Difference Between Market Segmentation & Target Market

Steve Hix/Somos Images/Fuse/Fuse/Getty Images

Market segmentation and target marketing are two steps of the marketing process. Although the two go hand-in-hand, there are distinct differences between them, as market segmentation must take place before a target market is determined.

Processes

A couple shops online at home on the couch with a tablet computer.
Goodluz/iStock/Getty Images

Market segmentation occurs when a company decides that they want to identify a specific type of consumer to which they can market their product or service. A target market is determined once the company identifies which consumers to sell to.

Function

A woman making a decision in the grocery store.
gpointstudio/iStock/Getty Images

According to Kotler and Armstrong’s Principles of Marketing, market segmentation is used to research the entire market as a whole and then place consumers into separate groups based on common characteristics. The company then decides which group is best and concentrates on selling to them, which is also called target marketing.

Features

A man shops at an outdoor market in the city.
Huntstock/Huntstock/Getty Images

Market segmentation may be based on variables such as behavior, demographics (e.g., gender, age, education, and income), geography, and psychographic characteristics, or those based on lifestyle and personality.

Identification

Girls pick out toys in a toy store.
Fuse/Fuse/Getty Images

A target market is identified once a company evaluates all possible market segments and determines which would be the most appropriate, and therefore profitable.

Positioning

A family watches television and use a laptop in the living room together
Mike Watson Images/moodboard/Getty Images

Marketing a product through advertising, also known as positioning, cannot be properly executed before market segmentation takes place and a target market is determined.

References

  • Principles of Marketing; Philip Kotler and Gary Armstrong; 2006

About the Author

Kristeen Cherney began writing healthy lifestyle and education articles in 2008. Since then, her work has appeared in various online publications, including Healthline.com, Ideallhealth.com and FindCollegeInfo.com. Cherney holds a Bachelor of Arts in communication from Florida Gulf Coast University and is currently pursuing a Master of Arts in English.

Photo Credits

  • Steve Hix/Somos Images/Fuse/Fuse/Getty Images