Introduction

Market segmentation is a very important field of study for marketers because it enables companies to target different categories of consumers who perceive the full value of certain products and services differently from one another. Market segmentation is adopted by marketers of consumer goods, retailers, hotels, and industrial marketers.

Before proceeding with the exploration of this concept, the term marketing and segmentation should be defined.

Marketing:
The term marketing refers to the medium that allows buyers and sellers to interact in order to facilitate an exchange of a specific good or service. The price that individuals pay during the transaction may be determined by a number of factors, but price is often determined by the forces of supply and demand.

Segmentation:
As for the term segmentation, it refers to the process of dividing a large unit into various small units which have more or less similar or related characteristics.
In other words, the concept of market segmentation can be defined as marketing concept which divides the market set up into smaller subsets which includes consumers with a similar taste, demand and preference.
Each subset is different from the other one. These consumers think on the same lines and have similar interests, and respond in a similar way to the fluctuation of the market.