Benefits of market segmentation

There are a many benefits that can be resulting from segmenting a market:

1. Segmentation is a useful approach to marketing for the smaller firms. It allows target markets to be matched to company competencies and makes it more achievable for the smaller firms to create a defensible niche in the market.


2. It assists recognizing gaps in the market that are not served or under-served. These can provide areas for new product development or extension of the existing product or service range.


3. In mature or declining markets it may be possible to identify particular segments that are still in growth. Focusing on growth segments when the overall market is declining is a major strategy in the latter stages of the product life cycle.


4. Segmentation allows marketers to match a product or service to the needs of the target market.