Market
segmentation is a business strategy that divides a broad market into subsets of
buyers with common needs and priorities in order to target them more
effectively.
All
too often, however, marketing departments get all tied up in the challenge of segmenting
their markets, but they forget why they are doing it. They need to remember the
reason for the exercise. The end game—increasing sales—is the purpose.
When
you think of segmentation in terms of sales territory management, it refers to
dividing up territories into common units so that sales within that territory are
more efficient and effective. Territories can be segmented according to a
variety of criteria:
- Geographic
- Customer needs
- Product offerings
- Sales potential
