When I started my first job at Elastic Grid, I worked with major IT companies, helping their resellers market their products. My role was specifically in email marketing, where we built landing pages, crafted email copy, and created templates for resellers. The process was simple: resellers provided an email list, and we managed the email nurture flows, measuring performance through reports and following up with their sales teams.
But very early on, I noticed a glaring flaw. The messaging in these email blasts was generic, almost painfully so. And when I looked at the email lists, I realized we had a ton of useful information about these people that we weren’t using. It felt like a massive missed opportunity. Even though it would take me more time to create custom-tailored messaging for different segments within the list, I was convinced it would be worth it. So I took the extra step, adjusted my approach, and focused on crafting messaging that actually resonated with different audience segments.
The result? My campaigns performed significantly better than those of my peers. Higher engagement, stronger conversions, and—most importantly—actual pipeline revenue generated. That experience shaped my approach to marketing forever. Segmentation isn’t just a checkbox for me—it’s something I teach early on when working with teams, because understanding your audience and personalizing your messaging is the difference between marketing that just exists and marketing that actually works.
The 5+1 Types of Segmentation (And Why They Matter More Than You Think)
Most people talk about four types of segmentation, but there are actually six that matter if you’re serious about marketing that drives results:
- Demographic Segmentation: The easiest and most commonly used form. This includes basic details such as age, income, education level, occupation, and marital status. While it’s an easy starting point, it’s also the least insightful. Knowing someone is a 30-year-old male making $70K a year doesn’t tell you why they buy or what they value.
- Behavioral Segmentation: This is where things get interesting. How people interact with your brand—what they buy, how often, how much they spend, their engagement level—tells you way more about what they actually need. If a customer always buys after receiving a discount email, that’s a behavioral insight you can use.
- Psychographic Segmentation: This goes deeper than behavior. What are their values, motivations, lifestyle choices, and personality traits? This type of segmentation is more challenging because it requires qualitative research, but it’s also where true brand differentiation happens. People buy based on identity as much as they do on needs.
- Geographic Segmentation: Location matters more than people think. Climate, culture, urban vs. rural dynamics, and regional economic differences all play a huge role in how people make purchasing decisions. Selling winter tires? Target people in snowy regions. Simple but effective.
- Firmographic Segmentation: The B2B equivalent of demographics. This includes company size, industry, annual revenue, and growth stage. If you’re selling enterprise software, segmenting based on a company’s number of employees or technology stack is critical.
- Technographic Segmentation: What tools or software does a business (or consumer) already use? For B2B marketers, this is essential. If your software integrates only with HubSpot, then targeting companies that use Salesforce is a waste of ad spend.
Most businesses need a mix of these to create useful customer segments. The key is not just knowing the categories but understanding how to apply them strategically.
The Most Misunderstood Type: Behavioral Segmentation
Behavioral segmentation is where most marketers either shine or crash and burn. The way someone interacts with your brand is often the most predictive indicator of future actions, yet many teams fail to leverage it effectively.
For example, let’s say you run a SaaS company. You have two users:
- User A logs in every day, engages with your features, but hasn’t upgraded from a free trial.
- User B purchased a premium plan but hasn’t logged in for three months.
Who do you focus on? The instinct might be to chase User A and push them toward conversion, but User B is actually more at risk. This is where behavioral segmentation helps—by identifying high-value users who are slipping away and need re-engagement.
Other behavioral segmentation factors to consider:
- Purchase frequency (Are they one-time buyers or repeat customers?)
- Engagement levels (Do they open emails? Visit your site? Attend webinars?)
- Triggers for purchasing (Do they buy after a discount? After seeing a demo?)
Many businesses ignore behavioral data in favor of broad demographic assumptions, which is why they struggle to improve conversion rates.
Why Your Segments Should Actually Make You Money
Too many segmentation efforts end up as PowerPoint slides instead of actual revenue-generating strategies. Almost every company I’ve worked at had the best-case scenario of a PowerPoint deck outlining their segmentation model. However, these rarely got incorporated into actual marketing strategies, making them largely ineffective. I know you’ve seen it too—it’s segmentation for the sake of segmentation, not for driving business results.
A few ways strong segmentation drives business growth:
- Smarter Ad Targeting: If you know that your best customers are frequent travelers, your ads should be speaking directly to their needs—not casting a wide net to anyone who likes “vacations.”
- Higher Conversion Rates: If mid-sized tech companies using Salesforce are your best customers, why are you wasting resources targeting solopreneurs?
- Better Product Development: If customer data shows that users keep requesting a specific feature, that’s a massive sign for your product team.
Every segment you create should have a clear action attached to it. If you can’t answer, “What marketing decision will this segment improve?” then it’s probably not useful.
Final Thought: Good Segmentation Should Feel Obvious in Hindsight
If your segmentation work leads you to an insight so clear that you feel dumb for not realizing it sooner, you’ve done it right. The best segmentation doesn’t just categorize your audience—it helps you see them in a way that makes your marketing sharper, your sales more effective, and your product decisions smarter.
The marketers I see winning today are the ones using segmentation as a real strategy, not just a checkbox on a marketing plan. So, are your segments actually helping your business, or are they just sitting in a slide deck collecting dust?
