Taking your market research to the next level with needs-based segmentation

photo of a baker writing in a book

w product or service?  

Step 1:identify your segments 

The first step towards achieving this goal is a process called “needs-based segmentation.” Needs based segmentation is a fancy phrase for dividing a broad market into groups of customers with similar needs. We conduct this process to evaluate, compare, and select market segments to enter.  

For example, a small clothing store that sells 100% sustainable cotton clothing is trying to grow their business by breaking into a new segment. They have noticed an uptick in the people coming into their store who are sustainability-minded and wonder if there is an opportunity here to expand their  business with other product lines.  

Step 2:Profile these market segments 

The next step is profiling this market segment (in this case– sustainably minded shoppers). To successfully profile a segment, you should be able to answer the following questions:  

  • What are the characteristics of the segment?  
  • What are the needs, motivations, and issues to solve in the segment?  
  • How are they meeting their needs today? 
  • Is this segment specific to any location/geography? 
  • What’s an example of a customer in the segment?  
  • What are key trends in this segment?  
  • What is the buying force of this segment? 

Once we have successfully profiled a market segment, (a) target specific customers to invest in products to specifically meet their needs, and (b) focus marketing and sales efforts in the most effective way possible!  

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