six smaller ones if 80 per cent of your revenue comes from 20 per cent of your clients.

Examples of market segmentation in B2B marketing

Here are some examples of market segmentation in B2B marketing:

By tiering

In this, customers are placed into different tiers based on how well they fit your company’s goals. Tiered pricing allows you to segment your clientele more precisely, whether by their ability to pay for your premium offering, the length of time they anticipate using your service, or their resemblance to your ideal client.

Prospective customers’ potential contributions to the business are evaluated using a tiered segmentation system.

By customer satisfaction

This sort of division takes a company’s level of development into account. Awareness of your customer’s problem and understanding how your solution addresses it is more important than a customer’s firmographic information or prospective value.

By behavior

Behavioral segmentation can significantly increase the account’s profitability when used with tiered segmentation. How your current clientele engages with or employs your product is a key consideration in behavioral segmentation.

You’ll better understand the product’s value to customers and a heads up on which ones are most likely to defect.

By organization

Customers of your B2B business might be broken down further according to the type of organization. The company segments its clientele based on various criteria, such as industry, size, business model, legal structure, and geographical location. For instance, you may tailor your solutions for small and medium-sized businesses (SMBs) in one sector to those of large corporations in the same sector.


Once you’ve broken down your potential clientele into distinct groups, you’ll better understand how to tailor your content and marketing efforts to each group’s specific wants, requirements, interests, and triggers for making a purchase. Market segmentation is useful for B2B businesses. Follow the tips in the article to start segmentation for your B2B marketing strategy.