Difference Between Segmentation and Targeting

In this modern world, the more a thing is showcased the greater its chances for acceptance and fame. There is a whole horizon to this field and is called marketing. Launching a new product brings with it a bunch of other important factors to cater to. Market segmentation and targeting is a process for product launch in which the team identifies the company’s potential customers.


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Test your knowledge about topics related to business

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Which of the following is not an economic activity?

2 / 10

Importing goods for the purpose of re-export is termed as ___________.

3 / 10

If a general manager asks the sales manager to recruit some salesman on his behalf, it is an instance of ___________.

4 / 10

Modular furniture __________.

5 / 10

The method of evaluating the efficiency of workers is termed as _________.

6 / 10

The management of the company is entrusted to __________.

7 / 10

Over-capitalization results from __________.

8 / 10

Overall and strategic planning is done by the ___________.

9 / 10

Working capital means _________.

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A building jointly owned is called office________.

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Segmentation vs Targeting

The difference between segmentation and targeting is that segmentation is the process in which the consumers are divided into different groups called segments on the other hand targeting is the process of choosing one beneficial segment among the previously made segments to focus on.

Segmentation is done by dividing the end consumers into different groups based on many factors which include geographical, behavioral, and demographic attributes of the inhabitants. Also, their lifestyle is focused too. This helps make different segments of people with the same characteristics, that later leads to finalizing the potential consumers.

Segmentation is followed by targeting. Targeting is the step in which the selection is done between all the segments and one segment is identified and focused on to provide the services and products. Then the company’s best plans are made keeping in mind the preferences of the selected segment’s people.

Comparison Table

Parameters of ComparisonSegmentationTargeting
Stage of processFirst stageSecond stage
MotivationThe entire market is the motivationOne segment of the selected market is the motivation
GoalDividing the market into groups of people with the same characteristicsSelecting one group of people to provide the services and products.
BasesInterests, lifestyle, location, age, sex etceteraThe attractiveness of the selected segment
FocusCustomers with the same attributesMaking the right choice for the company’s best resources

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What is Segmentation?

Segmentation is the first step of the STP (Segmentation, Targeting, Positioning) marketing model. When a company decides to launch a product or any new service its foremost task is to find out the potential consumer so that the product can be launched with its full zeal and impact.

In segmentation, the entire market is divided into groups of people who have the same characteristics. These characteristics can be many like people with the same age, sex, location, lifestyle, career, interests etcetera.

Mainly there are four factors of segmentation, based on which the market is segmented. They are as follows:

The first is demographical. In demographical factors comes age, race, gender, nationality, religion, income, occupation, social class, and family status.

The second is geographical. It is based on the location of the residence. This highly impacts the buying behavior of people.

The third is behavioral. This segment is based on the customer’s conduct towards a certain product. It is affected by the benefits of the product. Also, how much the customer is loyal to the brand, and the usage of the product, falls in this category.

The fourth is psychographics. The lifestyle, interests, opinions, attitudes, and beliefs of the customers fall into this category.

What is Targeting?

Targeting is the second step of the STP marketing model. Once the company is done with dividing the entire market into multiple groups, then comes the stage where one segment is to be selected to focus on the launch of the product or services to be provided by the company.

The targeting is done based on many factors like the profitability of the segment, its size, other competitors in the same niche, the type of the product being launched, and the resources of the company being used. It is one of the foundations of the marketing plan.

Once a segment is chosen, then the company comes up with its best tactics to overcome the selected market. The company decides the benefits to be offered with the product or service. This value proposition is then communicated to the market with the help of advertisements, campaigns, and sample distribution for a free trial.

The target market needs to be tested before the launch to ensure a foolproof plan. After the product or service launch, the company should keep tracking and monitoring the target market. There should be a check on the sales, customer surveys, and other tools to track the demand of customers.

Main Differences Between Segmentation and Targeting

  1. Segmentation is the first step of the STP (Segmentation, Targeting, Positioning) model while targeting is the second step of this model.
  2. Segmentation is the division of the entire market into multiple segments, while targeting is the selection of one segment.
  3. The aim of the segmentation is to highlight the likeliness of people with the same characteristics, while the aim of targeting is to highlight the profitability of the selected segment.
  4. The result of segmentation is multiple groups of people the with same attributes, while the result of targeting is one strong segment that will give maximum profit for the product.
  5. Segmentation involves the entire market while targeting involves only the people from the chosen segment of the market.
  1. https://www.taylorfrancis.com/books/mono/10.4324/9780203862483/handbook-market-segmentation-art-weinstein
  2. https://link.springer.com/chapter/10.1007/978-3-319-49849-2_4
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