Market segmentation is the process of separating the varied market into segments, each of which has similar characteristics. For example, a cosmetic company may segment its market according to age and sex, thus concentrating on baby lotion (age), adult shampoo (age), after-shave (sex) and eye-liner (sex). The organization could then do research in each segment to study how large a market is for its products and arrive at products that is of high value and quality for that particular segment.
1. Williams C. (2007). Management (4th ed., ). Thomson South Western.