Segmentation

Segmentation consists in analytically dividing a market into homogeneous sub-markets.

They are a few segmentation techniques, such as principal component analysis (PCA), k-means clustering, and hierarchical agglomerative clustering. The segmentation usually contains two or three levels of nested clusters.

There are several types of segmentation, such as:

• Dynamic segmentation
• Psychographic segmentation
• Geodemographic segmentation