Market segmentation


A breakdown of a customer base or population into groups that share important common attributes or needs.


  • A tool that can be used to create personas for designing and testing value propositions.
  • An understanding of the important subgroups within the market, which can assist with market strategies, policy and so on.

Use when

  • You need to design tailored experiences for the needs of different groups.


There are many different ways to segment a market. Demographics are often used. Needs-based segmentation is often more helpful for product and service design projects.

Personas are most useful when they represent a single segment within a market.

Key terminology

Persona: A made up person (archetype), based on user research, that represents a group of users who use a site, service or product in a similar way.