ABSTRACT
Most markets can be broken down into segments. These are distinct slices of the market that demand different things from a particular product range.
4.1 Segmentation and product range The market for cars is a good example: all cars are basically self-powered boxes for moving people from place to place. However, within the car market there are many distinct needs. Retired people, managing directors, sales reps, first-time buyers, farmers, families and commuters all look for something slightly different. They represent distinct segments of the market. Segmentation is also to do with spending power: what people can afford to buy (and therefore the ‘demand’ they generate) depends to a large extent on their income. In most markets, there are three broad segments based on income, like this.
