User Segmentation

CORE DEFINITION

The practice of partitioning a market into subgroups whose members are similar to one another and different from members of other groups, using demographic, behavioral, psychographic, or geographic criteria. It is the prerequisite for targeting and positioning, since a value proposition can only be specific if the audience is. Effective segments must be measurable, large enough to serve profitably, and reachable through available channels. Segments should be defined by differences that change behavior or willingness to pay, not by whatever data happens to be convenient, and data advances have shifted practical granularity toward individual-level personalization.