Copyright

How to Segment Business Markets Step-by-Step

Lesson Transcript
Instructor: Jennifer Lombardo

Jennifer Lombardo received both her undergraduate degree and MBA in marketing from Rowan University. She spent ten years in consumer marketing for companies such as Nielsen Marketing Research, The Dial Corporation and Mattel Toys. She is currently an adjunct professor of marketing at Rowan University and a social media marketing consultant.

There are four main types of business markets: producers, resellers, government, and institutions. Learn how to segment business markets step-by-step by identifying company characteristics and buying processes, and how these segments help businesses develop marketing strategies. Updated: 08/19/2021

Business Markets

You may have heard the term 'B2B'. B2B stands for business-to-business marketing. The business market is where companies sell their products or services to other businesses. Business markets can also be segmented into easily identifiable areas. The town expert is Postmaster Joe because he knows the area better than anyone, and he is going to give us a tour of Ninja Town to explain how businesses are segmented.

An error occurred trying to load this video.

Try refreshing the page, or contact customer support.

Coming up next: Positioning and Differentiation in Consumer Marketing

You're on a roll. Keep up the good work!

Take Quiz Watch Next Lesson
 Replay
Your next lesson will play in 10 seconds
  • 0:04 Business Markets
  • 0:31 Four Broad Business…
  • 1:25 Segmenting by Company…
  • 2:37 Segmenting by Buying Processes
  • 3:37 Lesson Summary
Save Save Save

Want to watch this again later?

Log in or sign up to add this lesson to a Custom Course.

Log in or Sign up

Timeline
Autoplay
Autoplay
Speed Speed

Four Broad Business Market Segments

Postmaster Joe's territory is huge. He covers the entire southern part of Ninja Town and sells companies metering machines and other mailing products. He also delivers mail to all four different types of business markets, which are producers, resellers, government and institutions. A Ninja Town producer would be the steel factory that produces the material for the local automakers. Postmaster Joe visits a few resellers every day on his route. Resellers buy products and then resell them to other businesses. Some examples include distributors such as food warehouses and brokers. Postmaster Joe's route covers a ton of government markets, such as the navy yard, motor vehicle department and defense contractors. The last segment that the mailman visits every day consists of institutions such as hospitals, prisons, churches and libraries.

Segmenting by Company Characteristics

Postmaster Joe loves his route and all of the businesses in town. He agrees with the business marketing strategy of segmenting according to company characteristics. He divides his route up as well in the same manner. Company characteristics include segmentation variables of company size, product use, geographic location and even type of company. He uses geographic segmentation for his route, as it makes his route efficient and productive to deliver mail in order of location.

To unlock this lesson you must be a Study.com Member.
Create your account

Practice:
How to Segment Business Markets Step-by-Step Quiz

Instructions: Choose an answer and click 'Next'. You will receive your score and answers at the end.

1/5 completed

You want to find an efficient way to segment the business market. Which of the following is NOT an example of how you should segment a market according to company characteristics?

Create Your Account To Take This Quiz

As a member, you'll also get unlimited access to over 84,000 lessons in math, English, science, history, and more. Plus, get practice tests, quizzes, and personalized coaching to help you succeed.

Try it now
It only takes a few minutes to setup and you can cancel any time.
Already registered? Log in here for access

Register to view this lesson

Are you a student or a teacher?

Unlock Your Education

See for yourself why 30 million people use Study.com

Become a Study.com member and start learning now.
Become a Member  Back
What teachers are saying about Study.com
Try it now
Create an account to start this course today
Used by over 30 million students worldwide
Create an account