Segmentation refers to the process of dividing a larger target audience into smaller, more homogeneous groups based on shared characteristics such as demographics, behaviors, or motivations. In product development and marketing, segmentation is used to identify specific subgroups within the target audience, allowing companies to tailor their offerings and marketing strategies to meet the unique needs and preferences of each segment. This enables companies to create more targeted and effective marketing campaigns, as well as develop products that better meet the specific needs of different customer groups.
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Segmentation also allows companies to identify the most profitable and lucrative segments of their target audience, and allocate resources more effectively to reach these customers. By utilizing segmentation, companies can gain a deeper understanding of their target audience and develop more effective strategies for connecting with and satisfying their customers.