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Characteristics of markets and market segments
Potential: the segments and markets should have adequate potential for marketing objectives, such as profitability.
Attractiveness: segments should be organizationally pleasant to the producer. That is, they should make a competitive advantage for the company.
Relevant: The size of a market segment must be big enough to economically validate the separate marketing activities.
Accessible: Segments and markets have to be servable for the organization.
The importance of market segmentation
Higher Profits: segmentation enables formulation of quality subdivisions for clients to agree to higher prices. Exclusive points of sale, product variations distinguish segments from the mass market. Segment-based price gap is regional. That is why there is higher price level in big cities.
Opportunities for Growth: Marketing plans for certain segments allow individual approach to client groups. Organizations can form their functional products and thus attract additional client groups when a segmentation strategy is based on customer loyalty.
Viable Client Relationships in Clients' Life Cycle: clients change their conduct patterns and preferences overtime. Organizations with many segments alongside a client's lifecycle guide their clients from one stage to another. For instance, car manufacturers give products depending on clients' phase in life.
To Serve Customers' Needs In A Better Way: a variety of customer needs is satisfied with limited products' range via the use of different packages and promotional activities. For instance, Dell's website is organized by clients groups and not product groups. Dell offers the same product to all clients saving for the corporate clients and increasing the chances for cross selling.
Bases commonly used to segment consumer markets
Geographic Segmentation: these variables include; region which involves country and continents or state, the metropolitan area size, population size and density and the climate.
Demographic Segmentation: these variables are; age, gender, family size, family lifecycle, income, occupation, education, ethnicity, nationality, religion and social class.
Psychographic Segmentation: it classifies clients on their lifestyle, activities, interests and opinions.
Behavioristic Segmentation: is founded on actual clients' conducts toward products. Behavioristic variables include; the usage rate, brand loyalty, readiness and occasions.

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