geographic segmentation essay

Geographic Segmentation Explained With 5 Examples

Published: Aug 27, 2020

Updated: 21/10/2022

Learn how to effectively use geographic segmentation in your eCommerce marketing strategy. Get inspired by real-world examples from industry-leading brands.

There is no easier route into personalized marketing than market segmentation . By breaking down your customer base into groups, you can target your resources and ensure your audience receives the messaging that is most relevant to them.

There are 4 main types of market segmentation , and each offers a different way to define an audience:

• Demographic segmentation – grouping customers by identifiable non-character traits like age, gender, or income.
• Psychographic segmentation – grouping customers based on their personalities and interests, including beliefs, hobbies, and life goals.
• Geographic segmentation – grouping customers with regards to their physical location.
• Behavioral segmentation – grouping customers based on their past actions, like spending habits, browsing habits, and brand engagements.

The premise is simple enough, but the key to successful market segmentation is understanding exactly how it can best work for you. Today we’re going to do a deep-dive on geographic segmentation , and discover all the different ways your marketing can benefit from it.

What is geographic segmentation?

Geographic segmentation involves segmenting your audience based on the region they live or work in. This can be done in any number of ways: grouping customers by the country they live in, or smaller geographical divisions, from region to city, and right down to postal code.

Geographic segmentation might be the simplest form of market segmentation to get your head around, but there are still plenty of ways it can be used that companies never think about.

The size of the area you target should change depending on your needs as a business. Generally speaking, the larger the business the bigger the areas you’ll be targeting. After all, with a wider potential audience, targeting each postcode individually simply won’t be cost-effective.

In total, there are six factors that pertain to geographic segmentation and can be used to create customer segments:

• Location (country, state, city, ZIP code)
• Climate and season
• Cultural preferences
• Population type and density (urban, suburban, exurban or rural)

Geographic segmentation benefits

Easy to implement.

Geographic segmentation is different from the other types of market segmentation (especially psychographic and behavioral ) because it requires fewer data points .

As a result, it offers a quick and effective route into personalized marketing and can offer tangible ways to reach potential customers using only their location as a starting point.

Higher product relevancy

This helps not only to improve sales but also creates a better relationship between customer and business. Presenting relevant items to customers improves user experience , reducing the amount of effort they need to put in to find what they want.

Improved advertising effectiveness

By presenting more targeted ads, you’ll guarantee that more of your marketing budget is spent reaching relevant customers, and less wasted on those who have no need or interest in your product.

This isn’t to say that geographic segmentation is always the best strategy to employ. It has specific uses for specific businesses and industries. Small businesses working in localized areas will benefit immensely from targeting their marketing to just these areas. Big businesses with products that will have consumer hotspots in specific regions will also benefit.

An international manufacturer of big four-wheel drive vehicles will achieve more sales targeting customers in rural areas than those who drive congested city streets.

But businesses that sell products that do not depend on region-specific patterns won’t benefit as much from geographic segmentation. Consumers of Corn Flakes are likely to be as common in one region as the next.

Geographical parameters by which to segment

There are several geographical parameters you can use, these include:

Getting the obvious out of the way. Segmenting by location gives you a lot of options. It could be a city, a town, different countries, or even a continent. This can also be used to identify a new geographic location your business may wish to expand into.

Do you think they are buying winter tires in Dubai? Segmenting by climate helps you identify areas where the climate is appropriate for your product or service.

When addressing your target market you need to account for cultural variations and sensitivities. For example, In Western cultures, white symbolizes purity, elegance, peace, and cleanliness. However, in China white represents death, mourning, and bad luck.

This can either focus on density or population type. A brand may choose to focus on a densely populated city area, for example, a fitness chain wouldn’t set up a gym in a rural area. You can also overlay demographic information here to find target audiences.

Urban, suburban and rural

These three different environments all need different and specific marketing strategies as customer needs are different. Those in cities and suburbs tend to have more purchasing power than rural areas, so products can be more expensive.

Not every country in the world wants or can be marketed to in English. If you’re running a marketing campaign it will be essential it’s done in the local language. You’ll need to make sure you’re ready to enter a market if all your marketing messages are going to need to be changed.

Geographic Segmentation Examples

An example of geographic segmentation is an ice cream company segmenting a country by how hot different regions are and targeting those specific areas that are hottest and therefore more likely to buy ice cream.

But that’s a very basic example.

There are however a number of different variables that you might consider when setting up your own geographic segmentation. These are the different ways you might choose to target consumers once you’ve decided on the location you want to focus on. Let’s look at how each might best be used.

Example 1: Segmenting based on location

Though all geographic segmentation involves grouping customers by the area they live or work in, here we’re talking about selling purely based on the availability of a product to a certain area. This is a tool that is useful to businesses that only have the infrastructure or facilities to serve customers within certain boundaries.

The food box subscription service Oddbox has, until recently, only had the infrastructure to deliver within the borders of London. However, they have now expanded to deliver to another nearby city, Brighton.

Using geographic segmentation they were able to target potential customers living in the city and deliver relevant marketing via social media ads . See their ads targeting Londoners and Brighton residents back to back above. As a result, users who weren’t previously aware of Oddbox can be shown the service now available to them.

For bigger, global brands segmentation by country becomes even more important. One brand that always hones it’s advertisements to the country it’s targeting is McDonald’s.

To see exactly how they do this watch the video below.

Whilst the above videos can be used to address an entire country, some brands choose to go even more local and focus on specific cities.

One brand that tried this was Nike with their “Nothing Beats A Londoner” video. The video does a great job of addressing football fans in London by including key landmarks, local football stars, and general life in London. It worked so well that it shot to the top of YouTube’s trending chart within hours. It was even covered by national newspapers ,  tweeted by London mayor Sadiq Khan , racking up millions of views in the process.

Example 2: Segmenting based on time zone

Time zone marketing is most useful to large businesses, as they are more likely to be operating across multiple time zones. It can also be of interest to smaller businesses if they operate in nations that have more than one time zone, as the United States.

Email marketing is an area that can hugely benefit from segmenting by time zone. Whilst big announcements and press releases should generally be shared at a set time, generic email marketing often benefits from being seen at a certain time of day.

If you are looking to have your customers read your email first thing on a Monday morning, segmenting by time zone allows it to arrive at 8:45 am local time, putting your email right at the top of the pile.

Example 3: Segmenting based on climate and season

There’s nothing worse than a badly targeted advert – except being caught without a winter coat in the middle of a deep freeze. Marketing based on the climate or season in a specific location allows you to present the most relevant information to your audience.

Seasonal offers tend to run for long periods, like the IKEA promotion above, which was marketed to British customers just as the summer kicked in. They can also be extremely time-sensitive, like a supermarket’s promotion of ice cream during an unexpected heatwave.

If you’re targeting an area that is consistently hot, or perhaps for the duration of summer months you could get a bit more creative. The below example from Coca-Cola does just that.

The below outdoor advertisement is in Dallas, Texas. Summer temperatures here are consistently above 95 ° F so the ad works really well.

Example 4: Segmenting based on cultural preferences

Different regions will have different values that determine whether or not customers decide to make a purchase. In some cases, these values will be determined by the dominant local religion or long-standing traditions and customs, but in other cases, they can be more esoteric local habits that nonetheless need to be understood and catered for.

One of the most common considerations for food manufacturers is religious dietary restrictions. Companies like Haribo that primarily sell gelatin-based sweets, use slightly adapted recipes to cater to the needs of certain demographics.

The German-based company’s main factory in Bonn and their UK factory in Pontefract create their standard range of sweets. Their base in 99% Muslim-majority Turkey, however, makes and markets only halal gummies, using bovine gelatine instead of the porcine gelatine found elsewhere. 

From an advertising point of view it’s also important to consider local culture. A recent example of this is Toyota’s TV adverts for its new car the Camry.

In total eight commercials were made to target different demographics across America.

Toyota even went one step further and ran the commercials in between TV Programmes whose main viewership matched the ads. People would see different commercials based on whether they were watching “Scandal” on ABC, which has a high number of African-American viewers, VS a Spanish-language network show on NBC such as Universo.

Example 5: Segmenting based on population density

Another variable to consider is the density and type of the population in the area you’re targeting. People living in urban areas have very different experiences than those in suburban, exurban, or rural regions.

Being able to segment by population density is especially useful for home and garden retailers. Imagine you’re someone like Home Depot. You probably shouldn’t pitch city-dwellers an electric riding lawn tractor, when you’d have much more luck marketing them a manual push reel lawn mower, which takes up less space and is suitable for small garden maintenance jobs.

Don’t forget about the other types of market segmentation

Overlaying other types of market segmentation on top of these geographic parameters will allow you to drill down to a specific target market you can run targeted advertisements to. This ultimately will help you achieve customer growth and product sales.

• Psychographic segmentation
• Demographic segmentation
• Behavioral segmentation

In conclusion

Market segmentation is such a powerful tool for reaching your customers in ways that feel relevant and useful to them. Geographic segmentation is perhaps the simplest way to get your foot in the game.

Think about exactly how your company can best benefit from it: Are you a big company that can utilize different messaging across different regions, or a small business that stands to get a lot more bang for their marketing buck if they target their local area? Maybe your product will be of particular interest to city-dwellers, or most in-demand during certain seasons.

Whatever the case, there’s an opportunity to use geographic segmentation to your benefit.

Get in touch with Yieldify to discuss using audience segmentation to personalize your customer experiences!

Geographic segmentation FAQs:

Geographic segmentation is a marketing strategy that presents potential customers with targeted messaging based on their geographic location.

A great example of geographic segmentation is a clothing retailer that presents online customers with different products based on the weather or season in the region they reside in. A customer in New York will require much different clothing in the winter months than one living in Los Angeles.

Geographic segmentation is used by companies across many sectors, but it’s most useful to businesses selling goods that might be affected by changes in climate or local customs. Companies with very defined regional interest, like sports teams, or small businesses offering local delivery, also benefit from marketing targeted this way.

Join 1000+ brands worldwide generating more revenue with Yieldify

• Share on Twitter
• Share on LinkedIn
• Share on Facebook
• Share on Pinterest
• Share through Email

Geographic Segmentation: Definition, Variables, Challenges & Tips

Melissa is a seasoned social media strategist and marketer who was recently awarded the Independent Consultant Award by Women in Marketing Community Interest Company. With a deep passion for understanding the ever-evolving digital landscape, she has developed expertise in leveraging social and content platforms to drive engagement and business growth.

By leveraging location-based insights, you can use geographic segmentation to take your personalization efforts to the next level. Here's how to reach customers in specific markets.

If you’re a marketing leader, you know what it’s like to be under pressure. You’re expected to cut through the noise of everything else, and to deliver campaigns that drive meaningful customer engagement with your target audience. While demographic data provides a strong foundation, the reality for most companies is that your customers are spread out.

That's where geographic segmentation is your best friend. By leveraging location-based insights, you can take your ABM personalization efforts to the next level, crafting hyper-targeted strategies that resonate with customers in specific markets, whether that's a different country, state, or even city.

In this article, I'll unpack the power of geographic segmentation, share the key variables to consider, and reveal some of my best practical tips to help you overcome common challenges and elevate your location-based marketing.

What Is Geographic Segmentation?

Geographic segmentation is the process of dividing a market into distinct groups based on their physical location, whether that's by country, region, state, city, or even neighborhood. By understanding the unique characteristics, behaviors, and pain points of customers in specific geographic areas, you can develop highly targeted campaigns to better resonate with them.

Geographic segmentation is particularly valuable in account-based marketing (ABM) strategies, where the focus is on building deep, personalized relationships with high-value target accounts. By using this type of customer segmentation and analyzing the geographic locations of key decision-makers within your target accounts, you can tailor your messaging, channels, and product features to align with the specifics of those localized audiences.

Segmentation vs targeting

It's important to understand the distinction between geographic segmentation and targeting, as these two concepts work hand-in-hand.

Basically, geographic segmentation provides the insights you need to identify your most valuable target markets, while targeting determines which of those locations you will prioritize and how you will engage customers in those regions. By leveraging both strategies in tandem, you can maximize the efficiency and effectiveness of your location-based marketing initiatives.

Geographic Segmentation Variables

Capturing the right geographic data is essential for sending effective location-based marketing messages to your target account list . Here are some of the key variables to consider when segmenting your customer base:

The most fundamental geographic variable is the physical location of your customers. This can include countries, specific regions, states, cities, and neighborhoods. Analyzing customer data at these different geographic levels allows you to uncover patterns and insights specific to each specific location. Specifics like urban vs rural areas are variables to consider as well.

Different areas also have different time zones, which can significantly impact consumer behavior, content consumption, and communication preferences. This is especially crucial for large, global companies serving customers across multiple time zones.

Stay Up-to-date On All Things Marketing & Leadership.

• Your email *
• By submitting this form, you agree to receive our newsletter, and occasional emails related to The CMO. You can unsubscribe at any time. For more details, please review our Privacy Policy . We're protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
• Name This field is for validation purposes and should be left unchanged.

Population density

The population size and density of a geographic area can influence factors like infrastructure, cost of living, and access to technology—all of which can shape your customers' different needs and purchasing habits.

Cultural preferences

Regional cultures, traditions, and values can significantly impact buying behaviors, communication styles, and brand perceptions. Understanding these cultural differences is critical for developing localized marketing strategies.

Language barriers can create challenges for product adoption and customer support. Identifying the predominant languages spoken in your target markets allows you to provide content and assistance in the appropriate dialects.

Benefits Of Geographic Segmentation

Leveraging geographic data as part of your overall segmentation strategy can help you reach a lot of overarching goals. The biggest ones are these three:

• It empowers you to deliver highly localized campaign optimization. By understanding the unique characteristics of customers in different regions, you can tailor your messaging, offers, channels, and even product features to better resonate with each target audience. This level of personalization can significantly enhance the customer experience and drive higher ABM engagement .
• It opens the door to expansion into new high-potential markets. Detailed location-based insights can uncover untapped geographic segments that align with your small business goals, allowing you to strategically grow your footprint rather than relying on guesswork. Plus, with a clear understanding of your most valuable regional markets, you can more efficiently allocate resources like marketing budget, talent, and sales territories to maximize return on investment across the board.
• It provides quantifiable data points to inform a range of strategic decisions . From product development to channel optimization, this data-driven marketing approach helps ensure your initiatives are firmly grounded in a deep understanding of your target customers and their location-specific behaviors and preferences. 

Challenges Of Geographic Segmentation

While the benefits of geographic segmentation are numerous, there are also some challenges and limitations to be aware of. Here are some of the hurdles:

• Obtaining accurate, up-to-date geographic data on potential customers. Relying on third-party data sources or self-reported information from users introduces potential inaccuracies, making it difficult to create truly precise location-based profiles. Additionally, you may lack sufficient geographic data coverage, especially for niche or new markets.
• The constantly evolving geographic landscape . Factors like migration patterns, urban development, and economic shifts are continuously reshaping regional markets. Keeping your location-based insights current and relevant requires ongoing data collection and analysis, which can be resource-intensive.
• The complex web of data privacy regulations, such as the GDPR and CCPA. You have to ensure that you collect, store, and leverage customer location data in full compliance with these regulations, or you risk big penalties.
• Collaboration across teams. From marketing and sales to product and customer success, overcoming organizational silos to centralize location-based insights and coordinate localized initiatives can be a significant operational challenge. Thankfully, there are some great tools for helping marketing and sales work together .

Examples Of Geographic Segmentation

Let's take a closer look at a few real-world examples that demonstrate the impact of effective demographic segmentation, as we can learn a great deal of ABM best practices .

1. Slack targeting Australian businesses

Back in 2018, Slack, the productivity platform, launched an out-of-home campaign in Australia for the first time once they saw there was a surge in demand from Australian businesses for collaboration tools. They spent years getting to know the Australian market and acquiring geographical data that helped them launch ads in Sydney, Melbourne and Brisbane.

2. Doordash targeting local diners

DoorDash, the food delivery service, relies on geographic data and segmentation to promote specific restaurants to specific audiences and customers based on their location. Their app’s algorithm will use a customer’s current location to figure out which restaurants nearby should be featured on the feed, driving the customer to purchase due to convenience. Going further, understanding the local trends and tastes in specific markets can also help the brand get better insights on what customers currently crave.

3. Nike targeting city dwellers

Nike, the footwear company, also does geographic segmentation really well in their advertising, often addressing a specific city. In the advert above “Nothing Beats a Londoner” Nike shows the real Londoner, highlighting not only landmarks but general life in London neighborhoods. 

Tips For Gathering Geographic Data

Collecting accurate and comprehensive geographic data is essential for building effective location-based segmentation strategies. Here are some key methods you can use to capture this valuable information:

Geographic information systems

Geographic Information Systems (GIS) are powerful mapping and spatial analysis tools that can provide rich insights into the geographic distribution of your customer base. By integrating GIS software like ArcGIS or QGIS into your marketing stack, you can visualize customer locations, identify regional clustering, and even overlay demographic, psychographic, and behavioral data for deeper segmentation analysis.

GPS and location analytics

Leveraging customer location data from GPS, WiFi, and Bluetooth signals can also be a valuable source of geographic insights. Tools like Google Analytics, Facebook Ads Manager, and marketing automation software offer granular location tracking capabilities that reveal where your customers are physically accessing your products and services. This can inform everything from regional content strategies to targeting of local advertising.

Geocoding is the process of converting physical addresses into geographic coordinates (latitude and longitude). By appending geocodes to your customer records, you can more precisely pinpoint their locations and conduct advanced spatial analysis. Many third-party data providers and API services offer geocoding solutions to enrich your existing customer data.

Additional Market Segmentation Techniques

While geographic segmentation provides powerful insights, it's important to recognize that it's just one piece of the overall audience segmentation puzzle. There are several other types of market segmentation that marketers can leverage to gain a more holistic view of their target audience:

Demographic segmentation

Demographic segmentation involves dividing customers based on observable characteristics like age, gender, income, occupation, and education level. This data helps create detailed customer profiles and reveals how buying behaviors and preferences may differ across various demographic groups.

Psychographic segmentation

Psychographic segmentation goes deeper into the internal characteristics that shape a customer's attitudes, values, interests, and lifestyle. This includes personality traits, hobbies, social class, and broader cultural influences. By understanding the psychological drivers behind purchasing decisions, brands can craft messaging that resonates on an emotional level.

Behavioral segmentation 

Behavioral segmentation analyzes customer actions and usage patterns to group them based on their digital behaviors. This can include website engagement, content consumption, feature utilization, and subscription plans. Identifying these behavioral trends allows companies to personalize the user experience, optimize product roadmaps, and develop targeted cross-selling or upselling strategies.

Join For More Targeted Insights

While geographic segmentation offers numerous benefits, it also presents challenges around data accuracy, changing market landscapes, and balancing personalization with scale—which must all be thoughtfully navigated.

To quickly recap the key takeaways:

• Understanding the unique characteristics, preferences, and behaviors of customers in different regions can craft highly personalized and impactful campaigns that drive engagement and conversion.
• Geographic segmentation allows for stronger tailoring of your marketing efforts to the specific needs and dynamics of local markets, optimizing everything from your messaging to product features.
• Analyzing key geographic variables like location, time zone, population density, cultural norms, and language can provide a wealth of insights to inform your segmentation strategy.

If you're looking to take your location-based marketing to new heights, be sure to subscribe to The CMO newsletter . 

11 Marketing Campaign Types To Try (+ Examples And Tips)

19 Account-Based Marketing Software Use Cases To Inspire You

Must-Know Account-Based Marketing Trends in 2024

10 sales forecasting methods & how to pick one in 2024.

• PPC Management Services PPC perfected
• Social Media Marketing Spark conversations, grow your audience
• SEM Services Success through search
• SEO Services Race up the rankings
• Conversion Rate Optimization Don’t just drive traffic, drive conversions
• Google Ads Services Powerful platform, powerful results
• Content Marketing Services Content that converts
• Remarketing Turn curiosity into customers

By Campaign Type

• Ecommerce See your sales soar
• Lead Generation Turn leads into revenue
• Local Increase revenue: online & in-person
• Enterprise Scale and Dominate

By Industry

• Real Estate
• Cybersecurity
• Improve Conversion Rate
• Improve Quality Score
• Improve Lead Quality
• Reduce CPCs
• Lower Acquistion Costs
• Increase Sales
• Rank Higher on the SERP
• 11 Google Ads Scripts to Run
• Conversion Tracking Issues
• Scale Campaigns
• Recent Peformance Drops
• Google Ads & GA4 Not Matching
• Organic Traffic Flucuations
• Google Ads Overspending
• Losing to Competitors
• Website Architecture for SEO
• What's a Good ROAS
• What's a Good Conversion Rate
• PMax Campaigns: Full Guide
• Create PPC Analytics Reports
• Build Topic Clusters for SEO
• How to Best Split Your Budget
• How to do a Website Migration
• Do SKAGs Really Work?
• Content Marketing
• Social Media
• Best Audit Tools to Use
• Ecommerce Brand Drives 50% Higher AOV
• SaaS Brand Doubles Demo Requests
• University Achieves Enrollment Goals
• Social Media Drives a 60% Revenue Increase
• PPC Management
• SEO Marketing
• Google Ads Management
• Ecommerce Marketing
• Saas Marketing
• PPC Pricing: How Much Should You Pay?
• SEO Pricing: How Much Does SEO Cost?
• How to Optimize Google Ads
• Google SGE: Full Guide
• What is an SEO Consultant?
• Meet the Team
• Free Consultation

What is Geographic Segmentation? How to Use It + 7 Examples that Work

Sarah Jane Burt

Caroline Cox

Senior Editor

Approved By

Patience Hurlburt-Lawton

Content Manager

Geographic segmentation creates more effective, personalized marketing campaigns by using location-based targeting. Learn from real-life examples and keep these expert tips in mind.

When you think of customer segmentation, you might think about demographic, behavioral, or psychographic segmentation. But if you’re not considering geographic segmentation, you’re missing an opportunity to understand, reach, and convert your target audience.

Geographic segmentation isn’t just for location-based businesses, international brands, or companies selling weather or climate-related products.

Nearly every brand can use it to learn something about its buyers and create a more targeted marketing strategy.

Let’s dive into what geographic segmentation is, what geographic variables you can use to segment your audience, and what it looks like in real-life campaigns.

Geographic segmentation definition

Geographic segmentation organizes your audience into different groups using geographic variables. This type of segmentation helps you identify and leverage location-based characteristics to create more personalized marketing campaigns.

Where a buyer lives impacts their choices and habits. After identifying the patterns and trends based on geographic segments, you’ll better understand fluctuations in demand and the best ways to market your offers.

So whether you’re running PPC lead generation ads or buying billboard space, you can use the data to inform your strategy.

For example, people in larger urban areas may be more likely to buy a certain luxury product than their suburban and rural counterparts. Identify this, and you can create more targeted marketing campaigns to reach the right buyers.

“Geographic segmentation is a fundamental strategy in PPC marketing that could yield high ROI if utilized properly,” says Sam Yedagar, HawkSEM CEO. “You want to ensure you’re working with a PPC agency or PPC manager that understands your target audience and how to best utilize geo-segmentation to get the highest ROAS.”

By using geo-segmentation along with other PPC strategies, HawkSEM was able to increase CDL Consultant’s conversion rate by 124% and their qualified call conversion rates by 108%. See how the team did it .

Benefits of geographic segmentation

There are several types of market segmentation — why consider geographic location to segment your customer base?

While demographic, psychographic, and behavioral segmentation are all helpful, geographic segmentation is the only type that considers geography’s influences on behavior, preferences, trends, and buying decisions.

Here are several benefits of geographic segmentation:

• Target more efficiently. Geographic segmentation helps you learn more about your customers and target audience. With this information, you can better identify buying patterns and behaviors.
• Optimize your marketing budget. Instead of marketing to people who may not have an interest or need for your products and services, you can use geographic segments to ensure you reach the right people.
• Save money. When you market to everyone, you waste money on those who aren’t the right fit for your product. Geographic segmentation saves money using highly-targeted campaigns.
• Get started easily. If you’re just starting your segmentation strategy, geographic segmentation is fairly easy. The information is concrete and easier to find, making analysis straightforward.
• Provide better customer experiences. The more customer information you have, the more personalized you can make your marketing campaigns and messaging, resulting in a better experience.

Geographic targeting alone may not give you the whole picture. So, it’s valuable to overlap different types of targeting as part of your marketing or ad strategy.

For example, let’s say you’re running a retargeting ad campaign. You combine both geographic and demographic segmentation to reach the population of 25- to 30-year-old women in urban areas.

To get the full benefits of geographic segmentation, track your campaign performance. HawkSEM uses ConversionIQ to track the results from campaigns with specific geo-segmentation.

“Tracking the performance of these campaigns not only allows you to see what part of the marketing dollar is providing a positive return,” explains Yadegar. “But with ConversionIQ, we can extract specific customer data (from traffic that converted) and use that data to market to more potential customers who are also highly likely to convert.

7 geographic segmentation variables

Geographic segmentation isn’t just about grouping people together by their home address. There are other characteristics that align with a person’s geographic location that help you understand and target their different needs.

Here are the seven geographic segmentation variables you may use in your PPC ad campaigns:

• Climate & weather
• Ethnicity & religion
• Population density

1. Location

Location is probably the first thing that comes to mind when you think of geographic segmentation. This involves grouping customers and prospects into segments based on where they live.

Location-based segmentation can be as broad as people living on a certain continent and as specific as those with a specific postal code.

If you’re launching a campaign targeting different countries, you may use this as a segmentation option. Laws, regulations, languages, preferences, and more can vary from country to country, and you may need to account for that in your offers, strategy, and marketing messages.

If your target market lives in different regions of the world, account for that in your segmentation. For example, Europe’s culture is different from U.S. culture. And even within the U.S., West Coast folks have different behaviors, tendencies, and preferences than those on the East Coast.

If you have a small business operating across the United States, consider segmenting based on state if it’s relevant. For example, insurance laws are different in California than in Florida, so the plans you advertise in each state may differ.

2. Climate & weather

Climate and weather impact different markets’ demand for certain products. When you segment by climate, you can target those who live in colder areas with different products than those who live in warmer climates. People in Canada may want to purchase hand warmers, but people in Mexico may be more interested in sandals.

Similarly, if an area is prone to snow, extreme heat, rain, hurricanes, or humidity, you can segment these different areas. People in Florida (one of the rainiest states) may have more chances to use a rainy-day discount promotion than people in Nevada (one of the driest states).

Cultural preferences and attitudes vary from place to place. Studying the local culture of different geographic areas reveals what customers want and need.

When you respect cultural differences and adjust your PPC ad copy and offers to account for this, you can build genuine, long-lasting relationships with buyers.

You may not connect “fast food” with culture, but McDonald’s is a great example of a brand that takes cultural preferences into consideration. Not just in its messaging but in its offers — for example, its menu offers lobster rolls in New England, spam in Hawaii, and taro pies in China.

4. Ethnicity & religion

Ethnicity and religion are significant — from the holidays we celebrate and the food we eat to our daily habits and customs. This is another way to segment your audience for more effective marketing campaigns.

When you understand your customers’ ethnic and religious backgrounds, you can avoid sensitivities when targeting promotions to their customs and holidays. For example, a dress retailer may market dresses for quinceñas to areas with high Mexican populations and dresses for bat mitzvahs to high Jewish population areas.

5. Population density

Population density impacts the number of potential buyers in the area and their buying decisions and preferences . Buyers in rural areas will need and want different offers than those in urban or suburban areas because their lifestyles and attitudes differ.

Here are several examples.

Urban areas have a higher population density than rural areas, providing a larger market to tap into with more competition. These areas tend to be more diverse and attract a more politically progressive population.

Urban residents are more likely to have access to public transportation and ridesharing. Since things are generally closer together, they’re also closer to government resources like the library, courthouse, and post office. They have more options for entertainment and shopping than those in rural areas.

People living in urban areas tend to make more and have more disposable income, but they also have a higher cost of living. They pay more for housing and often live in smaller homes than those in rural areas. They also tend to spend more on food overall because they have more options for dining out.

Rural areas have a less dense population. They have fewer options to pick from locally, so there is less competition. People living in rural areas may also be less sensitive to trends than their urban counterparts.

Those living in the country spend less than urban or suburban residents. They have fewer dining options but are able to grow their own food. They are dependent on their vehicles to get around and value privacy.

Rural residents tend to spend more time outdoors. They have easy access to natural areas, making outdoor activities like hiking, fishing, hunting, and boating more common.

Suburban populations are unique — many suburban residents work in the city but live in the suburbs for affordable housing. So they may have very similar characteristics to those in urban areas, though their lifestyles are different.

The suburbs tend to be more car-dependent than cities — but not as much as rural areas. Many suburbs have access to mass transit but are less walkable than urban areas.

Suburban areas tend to have the best schools, making them attractive to families. These areas also offer the best of both worlds for indoor and outdoor activities since they’re close to cities and a short drive away from rural spots.

6. Language

Using the language of your target market is essential to your marketing efforts. If you have an international audience, use geographic segmentation to group people by their language.

Whether your audience speaks English, Spanish, German, or Chinese, segment each to ensure you serve ads to the right buyers in their native language.

7. Time zone

Time zones impact the timing of mass marketing communications like email or SMS. Segmenting customers based on time zone allows companies to send marketing messages at the most optimal time for customers in that area.

Geographic segmentation played an impactful role in the HawkSEM team’s PPC and SEO strategy for Escape the Room. See how HawkSEM helped them get record clicks and impressions.

Geographic segmentation examples in real life

The best way to understand the power of segmentation is to see it in action. Here are real-life examples of geographic segmentation in popular marketing campaigns:

Geographic segmentation by location

Geographic segmentation by climate, geographic segmentation by culture, geographic segmentation by ethnicity & religion, geographic segmentation by population density, geographic segmentation by language, geographic segmentation by time-zone.

As an international brand, Nike often uses location to tailor its messaging and content. The sports apparel company promotes different sports gear and clothing based on the popular sports in each location. Nike’s ads promote gear for basketball and baseball in the U.S., soccer in Europe, cricket in India, and rugby in England and Sydney.

Nike also features locally popular athletes in its ads to attract customers in different areas. For example, soccer (or football) ads in the U.K. feature prominent athletes that people in the area would recognize. For instance, Nike features Demi Stokes, a professional English footballer playing for Manchester City and the England national team, in its UK advertisements.

Here, Nike projected an ad featuring the soccer star on a well-known England landmark, the Thames barrier:

Source: soccerbible.com

Then ads in the U.S. feature popular soccer players United States fans recognize like Alex Morgan, captain of San Diego Wave FC of the National Women’s Soccer League.

Source: footwearnews.com

Companies in the hair and beauty industry often use climate as a factor for segmentation. People in different regions have different preferences and face different challenges based on climate. So ads targeting these people need to feature different products or types of messaging to appeal to the audience.

Kate Ross, Hair and Beauty Specialist at Irresistible Me uses geographic segmentation in the company’s marketing campaign for the Diamond Flat Iron.

“We found that customers in the Southwest region were more likely to have dry and frizzy hair due to the hot and arid weather, and they valued moisturizing and smoothing features in their flat irons,” explains Ross. “On the other hand, customers in the Northeast region were more likely to have fine and straight hair due to the cold and humid weather, and they valued volumizing and curling features in their flat irons.”

Source: irresistibleme.com

When Irresistible Me launched this product in the U.S. market, its in-house Ads Marketing Specialist Stefan Valentin, used these insights to tailor its marketing messages and offers to highlight product benefits that appeal to each geographic segment.

“In our ad copy, we emphasized how the flat iron’s tourmaline-infused ceramic plates could lock in moisture and reduce frizz for customers in the Southwest,” says Ross. “And we emphasized how the flat iron’s adjustable temperature settings could create different styles and curls for customers in the Northeast.”

Coca-Cola’s “Share a Coke” campaign is a great example of using cultural segmentation to not only personalize advertising but also the products themselves. This multi-national 2014 campaign was successful because of its community focus, a universal theme that appeals to every culture.

Coke used its packaging to personalize bottles and cans, using different names in different regions, catering to the cultural diversity of each area. Here’s just one example of a promotional image from its United States campaign:

Source: independent.co.uk

These are popular American names that are likely to appeal to a large number of Americans who have or know someone with these names.

The campaign used different culturally significant names in different countries. For instance, in Ireland, the company featured the traditional Irish names Róisín, Tadhg, and Liam, on bottles.

Source: medium.com

SwagMagic allows organizations to create their own branded gift items. It also uses culture as a geographic segmentation variable in how it connects with customers through its messaging.

“Employee gifting is a powerful motivator in the United States. And personalization, convenience, and brand recognition are highly valued,” says Jas Banwait Gill, Growth Manager at SwagMagic. “We’ll share success stories of companies that use our platform to create memorable corporate gifts and how it strengthened their business partnerships. And we’ll ramp up our promotions during the lead-up to the holiday season and Employee Appreciation Day.”

The company highlights other benefits and themes when marketing in other countries. For example, in India, gift culture is different. Gifting is often tied to celebrations, festivals, and personal relationships.

“So we leverage the emotional connection of gift-giving with messages highlighting the joy of giving and receiving gifts,” Gill continues. “Since India is a vast and diverse market, we adapt our messaging to local languages, nuances, and customs.”

McDonald’s is a great example of a global brand that does its market research and tailors products and ads to each location. It’s known for having different versions of its menu that include regional favorites. But in India, religion plays a role in its product offerings.

Known for its hamburgers, McDonald’s has re-engineered its menu and advertising in India, a country whose most widely practiced religions have dietary laws and traditions. Hindus avoid eating beef because cows are seen as sacred in their religion. And it’s even illegal to slaughter cattle in many areas of India. While Muslim teachings prohibit the consumption of pork.

Instead of McDonald’s beloved Big Mac sandwich, you will find the Chicken Maharaja Mac, a double-layered grilled chicken sandwich. While a big sandwich seems to fit right in with American meal expectations, the same is not true for India.

For this reason, ads for the sandwich feature the tagline “the social burger,” marketing the sandwich as something you eat while spending time with others. Yes, it’s a big sandwich, but it’s meant to be eaten as you socialize with friends and family.

Source: quoracdn.net

Given that in India, 81% of adults restrict meat from their diet, McDonald’s has also incorporated many vegetarian menu items to align with this cultural norm. Its Indian menu features items like the McAllo, featuring a patty made from potato and peas with vegetarian sauce, and the McSpicy Paneer, a patty made from Indian cheese.

Population density has a big impact on housing. Homes in cities tend to be smaller, with many more people living in apartments than houses. Due to the cost of living, average home prices, and availability of homes to purchase, there are more people renting apartments and homes in cities than in suburban and rural areas.

Home improvement stores like Home Depot and Lowe’s use population density as a variable in the products they advertise to people in different areas. City dwellers and country residents have unique needs impacting their home improvement and maintenance projects.

For instance, let’s say Home Depot wants to run a promotion on lawnmowers. Rural properties may have acres of land, while suburban homes have a smaller yard, and urban homes may have little to no yard at all. This impacts the type of lawnmower a person may need.

In more population-dense areas, Home Depot may highlight manual push mowers, which get the job done for smaller lawns. They’re also compact, making them ideal for people who don’t have much space.

In rural areas, it may promote riding lawnmowers. This mower is more practical and efficient for people living on larger properties. They’re also more likely to have a place to store the large equipment.

In suburban areas, it may advertise its gas push mowers, which are a better fit for smaller yards. While they aren’t as compact as the manual push mowers, they’ll fit in a small shed or garage, which is more common in suburban areas than urban areas.

If you want your paid search ads to be effective, they need to speak to people in the the language they understand best. This may vary from country to country or by region.

For example, in most areas of Canada, advertising in English will be the norm. However, in Quëbec, French is the official language. In fact, in June 2022, the province passed Bill 96 , a controversial law that limits the use of English in certain settings, making French the language of business in Quëbec.

Any advertisers in this area of Canada will need to create ads in French if they want to appeal to the target market and adhere to the law. Though the law allows English to be used alongside French in some advertisements, that’s only if French is the “more predominant language” (meaning it’s at least twice as big as the English text).

Here’s an example of an Ikea billboard ad in Quëbec:

Source: langsolinc.com

Not only is the ad copy in French, but the link it drives people to is a link to the French language Canadian website.

Larger businesses operating in countries across time zones will use this as a segmentation variable to plan promotions and ad campaigns. Time zone segmentation is useful for email marketing campaigns as it allows you to schedule emails to hit customers’ inboxes when they’re most likely to open and read them.

This segmentation tactic is also important for PPC ad scheduling. For example, if you want to run ads in both New York, NY, and Sydney, Australia, you won’t schedule them for the same time. The AEDT time zone is 15 hours ahead of New York City.

So, while your data may tell you 5 p.m. ET on a Friday is an optimal time to run ads, it’s 8 a.m. Saturday morning in Australia which may not be an optimal time for that population.

The takeaway

Using geographic segmentation for your marketing and PPC ad campaigns can help you deliver more targeted messaging and offers to your audience—wherever they may be.

It’s certainly not the only type of segmentation you should pay attention to, but it can make a significant impact on your advertising results.

Ready to get support with your PPC ads? Book a free consultation with the HawkSEM team today.

Privacy Overview

• Customer Generation
• Become a Partner

Become unforgettable

• Success Stories
• Book Intro Call

Geographic Segmentation

Geographic segmentation: definition and examples, what is geographic segmentation, geographic segmentation vs demographic segmentation - what's the difference, how does geographic segmentation work, directive consulting uses geographic segmentation to drive marketing roi.

Market Segmentation is a method used by marketers to divide a target market into smaller groups based on common characteristics, in hopes of marketing more effectively to each group. Marketers know that individual consumers have wants and needs that are linked to their demographic and psychographic characteristics, past interactions with a company or brand, and the place where they live. Marketing segmentation tries to identify groups of people with similar wants and needs so that marketers can produce targeted messages that appeal to them.

Geographic segmentation is a type of market segmentation that groups prospective customers based on where they live. People living in the same environment tend to have similar wants and needs, and geographic segmentation allows marketers to target audiences in a country, city or region with messaging that appeals to their specific wants and needs.

Why is Geographic Segmentation Important?

Effective geographic segmentation is a crucial component of any marketing campaign. It ensures that marketing dollars are appropriately spent on targeting prospective customers with the most relevant message that appeals to their needs and is most likely to trigger purchasing behaviors. Without geographic segmentation, consumers would frequently encounter advertisements for products and services that are unavailable where they live.

Let’s consider two examples: a local pizza restaurant and a Fortune 500 software company.

A small restaurant may have a limited marketing budget, making it vitally important to get the most value for every dollar of marketing spend. To achieve this, marketing efforts must be highly targeted toward customers in the restaurant’s delivery area. If a restaurant in Denver is paying to advertise to consumers in Aspen, that money is wasted, because nobody is driving six hours to get a pizza. Effective geographic segmentation can help this restaurant identify and market to potential customers in the target region.

A Fortune 500 software company will have a bigger marketing budget, but effective geographic segmentation will be crucial in maximizing return on investment. International organizations face the challenge of marketing to companies and individuals in different countries around the world with different wants and needs, different languages and ways of communicating, different business cultures, different values, and preferences, etc. An advertisement that works well in America may not work at all in Europe or Asia. With geographic segmentation, this company could divide its target market by country and produce targeted advertisements to appeal to prospective customers in each nation.

Geographic segmentation is not the only type of marketing segmentation – in fact, there are three other types that are commonly applied to help identify groups of customers with common characteristics: demographic, psychographic and behavioral segmentation .

Demographic segmentation divides a target market into different groups based on statistical data. This data can include things like age, gender, family situation, location, income, education level, ethnicity, and other factors. Companies can access demographic information about consumers through different sources, including through the United States Census Bureau, the Small Business Administration Office of Entrepreneurship, through market research websites, or from companies that do public polling.

Psychographic segmentation tries to divide a target market into categories based on psychological characteristics such as traits, values, motivations, beliefs, interests, and lifestyles. This data is not readily available, so organizations may have to conduct in-depth research into their customers to identify and accurately understand psychographic segments.

In B2B sales , target prospects may have different psychological influences and motivations depending on their roles and responsibilities. A sales manager might be motivated to maximize revenue, while a COO is motivated to maximize operational efficiency and a CFO wants to achieve great financial results. Dividing customer segments by their shared needs and values is psychographic segmentation.

Behavioral segmentation is the practice of grouping target prospects according to their past interactions with the marketing organization. This common practice requires marketing organizations to effectively track interactions between individual prospects and the brand across multiple marketing touchpoints. Marketers may group consumers according to their brand interactions, behavior on a website, purchasing patterns, or spending habits.

Geographic segmentation is all about grouping target consumers based on their shared geographical characteristics. The core assumption of geographic segmentation is that a consumer’s needs and wants can vary based on their location, and that grouping people by location can help marketers deliver more relevant content that addresses the needs of consumers in a specific place. There are several geographical parameters that can be used to identify and delineate customer segments in order to deliver more targeted advertisements.

Some companies only do business in one country and need to concentrate their marketing efforts there. Other companies are international and may develop strategies to market to consumers in different countries or to enter a new international market.

A company may go to preferentially target people that live in a specific city. Cities have greater population density than suburban or rural areas, enabling companies that sell physical products to distribute to more people for a lower cost by targeting cities. Marketing preferentially to cities is effective for firms whose distribution infrastructure is concentrated in urban centers.

Urban/Suburban/Rural

Some companies may choose to market their products differently to customers living in urban, suburban and rural environments. This reflects the reality that our environments affect how we perceive and interact with certain products and services.

A car company might market to urban populations by highlighting safety features like lane change alerts and back-up cameras that help avoid collisions when there are many other vehicles around. For suburban populations, the same company might emphasize fuel economy and spaciousness (room for family), knowing that this target market will use the car for commuting to work each day and bringing the kids to soccer practice. For rural customers, marketing messages might focus on comfort and durability.

Climate & Weather

Some companies sell seasonal products like winter tires, but it makes no sense to advertise winter tires in California. Geographic segmentation helps companies that sell seasonal products access the right audience at the right time where the product is needed.

Geographic segmentation is one of the best ways of sending more targeted marketing messages to your prospective customers that help improve conversions and drive revenue. Geographic segmentation is also easier and cheaper to do than demographic, psychographic or behavioral segmentation while offering many of the same benefits.

For businesses that operate in a defined target area, geographic segmentation helps ensure that marketing funds are appropriately spent on reaching local prospects. For larger companies, geographic segmentation helps ensure that prospective consumers across the world receive targeted and relevant marketing content that is more likely to lead to purchasing behaviors.

We apply our  Customer Generation methodology to optimize marketing spend and target the most profitable marketing channels, ensuring that our customers achieve revenue targets while increasing marketing efficiency, every time. To learn how we can increase the efficiency of your next marketing campaign with geographic segmentation, book a call with our expert team of tech marketers to get a custom proposal.

• Inbound Marketing , Insights , Perspectives
• Inbound Marketing , Strategy

Whether you need done-for-you marketing or expert DIY guidance, Directive has you covered.

• Case Studies
• Directive Digest Newsletter
• Marketing Operations
• Marketing Strategy
• [email protected]
• (949) 214-4024

Orange County

New york city, mexico city.

• Privacy Policy
• Cookies Settings

Actionable tips, community conversations, and marketing inspiration.

The Ultimate Guide to Geographic Segmentation

Laura Barker

Topics covered:.

• Digital Advertising
• Personalization

We all know that targeting the right people is at the core of a successful marketing campaign. But to precisely target that group of ideal people, marketers first need to focus on segmentation, or breaking a large group of people into smaller sub-groups. 

There are several ways to segment an audience — and geographic segmentation is where many marketers choose to start. Let’s explore the concept of geographic segmentation and how you can use a geo-segmentation strategy to win more customers.  

What is Geographic Segmentation?

Geographic segmentation is the practice of grouping members of an audience based on location, including where they live, work, and shop. These groupings can be as broad or narrow as necessary, from country to postal code or even more specific. 

The basis of geographic segmentation is simple: Consumers’ shopping habits are influenced by where they live. For example, people who live on the coasts might purchase seafood more often than people who live in the Midwest, and people who live in urban areas might be more likely to buy a compact car rather than a pickup truck.

This type of segmentation helps businesses understand shopping trends and behavior in different areas of the world, which then helps them improve audience targeting and increase marketing effectiveness. 

There are a number of variables that should be considered when breaking your market into geographic segments. We’ll dive into those factors in the next section.

Types of Geographic Segmentation

Location-based segmentation.

The simplest and most common way to geographically segment an audience is by location. People who live in close proximity to certain brands are more likely to purchase from those brands, rather than from a competitor that’s farther away. Additionally, some products may not be useful to people in certain areas, so advertisers can exclude those populations from their marketing campaigns. 

Example: A restaurant uses Google Search ads to target people within a 2-mile radius of its physical location. When those people Google “restaurants near me,” an ad for the restaurant appears at the top of their search results.

Culture-based segmentation

Cultural variations and preferences can dictate how your brand or products will be perceived in different parts of the world. By being aware of a region’s unique customs and traditions, marketers can decide not only whether it’s effective, but if it’s acceptable to run promotions in certain areas. 

Example: A fast food chain adjusts their menu offerings in different parts of the world. In India, where most people practice Hinduism, the chain does not serve hamburgers or other beef products.  

Time-zone segmentation

Many businesses have customers living in different time zones, which can make it difficult to correctly time mass marketing communications. Marketers can segment customers based on time zones to ensure emails, social media posts, and other initiatives are published at the optimal time.

Example: A clothing company is running a one-day sale on jeans, and they want to promote the sale in an email to customers. If the company doesn’t segment its email list by time zone, customers in Chicago will receive the email at 9 a.m. while customers in Sydney will receive it at midnight — a time when they’re probably asleep and will miss the email.

Population-based segmentation

Population density is another particularly important variable to consider when creating geographic market segments. Rural populations have very different needs than urban populations, and the demand for certain goods is often higher in densely populated areas. 

Example: A lawn service company targets a small number of people — homeowners living in the suburbs —with Facebook ads rather than a large group of city dwellers.

Climatic and seasonal segmentation

Weather and climate dictate market demand for certain products across many industries. Consumer needs and preferences change based on how warm, cold, wet, or dry an area is at any given time.

Example: A sporting goods store targets people living in California with ads for surfing accessories and apparel, and people planning a ski vacation with goggles and gloves.

Benefits of Geographic Segmentation

Ideally, brands should use a variety of segmentation strategies — including demographic, psychographic , and behavioral segmentation — to define their audience and improve targeting. Each type has unique benefits that contribute to better marketing performance and ultimately, more ROI. So why include geographic segmentation in the mix?

More personalization . You can tailor the message each segment receives based on their unique needs and preferences. More relevant ads lead to more purchases.

Save budget and resources. Instead of wasting money on mass audiences who may have no interest in your brand, targeting geographic segments ensures your ads reach the right people.

Target more efficiently. Large groups of people are often very different from each other. When you turn a big population into smaller groups, you can more efficiently and effectively market to each segment. 

It’s easy. Pinpointing and analyzing geographic variables is a relatively straightforward process. And with the right tools , targeting your audience based on geographic segments is a breeze.

Deeper understanding of customers. When you market to segments, you start to learn more about what people in a particular area want and what drives their behavior. These insights can inform future marketing strategies and more effective campaigns.

Implementing a Geographic Segmentation Strategy

Whether you’re a small business new to geographic segmentation or an advanced marketer looking to get more out of your current segmentation strategy, the right technology is key. AdRoll Unified Contacts and dynamic list builder power hyper-personalized marketing across ads and email for both identified and anonymous contacts. Achieve better communication with shoppers and more sales across channels — from a single platform. 

Learn more about our audience and segmentation tools today.

Have more questions about audience segmentation and targeting? Check out our resources below! 

Frequently Asked Questions

What are examples of geographic segmentation in marketing.

Geographic segmentation examples in marketing include:

Promoting dog walking services in a densely populated, urban area

Targeting people who live in New England with cold-weather apparel ads

A bakery advertising to people who live within 5 miles

What are the 5 main geographic segments?

The main geographic variables that should be considered when segmenting an audience are location, climate, population, culture/religion, and time zone.

What does geographic segment mean in marketing?

Geographic segmentation is the practice of grouping members of an audience based on location, including where they live, work, and shop. Using these segments, marketers can draw valuable insights about consumer trends and behaviors across different areas. This allows for better targeting and more effective marketing. 

Last updated on December 1st, 2023.

Explore Next

A beginner’s guide to advanced segmentation.

Still blasting the same message to every shopper under the ☀️? There’s a better way to market your products and brand — and it starts with advanced segmentation.

What Is Behavioral Segmentation and How Do You Use It?

Here's a beginner's guide to behavioral segmentation and how you can use it to increase your sales.

The Sorting Hat of Marketing: Psychographic Segmentation

Customer details like age and location aren’t enough. Use the magic of psychographic segmentation to understand your customers.

Discover Even More

How to get started with social media ads in 2024, the abandoned cart recovery guide, the beginner’s guide to retargeting [ebook + worksheet].

Geographic Segmentation: The Complete Guide

Updated: July 18, 2024

Published: March 09, 2023

Geographic segmentation organizes your audience into groups based on their physical location, such as country or postal code.

This type of segmentation can provide valuable insights into the buying trends and preferences of different regions, allowing for more targeted and effective marketing efforts.

Plus, geographic segmentation can increase profits and sustain growth.

By understanding the needs and behaviors of different regions, businesses can create more effective marketing campaigns and build stronger relationships with their customers.

Learn more about geographic segmentation below.

Table of Contents

What is geographic segmentation?

Benefits of geographic segmentation, advantages of geographic segmentation, geographic variables.

• Geographic Segmentation Example

Like other types of segmentation, geographic segmentation organizes your audience into different groups. The groups are based on physical location, like a specific country or postal code.

Well, people in certain areas follow certain trends. For example, the residents of a particular city might buy much more fresh fruit than a neighboring city.

Geographic segmentation can help you figure out those trends so you can focus your marketing efforts in the right places.

Segmentation doesn't just bolster your marketing — it's more necessary than ever these days. Other than dividing your audience by location, why should you care about geographic segmentation?

Geographic segmentation can save you money. Think about it: You can spend endless amounts trying to promote your offers.

With the right segmentation, you're marketing the right offers to the right people — people who want and need what you're selling.

Effective geographic segmentation can also make and keep your business relevant.

If you market to the right segments, people will keep buying your products or services. If they keep buying, they're more likely to recommend your business to others.

You can also use geographic segmentation to innovate your product. For example, a certain flavor or style may be prevalent in a certain area. If you make a version of your product with this specification, you can increase sales.

Finally, geographic segmentation can be easier than other types of segmentation . Since the information is concrete, measurement and analysis are much more straightforward.

Your budget dictates your marketing strategy, for better or worse. So, with a specific budget, how can you make sure your marketing results in sales?

Well, geographic segmentation is a great choice — especially compared to something like psychographic segmentation.

Here are a few reasons geographic segmentation might end up on your to-do list.

Image source

1. You can accelerate growth.

More sales are great, but sustained growth is even better. Geographic segmentation can help with both.

Update your segments regularly, and you should be able to keep targeting the right groups. Keep that up, and your business is almost guaranteed to keep growing.

2. You can organize your marketing efforts.

Scalability is one of geographic segmentation's greatest strengths. While you can zoom out and create large segments, you can also zoom in and target more specific groups.

You can even target based on keywords that can help you select a particular group without spending a fortune on marketing.

3. You can improve communication.

As you probably know, every group — and every customer, for that matter — has unique needs and habits. That's where geographic segmentation comes in.

With the right segments, you can focus more on how specific groups of people communicate and do business. That's invaluable if you want to do business with them.

4. You can boost profits.

Want your business to make more money? Start targeting your audience with geographic segmentation, then create specific marketing campaigns for each group.

If you do this right, you should be able to make more profit and cut down on your time and money spent.

The world is a big place. That can make geographic segmentation seem intimidating, but it doesn't have to be.

See, all the geographic variables let you create segments based on the information you can get. Let's look at a few of these variables and how you can use them.

This is probably what comes to mind when most people hear "geographic segmentation." You can segment on a local level all the way to a global level, depending on your needs.

Small Area (Neighborhood)

Think about the last few times you Googled something. Remember the top few results on the first page? Chances are some of those ads were locally relevant to you.

You can target specific communities and areas with your marketing in the same way.

Large Area (Continent)

Have you heard of Cadbury Eggs? They're chocolate eggs that contain toys inside. Eggs with toys inside are banned in the U.S. So it wouldn't make much sense to see a Cadbury Egg commercial in the states.

Without proper geographic segmentation, those ads might run in the wrong market, which would be a waste of money and time.

Segmenting based on climate has to do with weather conditions. Think about it: Packing the same clothes for Hawaii and Montana wouldn't make sense.

People have specific needs and wants depending on their climate, so always be aware of the weather in any market.

Warm Climates

Let's say you sell sunscreen for this example. You probably wouldn't send most of your stock to Iceland, but mistakes happen. Instead, you'd have the most success selling sunscreen somewhere like California or anywhere else with beaches.

Segmenting based on climate can help you match the right products to the proper weather.

Cold Climates

Imagine you went on a ski trip and forgot to bring a nice shirt to wear to dinner. What would you think if you went to a shop in the ski lodge and only saw short-sleeved shirts?

Well, with the right segmentation, the shop would likely have cold-weather clothing. That's why geographic segmentation is important, even regarding weather.

Population Density

Let's say you found the perfect way to segment your audience, and you want to hone in on a certain group. Now, what if this group, the one you thought would buy everything you had, bought at a low rate?

That might have to do with the population's density. Here's how population density can affect your operation.

Think about how the average person lives in an urban environment. They buy things more frequently, tend to have more money, and often care more about what's "cool."

An urban environment dictates many behaviors and habits, so make sure your offer fits the lifestyle of your target audience.

A rural environment probably isn't the best place to debut a new sports car or open a luxury fashion store.

You'll need to adjust your offerings accordingly. Keep this in mind as you segment, and don't push offers that might make a specific audience think you're out of touch.

Pure geographic segmentation can tell you a lot, but it can't account for everything. Different cultures have different products and preferences.

To assess how your offering will be perceived by different cultures, you'll need to get in touch with a diverse group of users.

Consider holding a focus group or sending a survey to your cross-cultural users. This allows you to gain insight from insiders.

Alcohol consumption is banned in Saudi Arabia. That's not to say nobody drinks, but an alcohol band won't have a place in the market there. So, if you own a distillery, you'll see a greater ROI by focusing your operation elsewhere.

Cultural segmentation can make this easier to see, as other places might have similar standards and laws based on demographics.

Let's go to French Canada for this example, specifically Quebec. There, you'll find a large population of French-speaking Canadians.

Proper geographic segmentation could help you decide if you should translate your product labels to French before selling there.

Geographic Segmentation Example: Haribo Gummy Bears

Geographic segmentation sounds simple, and it can be. But if you really want to get your message in front of the right people, you might have to dig a little deeper to create your segments.

Haribo is one of the biggest candy brands in the world. Based in Germany, Haribo produces most of its candy in the U.K. — but not all of it. Being an international brand, Haribo has to cater to many specific groups with different needs.

One of those groups is the population of Turkey, which is majority Muslim. That population requires food to be halal, including candy. This means no pork is allowed, and Haribo typically uses pork gelatin in its products.

So what does Haribo do? It produces candies with beef gelatin specifically for the majority-Muslim country of Turkey.

Why The Campaign Works

Changing ingredients allows Haribo to tap a huge population in a new geography. Dutiful market research unlocked a segment that has needs separate from their other consumers.

Without adjusting its product, Haribo would risk not only losing out on sales but also being seen as a company that lacks knowledge about its customers.

Geographic Segmentation and Your Business

Geographic segmentation is a crucial aspect of effective marketing.

By focusing on regional trends, you can tailor your campaigns to specific groups and increase the likelihood of reaching potential customers.

Using variables such as location, climate, and population density can give you a deeper understanding of your audience, leading to improved communication and increased profits.

Keep in mind that geographic segmentation can be a straightforward and cost-effective approach compared to other types of segmentation.

By regularly updating your segments, you can ensure sustained growth and scalability for your business.

Don't forget to share this post!

Related articles.

Can AI Segment Your Customers? I Ran This Experiment to Find Out

Customer Segmentation: How to Segment Users & Clients Effectively

Share of Wallet: What It Is and How to Calculate It

What Is a Customer Profitability Analysis? How to Make Your Business More Efficient

What Is Customer Communication Management? (Plus 5 Tools to Adopt)

8 Companies Mastering Customer Segmentation [+ Examples]

The Complete Guide to Customer Micro-Segmentation

8 Customer Characteristics Every Service Rep Should Know

The Expert's Guide to Contextual Inquiry Interviews

Outline your company's customer journey and experience with these 7 free customer journey map templates.

Service Hub provides everything you need to delight and retain customers while supporting the success of your whole front office

• Skip to main content
• Skip to primary sidebar
• Skip to footer
• QuestionPro

• Solutions Industries Gaming Automotive Sports and events Education Government Travel & Hospitality Financial Services Healthcare Cannabis Technology Use Case AskWhy Communities Audience Contactless surveys Mobile LivePolls Member Experience GDPR Positive People Science 360 Feedback Surveys
• Resources Blog eBooks Survey Templates Case Studies Training Help center

Home Market Research

Geographic Segmentation: Definition, Characteristics & Examples

Many tools can help you figure out what your target group does, what they need, and what they like. Geographic segmentation is an important tool that helps businesses make goods that consumers and potential customers will like. 

Before launching new products or services or improving existing ones, businesses need to do geographic segmentation as part of their market research. 

In this blog, we’ll talk about what geographic segmentation is and how you can use a number of factors to divide your market into geographic groups.

Content Index

What is geographic segmentation?

Geographic segmentation characteristics, why use geographic segmentation, geographic segmentation examples, geographic segmentation variables, advantages of geographic segmentation.

Geographic segmentation is a component that competently complements a marketing strategy to target products or services on the basis of where their consumers reside. Division in terms of countries, states, regions, cities, colleges, or Areas is done to understand the audience and market a product/service accordingly.

Geographic segmentation is putting your people into different groups or categories based on where they live. In this type of market segmentation, customers are put into groups based on factors like temperature, population, food habits, clothing, etc., as well as where they live.

Customers’ choices and habits are often affected by where they live. For example, people are more likely to buy tea and coffee in the winter because of the weather. During the summer, more people would be drinking cold drinks.

With geographic segmentation, you can figure out how trends and patterns, like the one in the situation above, affect the demand for your product or service in the market. Also, geographic segmentation gives you useful information that can help you make better marketing plans and put your business in the right place.

LEARN ABOUT: Marketing Insight

People in different parts of the world display different characteristics. A marketing strategy created by dividing the target market segmentation into segments on the basis of factors such as economics, food habits, clothing habits, languages, traditions, and many other traits is known as geographic segmentation.

A classic geographic segmentation example: A classic example – people living on colder continents, such as Europe, are interested in warm clothing, heating devices, etc., almost throughout the year, whereas people living in hotter continents, such as Australia, are interested in air conditions, beach vacations, breezy outfits, and cold drinks.

Example 2: let’s take another example where a government body wants to segment its geography based on the use of plastic bags in its region. The goal is to conduct a use of plastic bags survey. Based on actionable insights into the geographical spread of plastic bags, the governmental body can reinforce administrative supervision to reduce the use of plastics and add new plastic recycling plants in areas of heightened usage.

Each continent or country is further divided into places with distinction in terms of culture, traditions, languages, etc., and there can further be a geographical segmentation. Geographic location is an integral factor that determines market positioning and product sales.

Irrespective of an organization’s market share or product success rate, it’s extremely important for them to conduct market research before launching new products/ services or introducing better or newer features.

Geographic segmentation helps you lower your marketing costs. As a business that wants to cut costs, you would look for places to spend that will give you the best returns. It lets you focus your marketing efforts on a specific area of interest and avoid spending too much.

Learn more about your target audience

Make effective marketing plans.

LEARN ABOUT: Behavioral Targeting

Better experiences for customers

Here are some examples of geographic segmentation:

Products based on season

Size and type of region, food inclinations, launch products or services in new regions.

Learn about: Demographic Examples

Geography isn’t the only thing that affects geographic segmentation. Climate and weather, cultural preferences, and people are also important. Pricing, product availability, and marketing tactics are just some of the things that depend on where an organization is located. 

Let’s explore common geographic segmentation variables.

Religion and culture

Businesses can benefit from geographic segmentation as a marketing tactic in a number of ways. Geographic segmentation offers a number of significant advantages that are given below:

Enhanced focus due to targeting

Immediate market growth, improved communication, increase profits.

Learn more: Demographic Survey Questions

Geographic segmentation lets organizations target customers by region, climate, culture, and other criteria. Businesses can adjust their effective marketing campaigns to each group’s demands by segmenting a market. This improves their advertising and helps them understand and personalize their customers.

LEARN ABOUT:  Test Market Demand

QuestionPro, a top survey and research platform, lets organizations examine customer information by region. This tool helps organizations understand regional customer behavior, preferences, and purchase habits and build focused advertising.

QuestionPro’s regional segmentation function helps businesses target prospective customers and grow their customer base in specific locations. Businesses may improve marketing, customer satisfaction, and income by understanding regional customer needs and preferences.

QuestionPro’s geographic segmentation capability is vital for businesses seeking consumer insight, focused marketing, and growth. This product helps companies compete in today’s market with its sophisticated analytics and simple design.

LEARN MORE         FREE TRIAL

MORE LIKE THIS

Jotform vs Microsoft Forms: Which Should You Choose?

Aug 26, 2024

Stay Conversations: What Is It, How to Use, Questions to Ask

Age Gating: Effective Strategies for Online Content Control

Aug 23, 2024

Work-Life Balance: Why We Need it & How to Improve It

Aug 22, 2024

Other categories

• Academic Research
• Artificial Intelligence
• Assessments
• Brand Awareness
• Case Studies
• Communities
• Consumer Insights
• Customer effort score
• Customer Engagement
• Customer Experience
• Customer Loyalty
• Customer Research
• Customer Satisfaction
• Employee Benefits
• Employee Engagement
• Employee Retention
• Friday Five
• General Data Protection Regulation
• Insights Hub
• Life@QuestionPro
• Market Research
• Mobile diaries
• Mobile Surveys
• New Features
• Online Communities
• Question Types
• Questionnaire
• QuestionPro Products
• Release Notes
• Research Tools and Apps
• Revenue at Risk
• Survey Templates
• Training Tips
• Tuesday CX Thoughts (TCXT)
• Uncategorized
• What’s Coming Up
• Workforce Intelligence

Geographic Segmentation Definition Examples & Variables

What is geographic segmentation.

Geographic segmentation is a process of grouping customers based on where they live. Companies segment their target market geographically when needed to focus on a specific area. Geographic market segmentation tends to optimize the marketing strategies of a business by matching products and services to different regions, cities and countries where the customers live.

All of these parameters help companies to geographically target markets where specific customers or more buyers of their products are present. This provides an effective direction for marketing activities towards those areas that benefit the most.

Generally, this type of segmentation is practiced by organizations that work on a large scale. Through this form, companies offer different marketing messages to local customers and a different message to international customers based on their preferences and likings. Geographic segmentation is also an effective tool that can be used by small companies. Small businesses can target their specific customers and focus primarily on marketing their products . This also allows them to devise market strategies that will stretch both company’s budget and customer base.

In addition to this, rural and urban customer preferences towards a single product are also different. Geographic market segmentation is the right marketing strategy to use as it helps in targeting areas where more buyers of a product are located.

Table of Contents

Examples of Geographic Segmentation

As explained earlier there are various geographic segmentation variables. Some common types of market segmentation variables used by companies to market their products are discussed with below examples.

Geographic Segmentation Regional Preferences and Needs Exists

When companies market a product by region, they must keep in the mind the regional preferences heavily in one region as compared to other regions, this type of segmentation is referred to as regional segmentation.

An example of geographic segmentation can be seen in the seafood industry. In USA, even though seafood is preferred all over the country, however, seafood is extensively marketed in the South and Southeast regions. This is due to the fact that fresh supply is available in these areas all year round, and catering to the demands of customers in these areas is easy.  

Country Based Segmentation

Some companies offer products that are specifically used in some countries only, such as snow shovels are used in snowy areas only. Such products are marketed using geographic segmentation as it helps marketers to target the specific people living in that area.

For example , Dart and True Temper are companies that market their snow shovels in countries with cold temperatures and where snowfall is a normal occurrence. There is no point in marketing snow shovel in areas that are either warm or mildly cold areas with no snowfall. 

Population Based Segmentation

Companies also design their marketing campaigns based on geographic segmentation making population its parameter. This can be the density of population or the population of a specific area.

Examples of products or services that use geographic market strategy include local salons that target their services and products towards the population of a specific area e.g. local population living in the vicinity. Another example of population-based segmentation includes head-covering scarves company that basically targets the population that will want a scarf, e.g. Muslim women. In western countries, such companies will target population where more Muslim women are present to buy their product.

Climate Based Segmentation

Climate-based segmentation refers to marketing products that adhere to a certain climate of an area. Examples of this kind of geographic market segmentation include swimwear brands that are targeted for hot areas with beaches and similarly, raincoats for areas that experience excessive rainfalls, etc.

More common examples of climate-based segmentation are of Walls and Igloo Ice cream companies that market their products heavily in hot areas where sales of ice creams sore high in summers.

Urban and Rural Based Segmentation

Products that serve different needs and wants of people living in rural and urban areas adopt rural and urban segmentation to convey their message to potential customers. For example , a detergent company will market its low-cost detergent product in rural areas because the purchasing power is lesser. People are more interested in products that are of high quality and of low cost.

Similarly, in urban areas, customers prefer their detergent products to be of high quality, fragrant and have other similar qualities even if they cost a bit higher than their almost equivalent low costing substitutes. Thus companies market their low-cost products towards areas with low purchasing power and their high-cost products towards areas with high purchasing power.

Geographic Segmentation Example McDonalds

McDonalds divides its market into geographic segments, for example, different countries, states, regions and cities. McDonalds sells burgers and target local markets and with customized menus. Let’s say, instead of using beef, in India McDonalds burgers are made from chicken due to religious beliefs.

McDonald’s already introduced Maharaja Mac Burger (Big Mac) with no beef and pork due to Hindu Muslim population.

Similarly, in Mexico more quantichilli chili sauce is used.

Geographic Segmentation of KFC

KFC has an international presence and has a number of outlets in different countries. Keeping in view the geographic need of the customers, KFC sells it product the reach the target market worldwide.

For example, In India, KFC is fulfilling its customers demand geographically. In South India, vegetarians are the main selling products, while in North India focus Chicken products.

KFC has a wide geographic segmentation in Australia. Having more than 640 outlets and serves more than 2 million customers a week. Currently, KFC has employed 34000 Aussies. 

About The Author

Ahsan Ali Shaw

Copyright © SurveySparrow Inc. 2024 Privacy Policy Terms of Service SurveySparrow Inc.

What Is Geographical Segmentation? Discover the Power of Targeted Marketing!

Kate Williams

Last Updated: 13 July 2024

11 min read

Table Of Contents

What is Geographic Segmentation?

• Segmentation
• Geographic Segmentation
• 8-step guide

Geographic segmentation involves dividing a market into distinct geographical units, such as countries, regions, or cities, to customize marketing strategies based on the specific needs and preferences of those locations. Imagine that your favorite local shop always has what you want, even before you ask. That’s the power of understanding where you are.

So, what exactly is geographical segmentation, and why does it matter?

What is Segmentation?

It is important to understand what segmentation is if you want to get a better hold of its nuances.

It is the process of dividing a larger market into smaller, identifiable groups of consumers who share similar characteristics, preferences, or behaviors. This division allows businesses to tailor their products, services, and marketing strategies to meet the specific needs of each segment, ultimately improving customer satisfaction and driving sales.

To put it simply, segmentation means splitting a large group of customers into smaller, similar groups. It helps businesses understand their customers better and sell things that people want.

So, what exactly is it? Geographic segmentation refers to the practice of dividing a market into smaller, specific geographic units such as countries, states, cities, or neighborhoods. This approach allows businesses to tailor their products, services, and marketing strategies according to the unique preferences and needs of different locations, ensuring more effective and relevant customer engagement .

Let’s take the example of a company that sells air conditioners.

Geographical segmentation for this business would involve understanding different regions’ climates. In hot and humid areas, like tropical countries, there’s a higher demand for powerful air conditioners. On the other hand, in cooler regions, the demand might be for energy-efficient heating solutions.

By recognizing these regional differences, the company can customize its product offerings and marketing messages. This targeted approach ensures that customers in every area get what they need, making the business more successful in diverse markets.

Features of Geographical Segmentation

Geographical segmentation is a powerful tool for businesses, allowing them to navigate diverse markets with precision and insight. Here are the key features that make geographical segmentation essential in the realm of marketing:

1. Precision in Targeting

It helps businesses identify specific demographics in different regions. By understanding the unique needs of these groups, companies can create highly targeted marketing campaigns. For instance, a company selling ski equipment would focus on regions with snowy climates, ensuring their efforts are concentrated where they matter the most.

2. Cost-Effective Marketing

By concentrating resources on regions with higher potential, businesses can optimize their marketing budget. Let’s admit it, a one-size-fits-all approach does not do the job anymore. Rather than that, they invest in areas where their products or services are in demand, ensuring a higher return on investment.

3. Enhanced Product Relevance

Geographic segmentation allows companies to adapt their offerings to local preferences. For instance, a food chain might localize its menu and include regional delicacies. This customization increases the relevance of products and enhances customer satisfaction and loyalty.

4. Improved Customer Satisfaction

When customers feel that a business understands their specific needs, they are more likely to be satisfied with their purchases. Geographical segmentation ensures that businesses offer products and services tailored to the cultural, economic, and social context of each region. Consider toll-free number service for regional sales teams to further strengthen customer connections. This personalized approach enhances the customer experience and fosters long-term relationships.

5. Strategic Expansion

For businesses looking to expand into new markets, it provides valuable insights. By analyzing the demographics and preferences of different regions, companies can make decisions about where to establish their presence. This strategic expansion minimizes risks and maximizes growth opportunities.

How to Do Geographical Segmentation

By now, you might have understood that it is a nuanced process. It requires a deep understanding of diverse markets and tailoring strategies accordingly. But it isn’t that complex. Here’s an 8-step guide to make this easier for you:

#1 Get Digging with Market Research

Start by digging into data about different regions where you operate. Surveys, market reports, and online tools are your best friends here. Gather insights on what makes each region tick, from cultural quirks to spending habits.

#2 Spot the Standout Variables

Figure out the unique traits of each region. Is it cultural preferences, economic status, or perhaps climate-related needs? Pinpoint the variables that matter most for your product or service. These are your keys to unlocking specific market segments.

#3 Play Sherlock with Data Analysis

Now, put on your detective hat and analyze the data you’ve collected. Look for patterns and differences among regions. What do they have in common? Where do they diverge? This detective work helps you create distinct market segments for each region.

Read More: What is Market Segmentation: The Ultimate Guide

#4 Segmentation Magic Time

Slice and dice your market into these distinct segments. Each segment should represent a group of customers with similar needs or habits in a specific region. Think of it as putting together a puzzle—every piece (or segment) fits uniquely into the bigger picture.

#5 Cook Up Tailored Strategies

This is where the fun begins! Cook up marketing strategies that are as unique as each region. Use region-specific language, imagery, and cultural references in your ads. Tailor your promotions to match local holidays and traditions. The more localized, the better.

#6 Customize Your Offerings

Take a look at your products or services. Can they be tweaked to fit regional preferences better? Maybe it’s a different flavor, a localized feature, or even packaging that resonates with a specific area. Customization is the name of the game.

#7 Stay on Your Toes

Markets change; it’s a fact of life. Keep your finger on the pulse of each segment. Monitor sales, gather customer feedback, and stay updated on market trends. Be ready to adapt your strategies based on what your customers are saying and doing.

#8 Talk to Your Customers

Don’t forget the power of conversation. Engage with your customers in different regions. Ask for feedback, run polls, or simply have a chat on social media. Knowing what they love and what they want helps you refine your strategies and keep your customers happy.

While it is extremely beneficial, it is also important to streamline the lengthy process. You can use advanced tools such as SurveySparrow for data collection and analysis. The platform lets you create engaging surveys, collate data, analyze it, and act upon the insights gained. Yes, you heard it right—all this is possible on one platform!

14-day free trial • Cancel Anytime • No Credit Card Required • No Strings Attached

Importance of Geographic Segmentation

Here’s why understanding and implementing geographical segmentation is crucial:

1. Local Cultural Understanding

By geographically segmenting their customers, businesses can easily gain a deeper understanding of the local cultural differences and nuances of different regions.

It might seem like something that can be sidelined, but understanding local traditions, languages, and customs is essential! Why? To create marketing campaigns that resonate with the community. For instance, a company celebrating a regional festival in its advertisements can create an emotional connection with the local audience. This cultivates loyalty.

2. Smart Pricing Strategies

Different regions have diverse economic statuses, affecting consumers’ purchasing power. Geographical segmentation enables businesses to tailor their pricing strategies according to the economic conditions of specific areas. For instance, offering affordable or budget-friendly versions of products in economically challenged regions ensures accessibility, driving sales even in financially constrained markets.

3. Climate and Seasonal Adaptation

Climate significantly influences consumer behavior. Products and services that are suitable for one region’s climate might not be relevant in another.

Geographical segmentation allows businesses to adapt their offerings based on weather conditions. A beverage company might promote cold drinks in hot regions and warm beverages in colder climates, ensuring their products align with consumers’ needs throughout the year.

4. Competitive Advantage

It helps businesses gain a competitive edge. They can offer unique features or promotions that specifically appeal to a particular region. This individualized approach sets them apart from competitors, capturing the attention and loyalty of the local customer base.

5. Smart Business Investment

We know that resources, including marketing budgets and inventory, are finite. By investing in regions where demand is high and aligning resources with consumer preferences, businesses ensure optimal resource utilization. This maximizes profits while minimizing unnecessary expenditures.

Elements of Geographical Segmentation (Variables)

Geographical segmentation relies on several key variables to create targeted marketing strategies tailored to specific regions. These variables, or elements, serve as the foundation for understanding diverse markets. Here are the essential elements of geographical segmentation:

Cultural Factors

Cultural diversity greatly influences consumer behavior. Language, traditions, values, and lifestyles vary across regions, impacting purchasing decisions. Businesses need to grasp these cultural nuances to create culturally sensitive advertising and products that resonate with the local audience.

Economic Factors

Economic variables such as income levels, employment rates, and overall economic stability play a vital role in shaping consumer purchasing power. Understanding the economic dynamics of different regions helps businesses price their products appropriately, ensuring affordability and accessibility.

Climate and Geography

Climate significantly affects product demand. Products suitable for cold climates might not be relevant in warm regions. Similarly, geographical features like urban or rural settings influence consumer needs. Geographic segmentation considers these factors to adapt products and marketing strategies accordingly.

Social and Demographic Factors

Social aspects such as age, gender, family structure, and education levels impact consumer preferences. Demographic information provides insights into the composition of the population, enabling businesses to tailor their offerings to specific age groups, family sizes, or educational backgrounds.

Technological Factors

Access to technology, internet penetration, and digital literacy levels vary across regions. Technological factors influence online shopping habits, digital marketing effectiveness, and the adoption of innovative products. Geographical segmentation accounts for these variables in digital marketing strategies and product development.

Regulatory and Legal Considerations

Regulations and laws differ from one region to another. Geographical segmentation involves understanding legal constraints, certifications, and product standards specific to each area. Adhering to these regulations is crucial for successful market entry and product acceptance.

Examples of Geographic Segmentation

Here are real-world examples of companies effectively utilizing geographical segmentation:

1. Starbucks: Tailored Global Flavors

Starbucks uses geographical segmentation brilliantly!

In countries like India, where tea is a popular choice, Starbucks offers a unique “Chai Tea Latte,” appealing to the local taste. In contrast, in the United States, where coffee culture is prominent, the focus might be on seasonal beverages like the “Pumpkin Spice Latte.” By adapting their menu to regional preferences, Starbucks ensures that every customer finds something familiar and delightful.

2. IKEA: Furniture for Every Home

In smaller urban apartments in cities like Tokyo, where space optimization is crucial, IKEA offers multifunctional furniture pieces such as sofa beds and foldable tables. In contrast, in larger suburban homes in places like California, IKEA provides spacious furniture sets with a focus on comfort and aesthetics.

By tailoring their designs to match the varying lifestyles and living spaces worldwide, they ensure that customers in different regions find practical and stylish solutions for their homes.

How Marketers Use Geographic Segmentation

Let’s wrap this up by answering the most important question.

Marketers utilize geographic segmentation by tailoring marketing messages, products, and pricing to specific regions. They create localized campaigns, adjust product features to suit local needs, offer region-specific promotions, engage with audiences on social media, optimize distribution channels, and target online advertising based on geographic location. This targeted approach ensures that businesses connect with customers on a personal level, boosting sales and brand loyalty.

Moreover, streamlining the process is crucial to gaining a competitive edge. Give SurveySparrow a spin before you leave!

Content Marketer at SurveySparrow

You Might Also Like

Customer Experience

Customer Feedback System [CFS]: A Mini Guide

Digital Marketing Customer Experience: Elevate Your Brand's Engagement

The Perfect Zoom Set Up | Set Up Zoom Meeting

Nominal Data 101: Definition, Examples, Analysis

Turn every feedback into a growth opportunity.

14-day free trial • Cancel Anytime • No Credit Card Required • Need a Demo?

Root out friction in every digital experience, super-charge conversion rates, and optimize digital self-service

Uncover insights from any interaction, deliver AI-powered agent coaching, and reduce cost to serve

Increase revenue and loyalty with real-time insights and recommendations delivered to teams on the ground

Know how your people feel and empower managers to improve employee engagement, productivity, and retention

Take action in the moments that matter most along the employee journey and drive bottom line growth

Whatever they’re are saying, wherever they’re saying it, know exactly what’s going on with your people

Get faster, richer insights with qual and quant tools that make powerful market research available to everyone

Run concept tests, pricing studies, prototyping + more with fast, powerful studies designed by UX research experts

Track your brand performance 24/7 and act quickly to respond to opportunities and challenges in your market

Explore the platform powering Experience Management

• Free Account
• Product Demos
• For Digital
• For Customer Care
• For Human Resources
• For Researchers
• Financial Services
• All Industries

Popular Use Cases

• Customer Experience
• Employee Experience
• Employee Exit Interviews
• Net Promoter Score
• Voice of Customer
• Customer Success Hub
• Product Documentation
• Training & Certification
• XM Institute
• Popular Resources
• Customer Stories
• Artificial Intelligence
• Market Research
• Partnerships
• Marketplace

The annual gathering of the experience leaders at the world’s iconic brands building breakthrough business results, live in Sydney.

• English/AU & NZ
• Español/Europa
• Español/América Latina
• Português Brasileiro
• REQUEST DEMO
• Experience Management

Brand Experience

Market Segmentation

• Geographic Segmentation

Try Qualtrics for free

What is geographic segmentation and how to put it to work.

12 min read Whether you’re a brand looking to go global, or a small business focusing more on the local, geographic segmentation is one of the most effective types of market segmentation. What is it, and how can you put it to best use?

What is geographic segmentation?

Geographic segmentation is a marketing strategy used to target products or services at people who live in, or shop at, a particular location. It works on the principle that people in that location have similar needs , wants, and cultural considerations. By understanding what people in that area require, brands can target more relevant marketing messages and suitable products to customers who are then aware and more likely to buy.

Why is it important to segment customers based on geographical variables?

• It makes your brand relevant : targeted marketing campaigns attract customers and increase revenue because they appeal to the needs and wants within a geographic location, triggering purchases.
• You save money : your marketing budget is more efficient when it offers appropriate and available products and services, rather than being wasted on promoting things that nobody needs
• It’s easy : Location information is objective, easy to measure and analyse, and cheaper than psychographic , demographic or behavioural segmentation
• Larger companies : can offer different or more relevant products in different geographic areas, and market them more efficiently there
• Smaller companies : can target marketing directly at their specific areas of interest and target audience , rather than taking an inefficient blanket approach

eBook: How to Drive Profits with Customer Segmentation

Geographic segmentation advantages

As you have a finite amount of money to spend on marketing, geographic segmentation will give you the best chance of successfully connecting with specific audiences. Here’s what it can do for your organisation:

• Increase profits: As geographic segmentation allows you to target specific audiences and deliver tailored marketing campaigns, you can generate profits faster while saving time and money.
• Drive growth : By targeting the right people, you can increase sales and drive business growth. Ensure you revisit your geographic segmentation regularly — especially when entering new markets or advertising new products — to get the best value from your campaigns.
• Focus efforts: Geographic segmentation allows you to target location-specific keywords and demands. This is incredibly useful if you’re operating with a smaller budget or want to develop awareness in a particular region.
• Improve communication : Every region has different needs, shopping habits and ways of doing business. Geographic segmentation takes into consideration the way people communicate within regions and communities. With this kind of insight, you can move forward with confidence and ensure a high engagement rate from the start.

Geographic variables (with geographic segmentation example list)

There are several geographic parameters (or types of market segmentation) you can use to focus your marketing efforts and target your customer base. Each geographic segmentation example explores the different variables, to give you a better picture of how to use it in practice in your target market.

This variable can impact geographic segmentation by covering a small area, like a neighbourhood, or a large area like a continent, with towns, cities, states and countries in between.

If companies have your location data, it may impact the kinds of sales ad messages you receive. For example, if you’re looking for nearby restaurants in New York City, then Google search results will use your location (based on your device’s IP address) to search for places to go in a small radius.

Another way products differ by location is through target market buying preferences. For example, Nike in the US is likely to focus on American football and baseball , while you’re unlikely to see American football or baseball commercials in Europe – you’ll see product ads for Soccer (Football in Europe) instead.

If you’re targeting a new geographic location with your segmentation strategy, ensure you understand the nuances of the regions you want to operate in!

Image Source: Nike

Climate segmentation involves selling products that are appropriate for the climate, weather, and season in a particular area. This means that the right products and services are chosen for the climate.

For example, if you’re planning a trip to Antarctica, warm clothes and boots will be crucial to keep you comfortable and safe. Therefore, if you’re a winter boots manufacturer like Cool Antarctica, your product marketing strategy revolves around targeting people who are searching for holidays in that region.

Image Source: CoolAntarctica

You may have to adapt your products to take account of cultural variations and sensitivities. In different countries and regions, it’s not culturally acceptable to serve certain products or some customs prescribe a certain dress code.

For example, with McDonald’s, the company takes into consideration cultural differences . In India, McDonald’s doesn’t serve any beef or pork in any form, in any of their outlets. Instead of ground beef and pork patties, the McDonald’s menu in India features Indian burgers that are 100% vegetarian.

The reason for this is that diets in India have been affected by different religions for centuries. Hindus don’t eat beef — and the cow is considered sacred. Since the majority of the population follows Hinduism, there’s no beef on McDonalds’ menu in India . There’s also no pork out of respect for Muslims.

Also, different countries will enjoy different flavours and often have unique items, such as Thailand McDonald’s (Samurai Pork Burger) vs. UK McDonald’s (Mozzarella Dippers).

An integral factor of your marketing efforts is understanding the potential customers within your geographic location. Population density or population type will help make effective marketing campaigns because you’re more likely to relate to and serve customers within your target audience groups.

A brand may choose to market in cities rather than rural areas because there are simply more target buyers, and urban distribution is easier. On the other hand, a Chinese grocery store would do more trade in a city area with South Asian communities, than in a less diverse rural farming village.

For example, in China and Japan, capsule hotels are an increasingly popular method of accommodation for Japanese citizens who want to keep costs low. For tourists, on the other hand, demand for traditional hotels is on the up.

Urban, suburban and rural

These different environments – across urban, suburban, and rural communities – require different marketing strategies.

Customer needs are different: e.g. a car manufacturer may target their smaller, electric vehicles at city and suburb dwellers, while rural customers may enjoy larger, four-wheel-drive cars.

Generally, customers in cities and suburbs have more purchasing power than rural areas, so products can be more expensive . The site Realtor.com recently ranked Salt Lake City as the No. 1 housing market positioned for growth in 2022 , providing a 15.2% year-over-year sales growth.

Image Source: Forbes

Not everyone can, or wants to, read marketing in English, Spanish, or Mandarin. It’s essential to use languages of targeted areas for labelling, online communication, and promotion. More than 20% of the population in the US speaks a language other than English at home, according to 2017 U.S. Census data .

There’s a lot of support for this with marketing platforms – for example, Google Ads says it offers language targeting, which lets you target your ads to potential customers who use Google products and third-party websites based on the languages those customers understand.

Language learning brand Berlitz used language misunderstanding very effectively to connect two geographic segments at once (German and English) in the famous TV ad about a new German Coastguard on his first day at work:

Examples of how organisations use geographic segmentation

There are many ways geographic segmentation might be applied in different scenarios, such as:

• A pool supplies manufacturer targets warmer, sunnier climates
• A liberal political action group has more success fundraising in the Pacific Northwest rather than the Southeast
• A clothing retailer adjusts its inventory according to the weather and styles of its store locations
• Restaurant chains customise their menus according to the local tastes and ingredients available in their areas
• Local businesses open locations in areas where the average income is appropriate for the price of their goods
• Home security companies may have more success focusing on high-crime areas
• Retail businesses are more likely to be successful in high-population areas
• Healthcare organisations may provide Spanish language service options in areas with large Hispanic communities

How to build a geographic customer profile

There are many tools that can help you layout a geographic segmentation strategy:

Survey research

One of the first tools businesses turn to in order to understand the geographic preferences of their customer base is to conduct survey research . Here are four survey research approaches you may want to consider:

• Take a random sample of your customer base and ask about their product preferences. Filter the results by region to breakout geographic preferences.
• Use conjoint analysis methodology to rank order product traits using trade-off questions and filter results by state or region to understand which regional differences exist.
• Test your messaging and advertising concepts with prospects in different areas to understand where different messages are well or poorly received .
• Survey your employees in different regions to understand how engagement may affect the customer experience they are providing per region.

Check your operational sales data to see where product sales are increased or decreased by region. Consider trends in seasonality to understand how they affect your sales by region. Combine your sales operational data with your customer experience and survey data to pick up trends by region.

Website data

Use web traffic tracking patterns by region to see where your traffic is coming from. Conduct analysis on the types of products that ship to various regions to pick up differences in purchase preferences.

Mobile usage data

Mobile devices present unique opportunities to better understand customers by very specific location – sometimes down to the foot. By using app-based location services available with most smartphones, you can send the right message at the right time with pinpoint accuracy.

Social media profiles

Social media data can provide tremendous insights into the location preferences of your customers and prospects. Many social media platforms even allow you to target messaging by area or zip code.

Secondary data sources

Many third-party technologies and agencies specialise in helping you to build and execute a geographic segmentation strategy. Claritas PRIZM , Carto , and ad platforms like Google and Twitter are often able to help you target the right prospects in the right locations.

Think and act like a local company

Overall, geographic segmentation is a strategy that is crucial for any organisation that provides services that vary based on regional factors like climate, local styles, distribution differences, channel availability, culture or values.

Employing an effective marketing plan based on geographic segmentation can be a key competitive advantage for organisations that understand how to ‘think local’.

For more on how you can use these types of market segmentation to reach your target market and target audiences, check out our eBook below.

Get the eBook: How to Drive Profits with Customer Segmentation

Related resources

Demographic segmentation 14 min read, market segmentation 21 min read, behavioural segmentation 20 min read, what is psychographic segmentation 11 min read.

Brand Awareness

Brand Awareness 17 min read

How to build a brand 14 min read, ideal customer profile 10 min read, request demo.

Ready to learn more about Qualtrics?

Geographic Segmentation: Definition, Pros & Cons, Examples, and More

Free Website Traffic Checker

Discover your competitors' strengths and leverage them to achieve your own success

Ever wondered why some marketing campaigns hit the mark while others completely miss it? The answer often lies in how well the target audience is understood, especially in terms of location.

Geographic segmentation is a powerful tool that allows businesses to tailor their marketing efforts based on geographical factors, ensuring messages, products, or services resonate with specific regions. This strategy not only adds value to your marketing activities but also ensures customers feel understood and catered to.

What is geographic segmentation?

Geographic segmentation divides a market into smaller units based on location—whether that’s countries, states, regions, cities, or even neighborhoods. Businesses can then adapt their marketing plans to suit the unique characteristics of each locale, considering factors like culture, climate, language, and local laws, all of which profoundly impact consumer behavior .

For instance, a clothing brand might heavily market its latest swimwear in warmer states during summer while promoting winter apparel in colder states. These tailored approaches significantly increase the chances of successful engagement with your target audience.

This strategy is crucial not just for meeting customer needs but also for shaping your organization’s approach to the marketplace. By understanding local market intricacies, geographic segmentation helps businesses expand their footprint more smoothly.

From global giants like Amazon and Apple to small local businesses, geographic segmentation allows precise targeting, making marketing efforts more effective and resource-efficient. In this article, we’ll explore why geographic segmentation is essential, its advantages and disadvantages, and how to conduct one using tools like Similarweb to gather geographic data.

The importance of geographic segmentation for your business

A solid marketing strategy is rooted in understanding the geography of your audience . Geographic segmentation plays a vital role in gaining this understanding.

Here’s why it’s crucial:

Messages that align with regional cultural values, language specifics, and interests are more likely to connect deeply with your audience. Beyond engagement, this creates a closer association with your brand. Customers are more loyal to companies that understand their unique challenges and preferences. For example, advertising winter tires in regions with harsh winters is far more effective than targeting sunny beach locales.

Cost efficiency

Another major advantage is cost efficiency. Marketing campaigns can be expensive, and without proper targeting, they might not yield a significant ROI. Geographic segmentation allows for more cost-effective resource allocation, focusing efforts where they matter most. This is especially beneficial for smaller businesses with limited budgets, enabling them to compete effectively by maximizing the impact of every marketing dollar.

Scalability

Scalability is key to growing a business. Once you’ve successfully tapped into one market, many of the same strategies can often be adapted for similar regions. Geographic segmentation simplifies this process, providing a framework for expansion based on previous successes.

For instance, a brand that succeeds in a state within the United States – for example, one that produces similar demographics and preferences – may then replicate many of the same strategies in another state, saving time and reducing the risks associated with new market ventures.

Local insights

Finally, local insights offer very useful information for localized marketing. Companies that understand regional tastes can, therefore, create products and services that are more attuned to the needs of locals. Customization of this nature brings across to the customer that their special needs are being attended to, which still further instills brand loyalty .

Advantages and disadvantages of geographic segmentation

While geographic segmentation offers numerous benefits, it also comes with some noteworthy challenges. Let’s dive into the pros and cons:

Geographic segmentation presents several benefits, which is why it’s one of the most preferable strategies for businesses in their quest to realize maximum profitability in their marketing processes. Some of the leading benefits of geographic segmentation include:

1. Increased profits

Well-aligned marketing strategies keep in mind the needs of the audience and may often lead to more profits. For instance, running localized marketing campaigns generally works much better than a one-size-fits-all marketing campaign. According to a report by MessageGears , 83% of consumers report that they prefer connecting with brands that offer hyper-personalized marketing messages. In such a scenario, personalized marketing finally translates into higher engagement from the customers, and hence, it leads to more sales.

2. Resource optimization

This technique helps companies target regions with maximum potential to execute marketing budgets effectively. They would avoid wastage in places where the engagement is less and focus on regions where their marketing messages will have maximum impact. This is very useful for startups and small businesses with limited budgets as it makes sure that every marketing dollar is well-spent.

3. Improved communication

Communication can be improved upon with deep knowledge of regional languages, dialects, and styles of communication. It’s at the root of any good marketing campaign, and knowledge about what to tell the local audience and how to say it helps. An advertisement run in Spain with some local highlights in Spanish is going to fare much better than a standard ad in English.

4. Customer satisfaction

Customer satisfaction is directly related to how well the products and services of a company meet local needs. Knowledge of these needs will help businesses make the right decisions on product offerings and service delivery.

For example, a beverage company can just add some flavors to suit the local taste, or a clothing brand can provide regional fashion styles. Such attention to detail may consign a very loyal customer base that feels understood and appreciated.

Disadvantages

While there are some advantages associated with geographic segmentation, it is also important to understand that there are some associated disadvantages:

1. Potential to overlook opportunities

This can be missing out on various other opportunities that arise. If too much focus is given to one area, it may cause a company to overlook untapped markets that offer enormous growth potential. This requires a delicate balancing act between spending time in areas of high potential and relatively unexplored areas and continuous market analysis . It is advisable to implement diversified approaches to make sure that the business does not put all its eggs in a single basket to avert this risk.

2. Complexity in management

Another challenge is the management complexity. Geographic segmentation has to deal with several marketing strategies for different regions, which can be complex and resource-intensive. The running of such concerted efforts calls for advanced logistics and a specialized team that may stretch the resources of the company to a breaking point. A number of these complexities can be reduced by using advanced marketing tools and platforms. However, the upfront investment may be huge.

3. Risk of stereotyping

The risk of stereotyping is another aspect of geographical segmentation. It’s easy to fall into the trap of generalizing about a region’s needs, assuming all people in a geographic area have similar tastes and preferences. Assumptions like these can be hallmarks of some pretty ineffective, or even counterproductive, marketing. Not every consumer in Texas wants cowboy-themed products, and not every New Yorker has an interest in high fashion. To avoid such pitfalls, detailed market research should be conducted to know the various needs in any given region.

Geographic segmentation variables and examples

Geographic segmentation depends on the likes of location, climate, culture, and population density, and this enables companies to fine-tune their strategies. These help companies localize effectively: Here are some good geographic segmentation examples:

Amazon shows very good use of geographic segmentation in its markets. The company operates many domains for different regions. The top five domains are amazon.com for the USA, amazon.co.jp for Japan, amazon.de for Germany, amazon.in for India, and amazon.co.uk for the UK.

This way, the company can tailor its product assortments, marketing messages, and promotions according to regional preferences. It better controls the supply chain as well as its region-specific deals.

Even retail brands like Zara segment their marketing tactics based on climate. They advertise winter collections in geographies having long winter conditions and make use of showcasing summer wear in the parts with warmer conditions. As see below, keywords and landing pages for winter clothes are more popular for areas such as South Korea, UK, and Japan. This aligns the product offerings with the seasonal needs of individual geographies, so they have higher relevance and more sales.

Global fast food chains such as McDonald’s have tailored their menus to suit the local flavor and cultural preferences. They have vegetarian options on the menu in India, as dietary practices are largely influenced by religious beliefs. The ‘Teriyaki Burger’ is their offering in Japan to connect with local flavor preferences.

Population density

Big brands like Nike practice market segmentation between urban and rural areas. For the heavily urbanized markets, like the US, UK and Germany, it launches lifestyle or fashion-oriented products; whereas in a more rural setting, the focus is ofen on sports apparel and outdoor gear.

How to gather geographic data using Similarweb

Similarweb provides a comprehensive market research tool to gather and analyze geographic data. This data can be used by businesses to make informed decisions. This platform can help in taking out geographic data through several modules.

1. Website Analysis

Using the Website Performance tool in Similarweb, you’ll be able to have an idea of the geographical traffic distribution for your competitor’s websites. Just input the domain’s URL to find out the countries driving the highest volume of traffic so you can later tune your marketing strategies accordingly. The main metrics for traffic include total visits, device distribution, and country and global rank.

• Total Visits: This is the sum of all visits to the domain within the selected timeframe.
• Device Distribution: This is the percentage of the traffic from desktop versus mobile devices.
• Global Rank: It is defined as the ranking of that particular website based on its highest summed value for monthly unique visitors and page views globally.
• Country Rank: This comes from a ranking within the top websites of the country. It is calculated as the largest sum of monthly unique visitors and page views altogether.
• Category Rank: It’s the maximum number of monthly unique visitors and page views across any site within a category representing the primary website.

You can use this data to benchmark against your competitors and could reveal growth opportunities in niche markets .

For instance, a fashion ecommerce website would learn that most of its competitor’s traffic comes from Europe. It would then consider regionally targeted marketing campaigns and optimize product listings for European fashion tastes.

2. Market analysis

In the Market Analysis module, an existing industry or custom industry can be looked at and the country traffic and engagement metrics taken into account. Key data points one could take away include:

• Country: Geographic location to which traffic is received for the analyzed segment.
• Traffic Share : The estimated percentage from each country targeted at the segment in comparison to the total website traffic.
• Visit Duration : Average length of a visit in hours, minutes, and seconds.
• Pages/Visit : This is the average number of pages per visit for your chosen period.
• Bounce Rate : The percentage of visitors to a particular site who leave just after viewing one page and do nothing else.

For example, an ecommerce company might have high bounce rates in one country and optimize the user experience of its website specifically for that region. Statistics on traffic share by country guide businesses to focus on regions that most contribute to their online presence.

3. Demand analysis

Using the Demand Analysis tool will enable you to generate a keyword list, view search traffic by country, and track micro trends to predict demand shifts across different areas of the world. Some of the features it comes with include:

• Demand Size: This lets you in on the significance and direction of the search demand for a topic. Trends are designated as growing (over 5 percent), stagnating (5 percent to -5 percent), or declining (over -5 percent).
• Demand Trend: You could monitor your search trends to determine what’s happening to the topic over time to know whether it’s peaking, growing, declining, or seasonal.
• Keyword Trends: Using this information, you will be able to see which of the keywords on your list is driving the most volume in search.
• Keyword Trends Summary: You can dive into this full list of keywords by seeing their search volume, percentage share, and change over time.

For example, a technology company might notice an increase in searches for a new product feature in one region. This insight helps to align product development and marketing strategies toward effectively meeting regional demand.

Tailoring your global marketing strategy to local needs

Geographic segmentation allows businesses to cater to regional preferences, resulting in more targeted offerings, improved customer satisfaction, and higher market penetration. It’s an effective way to optimize marketing ROI and ensure precise targeting.

With tools like Similarweb, you can gain insights that drive business growth through data-driven decisions . Leverage geographic segmentation to navigate market fluctuations and sharpen your strategies with a more granular view of geographical markets.

Start your data-driven geographic segmentation analysis today to:

• Gain a comprehensive understanding of your competitive landscape and identify key players in your target markets
• Track and analyze any website or app to boost online sales
• Discover competitors’ winning marketing strategies and their top-performing products

Enjoy 360° digital visibility, 24/7

The all-in-one solution for data-driven planning and competitor analysis.

What are some of the problems business organizations encounter in geographic segmentation?

Problems often associated with geographic segmentation include collecting and analyzing tons of geographic data, which can be complex, overgeneralizing regions, and extra costs incurred on the development of multiple campaigns localized in different regions. Moreover, region-specific strategies need to be developed and sustained through constant monitoring and prompt adaptations to keep up with the dynamic market conditions.

Can geographic segmentation work alongside other segmentation methods?

Yes, geographic segmentation combined with demographic , psychographic, and behavioral segmentation is a comprehensive market strategy. This will provide more insight into consumer behavior and preferences so effective marketing efforts can be applied.

How often should a business review its geographic segmentation strategy?

A review of geographic segmentation strategies should be done once a quarter or twice a year. In this way, the strategy will be updated and changed according to the shifting market conditions, consumer behaviors, and competitive landscapes . This will allow businesses to make adjustments promptly to major geographic preference shifts.

Which tools can support the collection and analysis of geographic data?

There are a host of geographic data mining and analysis tools at one’s disposal, ranging from Similarweb and Google Analytics to dedicated market research platforms. Enterprises can make use of these tools to gain full geographic insights into web traffic, consumer behaviors, and market trends across various regions and effectively tailor strategies.

How can geographic segmentation be used by businesses to improve customer satisfaction?

Businesses can serve customers better by offering products and crafting messages that meet the needs and preferences of different geographic segments. The product variety by region, customer service support localization, and marketing messages that reflect the local culture and values help to build more trusting and loyal customers.

by Monique Ellis

Content Marketing Manager

Monique, with 7 years in data storytelling, enjoys crafting content and exploring new places. She’s also a fan of historical fiction.

Related Posts

Importance of Market Research: 9 Reasons Why It’s Crucial for Your Business

Audience Segmentation: Definition, Importance & Types

Demographic Segmentation: The Key To Transforming Your Marketing Strategy

Unlocking Consumer Behavior: What Makes Your Customers Tick?

Customer Segmentation: Expert Tips on Understanding Your Audience

Market Demand 101: How to Gauge Demand for Your Products

Wondering what similarweb can do for your business.

Give it a try or talk to our insights team — don’t worry, it’s free!

Understanding Geographic Segmentation: Factors, Benefits, and Examples

Amanda Amore July 13, 2022 Remarketing Experience

Today more than ever, personalization is the key to optimizing the user experience and driving sales and brand loyalty. Leveraging data collection to create a personalized experience is an important aspect of strategic marketing. Segmentation is a means of categorizing that data in order to guide campaign direction.

Segmentation helps companies organize their audience into smaller categories, allowing for more effective brand communication.

While all marketing segmentation shares the same basic goal, there are four distinct types :

• Demographic Segmentation: groups customers based on non-character traits such as gender and age.
• Behavioral Segmentation: groups customers based on past actions such as browsing and spending habits.
• Psychographic Segmentation: groups customers based on character and personality traits such as interests and beliefs.
• Geographic Segmentation: groups customers based on their physical location.

Of the four types of marketing segmentation, Geographic Segmentation is probably the least talked about. But Geographic Segmentation is an immensely important marketing strategy that helps brands solve real world problems using demographic information, while conserving marketing costs – win-win!

So, what exactly can Geographic Segmentation do for you? I’m so glad you asked.

What is Geographic Segmentation and Why is it Important? 

Geographic Segmentation refers to when a business divides its target market based on geographic location in order to better personalize content.

The Six Variables of Geographic Segmentation

Location: there is an abundance of options when it comes to segmentation based on location. You can group by town, country, or even continent. You can even identify a new geographic area of opportunity.

Time Zone: this is particularly important for offers that have a certain timeframe. It also comes in handy for email marketing send times.

Climate and Season: this type of segmentation ensure’s that the products you are marketing adhere to an area’s climate, such as swimwear being targeted to hot areas with beaches.

Cultural Preferences: different markets have different cultural variations and sensitivities. This expands across copy, design choices, and more. You can lean on census data to help inform your segmentation efforts.

Language: in places where a variety of languages or dialects are spoken, messaging potential customers in a way that accounts for their own cultural preferences is powerful – and makes it far more likely you’ll get your point across.

Three Advantages of Geographic Segmentation

1. easy to implement.

The data required for Geographic Segmentation can be easily gathered with market research. You can simply survey your target audience, even via social media, to attain their geographical location. That information can then serve as a powerful tool to inform Geographic Segmentation. Going back to our climate-based segmentation example, imagine a business that sells both warm weather and cold weather apparel. It’s easy to see how being armed with the information to target users in a warm climate with swimwear as opposed to heavy outwear can quickly advance marketing campaigns.

2. Highly Relevant Marketing Campaigns

It’s incredible how many ways a company can leverage the simple information of where its audience is located. Geographic Segmentation creates overall improved communication, tailored brand messaging, and relevant campaigns featuring products based on a user’s location. Let’s take a look at a few examples of how it can foster highly relevant marketing campaigns.

Accounts for Local Needs

Even within the United States, regional preferences vary widely for many kinds of products. Consumers’ needs vary immensely in urban areas vs. rural areas. These needs should be reflected in your marketing efforts. Think: a company that sells lawnmowers wouldn’t benefit from marketing the same large riding mowers, best suited for rural areas, to urban apartment dwellers. By adapting your brand to suit the needs and tastes of people living in different areas, you utilize your resources in a more effective way, enhance your value proposition, and demonstrate how your products or services improve the daily lives of consumers.

Addresses Climate Differences

The weather plays a huge role in our day to day lives. Many of the products you can effectively market will vary depending on the climate in that region – just like in our climate-based segmentation example. But climate determines far more than just the clothes we wear. It also has a heavy influence on the foods we eat and how we spend our time. By adjusting your marketing strategy to suit climate, you can engage customers more effectively and avoid spending money in markets where your product is less relevant.

Breaks Down Language Barriers

In the United States, more than 26 million people speak a second language at home. This means that if your ads are only available in English, you’re making it more difficult for people to understand your messaging. Fortunately for marketers, many non-English speakers are concentrated in particular areas of the country.

For example, Los Angeles has more native Spanish speakers than English speakers. Obviously, a Spanish language ad-placement could be risky in some areas. Although, in a place like L.A., brands can delight and surprise non-English speakers in their preferred language.

3. Cost Efficient

Geographic Segmentation optimizes campaign spending in two ways. First, it avoids unnecessary advertising costs by helping you spend your money on marketing only to a particular area where your product or service will sell. Second, it ensures the ads you do run are relevant to your audience. Any marketing tool that helps you optimize costs and increase profits is certainly a tool worth implementing.

Geographic Segmentation Campaign Examples

Climate and Season

Population Density

Segmentation Connects You to Your Customers

Ultimately, marketing seeks to establish a connection between brand and consumer. Marketing is most effective when consumers feel as though a brand “gets” them. When the data from Geographic Segmentation guides the creative, it paves the way for your brand to display a better understanding of the consumer. By understanding the advantages of Geographic Segmentation and adapting messaging to regional audiences, brands can increase engagement, reduce waste, and improve market positioning.

Looking for More Ways to Increase Your Conversions?

Check out UpSellit’s 27 Attributes of an Effective Email . This in-depth guide covers the ins-and-outs of crafting the perfect remarketing email. It’s a great resource and it’s totally free! Download it today and start writing awesome emails that convert.

• Website Experience
• Remarketing Experience
• Coupon Experience
• Solution Guides
• Success Stories
• CRO Best Practices

Geographic Segmentation Essays

Strategic plan for real estate excellence by the morel family group, popular essay topics.

• American Dream
• Artificial Intelligence
• Black Lives Matter
• Bullying Essay
• Career Goals Essay
• Causes of the Civil War
• Child Abusing
• Civil Rights Movement
• Community Service
• Cultural Identity
• Cyber Bullying
• Death Penalty
• Depression Essay
• Domestic Violence
• Freedom of Speech
• Global Warming
• Gun Control
• Human Trafficking
• I Believe Essay
• Immigration
• Importance of Education
• Israel and Palestine Conflict
• Leadership Essay
• Legalizing Marijuanas
• Mental Health
• National Honor Society
• Police Brutality
• Pollution Essay
• Racism Essay
• Romeo and Juliet
• Same Sex Marriages
• Social Media
• The Great Gatsby
• The Yellow Wallpaper
• Time Management
• To Kill a Mockingbird
• Violent Video Games
• What Makes You Unique
• Why I Want to Be a Nurse
• Send us an e-mail

Starbucks’ Market Segmentation

• To find inspiration for your paper and overcome writer’s block
• As a source of information (ensure proper referencing)
• As a template for you assignment
• The Segmentation Variables used by Starbucks

Specialty Coffee Business

Differentiation strategy, competitive positioning strategy.

It is essential to take the market segmentation of Starbucks into account when analyzing the company’s business model. Marketers use various segmentation variables to categorize the consumers into specific groups based on particular distinctive attributes. In this way, they are able to design different marketing strategies for each segment. Starbucks Corporation uses geographic, demographic, and psychotropic variables to structure its market.

This paper describes Starbucks’ market segmentation and marketing strategy. It provides the variables the writer will use to compete with the retailer in his specialty coffee business. It also details the product differentiation and positioning strategies that will enable the coffee shop to compete effectively in the market.

Starbucks’ Segmentation Variables

Marketers use market segmentation to divide a target market into groups bearing similar attributes or needs. They use geographic, behavioral, lifestyle/psychotropic, and demographic variables to organize markets into segments (Kotler & Armstrong, 2014). The geographic segment includes consumer groupings defined by administrative units (geographical regions) and physical factors, such as climate. Marketers also use demographic variables such as age, gender, and income level, among others, to organize a given market. Additionally, firms that offer multiple brands use psychotropic variables, such as lifestyle, to organize a market into different segments.

In the writer’s opinion, Starbucks Corporation organizes its market based on three variables, namely, demographic, psychotropic, and geographic. The company then uses product differentiation to satisfy the different customer groups. With regard to geographic segmentation, Starbucks has retail outlets distributed in different locations. Each of these outlets reflects the tastes and preferences of the local consumers.

Although the outlets are similar in design, they differ in terms of product category (coffee and baked food) and size. Additionally, Starbucks uses geographic variables to segment its international markets. According to Kotler and Armstrong (2014), firms planning to enter new markets categorize countries or regions based on geographic variables such as “income levels, religions, languages, customs, and political stability” (p. 112). In the writer’s view, Starbucks uses the same segmentation criteria to enter and thrive in foreign markets.

The company also provides a broad range of teas and baked goods with variable dietary content to cater for different tastes and preferences. Its menu contains nutritional information that clients can read before placing an order. Additionally, the firm has an online community dubbed ‘Coffeehouse’ that enables patrons with similar tastes to interact ( Our Heritage , 2010). In this view, Starbucks divides its market into psychotropic segments based on lifestyle factors and customer traits. With regard to demographic segmentation, Starbucks’ various outlets have facilities that appeal to the all generations and income groups. Each outlet has comfortable seats and lounges as well as free internet (Wi-Fi).

A specialty coffee startup can face stiff competition from big retailers like Starbucks. To compete effectively, the writer will use segmentation variables to organize the target market. First, the writer will define the customer types that the coffee shop will serve. Their characteristics will help design the types of coffees that the shop will offer and develop a marketing strategy to compete effectively. To achieve this, the writer will use demographic, psychotropic, and behavioral variables.

The demographic factors that will be useful in segmenting the market include age, level of income, and occupation. The reason for using these demographics is to design products/services that appeal to clients of all age groups, incomes, and occupations. For instance, the occupation of the customers will determine if the shop will have a meeting area or offer packaged takeaways that patrons can consume in their offices. Their income level will inform the pricing strategy for our products. Age will determine the type of in-house entertainment, music, and internet facilities that the business will offer. Counter and table services will be available to patrons of all ages. The shop will also offer free birthday drinks to appeal to clients of all age groups.

The writer will use psychotropic variables, such as customer styles and tastes, to segment the market. The patrons’ music and food tastes will indicate the type of entertainment and products to offer. Different coffees of variable dietary content to suit diverse customer tastes and characteristics will be available to our clients. Additionally, the shop’s interior design and decor will be made in a manner that reflects the different local styles. The reason for using these psychotropic variables is to provide products that meet diverse client needs.

The behavioral variables that marketers use to segment markets include “consumer loyalty, occasion, benefits, user status, and usage rates” (Porter & Claycomb, 1997, p. 65). The writer will use these variables because they reflect the consumption behavior of customers and therefore, useful in market targeting. The writer will use loyalty cards to reward loyal customers based on the number of times they visit the shop. In contrast, usage rates will indicate the level of coffee consumption among the different groups.

A firm gains competitive advantage by differentiating its products in a way that offers greater customer value. According to Kotler and Keller (2011), firms use a value proposition to help consumers distinguish their merchandise from those of rivals. In this view, they make customers to believe that a firm’s product gives extra benefits compared to those offered by rival companies.

Kotler and Keller (2011) further state that product differentiation involves two stages, namely, defining the value differences and promoting those differences in the market. A firm must first determine a value difference that can enhance competitiveness before promoting it. In this regard, differences that are “profitable, affordable, superior, and distinctive” are worth pursuing (Kotler & Keller, 2011, p. 75).

The shop will differentiate its products in terms of design, quality, and performance features. It will promote the identified product differences in these attributes between Starbucks’ beverages and its coffee using different strategies. One differentiation strategy the shop will use is the value proposition approach.

It will use a compelling value proposition to inform customers that it offers the finest espresso coffee in the market. Starbucks prides itself in providing multiple coffee brewing methods and a host of other products, including teas, juices, and pastries. The shop will only focus on espresso coffee. In this way, it will create a unique niche reputation and avoid confusing consumers. This approach will also portray the shop’s espresso coffee offerings as being of superior quality. It will also cut down capital costs and contribute to better management.

The shop will also use a pricing strategy to differentiate its product offerings. On average, Starbucks sells its beverages at a price that is $2 higher than the cost of similar products sold by other competitors. The shop will charge lower prices for its products, but offer extra benefits to its customers. In this way, customers will feel that they get value for their money. The shop will also adopt the Italian coffee culture. Starbucks usually uses syrups and other sweeteners to improve the taste of their coffee ( Our Heritage , 2010). Fine Italian coffee does not need such ingredients to taste good. In this regard, the shop will brew its espresso coffee the Italian way to provide distinctive and superior quality products.

Starbucks often uses automated machines in the preparation of its products. It uses machines to cut down labor costs and enhance the uniformity of its coffee. However, the automated machines cannot adjust the variables and flavors that define quality in espresso coffee. In this regard, the shop will only use manual machines to adjust the variables that enhance the quality of the coffee. This will also help provide coffee of variable taste and nutritional content for different customer groups.

The position of a brand in the market depends on how consumers perceive its benefits, quality, and other attributes (Jain, 2009). Since Starbucks is an established beverage retailer, new entrants that offer products at comparable prices will not compete effectively. Thus, the “more for more positioning strategy” will only result in losses, as customers will continue to frequent Starbucks (Jain, 2009, p. 51). In this view, the shop will use the ‘more for less’ strategy to position itself in the market. This strategy entails selling a product of a higher quality at a slightly lower price than that of competitors.

As aforementioned, the shop will focus on espresso coffee drinks to cut a unique market niche for itself. It will offer these drinks at slightly lower prices than that of Starbucks, which are usually $1-$3 higher than the industry average. Since the shop will specialize on espresso coffee drinks, marketing costs will not be high. The shop will depend on repeat customers and ‘referring’ business to increase its profit margins. Additionally, the specialization will cut down labor and operational costs. Thus, the shop will be able to sell top quality coffee at a lower price without incurring losses. The approach will also create the perception that customers get value for their money when they visit the shop.

Jain, S. (2009). Marketing: Planning and Strategy . New York: Cengage Learning.

Kotler, P., & Armstrong, G. (2014). Principles of Marketing . Upper Saddle River, NJ: Pearson Education.

Kotler, P., & Keller, K. (2011). Marketing Management . New York: Prentice Hall.

Our Heritage: Starbucks . (2010). Web.

Porter, S., & Claycomb, C. (1997). The influence of brand recognition on retail store image. Journal of Product and Brand Management, 6 (6) 197-207.

• Emirates Motor Company and Mercedes Benz Import
• UAE Businesses' Organisational Behaviour
• Use of Psychotropic Medications in the Treatment of Drug Abuse
• The Nissan and Starbucks Companies' Strategies
• Psychotropic Medication Effects on Human Behaviour
• New Belgium Brewery Company Expansion in Chile
• Business in the US Cosmetic Retailing Industry
• Enron Company: Governance and Strategic Purpose
• Walmart Company Organizational Design and Structure
• Integrated Marketing Strategies in Business
• Chicago (A-D)
• Chicago (N-B)

IvyPanda. (2020, July 1). Starbucks’ Market Segmentation. https://ivypanda.com/essays/starbuckss-segmentation-differentiation-positioning/

"Starbucks’ Market Segmentation." IvyPanda , 1 July 2020, ivypanda.com/essays/starbuckss-segmentation-differentiation-positioning/.

IvyPanda . (2020) 'Starbucks’ Market Segmentation'. 1 July.

IvyPanda . 2020. "Starbucks’ Market Segmentation." July 1, 2020. https://ivypanda.com/essays/starbuckss-segmentation-differentiation-positioning/.

1. IvyPanda . "Starbucks’ Market Segmentation." July 1, 2020. https://ivypanda.com/essays/starbuckss-segmentation-differentiation-positioning/.

Bibliography

IvyPanda . "Starbucks’ Market Segmentation." July 1, 2020. https://ivypanda.com/essays/starbuckss-segmentation-differentiation-positioning/.

Home — Essay Samples — Business — Ford Motor Company — Market Segmentation of Ford Motor Company

Market Segmentation of Ford Motor Company

• Categories: Ford Motor Company

About this sample

Words: 475 |

Published: Mar 8, 2024

Words: 475 | Page: 1 | 3 min read

Table of contents

Demographic segmentation, psychographic segmentation, geographic segmentation, behavioral segmentation.

Cite this Essay

Let us write you an essay from scratch

• 450+ experts on 30 subjects ready to help
• Custom essay delivered in as few as 3 hours

Get high-quality help

Prof. Kifaru

Verified writer

• Expert in: Business

+ 120 experts online

By clicking “Check Writers’ Offers”, you agree to our terms of service and privacy policy . We’ll occasionally send you promo and account related email

No need to pay just yet!

Related Essays

2 pages / 800 words

1 pages / 526 words

3 pages / 1457 words

1 pages / 652 words

Remember! This is just a sample.

You can get your custom paper by one of our expert writers.

121 writers online

Still can’t find what you need?

Browse our vast selection of original essay samples, each expertly formatted and styled

Related Essays on Ford Motor Company

When it comes to the debate over Chevy and Ford, it's a topic that has been ongoing for decades. Both of these automotive giants have a loyal following and have been producing vehicles for over a century. In this essay, we will [...]

It is as certain as the sun rising, it’s going to happen. Everyone is going to face death at some point, it’s only a matter of time. If you drove a sub-compact car designed by Ford during the early 1970s, it may come sooner than [...]

The concept of sustainability has emerged as a pivotal concern in contemporary discourse, reflecting a fundamental shift in human perspectives towards environmental stewardship. Historically, prior to the industrial revolution, [...]

The occupation of ergonomics in the manufacturing workplace and on the Assembly line flow is a unfavorable issues which needs to be addressed in order to the avoid workplace injuries and prevent work action which leads to long [...]

In 2001 the switch that caused many heart breaks and save some lives is still being talked about in 2018. General Motors brands had a defect on the ignition switch of several models one being the Cobalt. According to Consumer [...]

According to the online sources, BMW Group has around 13,000 suppliers located globally. BMW adds value on to its inbound logistic primary activity by the use of minimizing the costs of transportation and sourcing the raw [...]

Related Topics

By clicking “Send”, you agree to our Terms of service and Privacy statement . We will occasionally send you account related emails.

Where do you want us to send this sample?

By clicking “Continue”, you agree to our terms of service and privacy policy.

Be careful. This essay is not unique

This essay was donated by a student and is likely to have been used and submitted before

Download this Sample

Free samples may contain mistakes and not unique parts

Sorry, we could not paraphrase this essay. Our professional writers can rewrite it and get you a unique paper.

Please check your inbox.

We can write you a custom essay that will follow your exact instructions and meet the deadlines. Let's fix your grades together!

Get Your Personalized Essay in 3 Hours or Less!

We use cookies to personalyze your web-site experience. By continuing we’ll assume you board with our cookie policy .

• Instructions Followed To The Letter
• Deadlines Met At Every Stage
• Unique And Plagiarism Free

• Entertainment
• Environment
• Information Science and Technology
• Social Issues

Home Essay Samples Business Kellogg

Analysis of Kellogg's Marketing Strategy and Market Segmentation

Table of contents

Variables for identifying target market for kellogg’s, marketing mix for kellogg’s, main methods of market research.

• Company divide potential customers by country, region, city, islands, climate enable to reached more effectively with products.

Demographic

Psychographic.

• Divide customers by personality, values, opinions, lifestyle and interests that better match their needs.
• Divide people based on their attitudes, uses, loyalty status and occasion to retain more customers and achieve competitive production.

Online Survey /Questionnaire for Customer satisfaction

• Company can easily collect and analyse the results from online software.
• The respondent can be accessed through large geographical areas and countries.
• The survey should design carefully.
• Company may have limited number of questions can be asked online.

Product tests to reaction to a new product

• Company through customer feedback effectively improve product quality.
• Company know people how receptive to its product before launching the market.
• Different groups of people may have different opinion with the product test.
• It may cost long time.
• Aaker, D. A. (1996). Building strong brands. New York: Free Press.
• Kotler, P., & Armstrong, G. (2012). Principles of marketing. Upper Saddle River, NJ: Pearson Prentice Hall.
• Levy, M., & Weitz, B. A. (2012). Retailing management. New York: McGraw-Hill.
• McDonald, M., & Wilson, H. (2011). Marketing plans: How to prepare them, how to use them. Chichester, West Sussex: John Wiley & Sons.
• Kotler, P., & Keller, K. L. (2016). Marketing management. Harlow, England: Pearson.
• Homburg, C., & Kuester, S. (2013). Marketing management: A contemporary perspective. New York: McGraw-Hill.
• Meenaghan, T. (1995). The role of sponsorship in the marketing mix. International Journal of Advertising, 14(3), 223-248.
• Solomon, M. R. (2013). Consumer behavior: Buying, having, and being. Upper Saddle River, NJ: Prentice Hall.
• Shimp, T. A. (2010). Advertising, promotion, and other aspects of integrated marketing communications. Mason, OH: South-Western Cengage Learning.
• Czinkota, M. R., & Kotabe, M. (2014). Marketing management. London: Routledge.

*minimum deadline

Cite this Essay

To export a reference to this article please select a referencing style below

• Accountability
• Accounting Software
• Advertisement
• Advertising

Related Essays

Need writing help?

You can always rely on us no matter what type of paper you need

*No hidden charges

100% Unique Essays

Absolutely Confidential

Money Back Guarantee

By clicking “Send Essay”, you agree to our Terms of service and Privacy statement. We will occasionally send you account related emails

You can also get a UNIQUE essay on this or any other topic

Thank you! We’ll contact you as soon as possible.

Analysis on Marketing Segmentation of McDonald's

DOI: https://doi.org/10.1145/3436209.3436886 ICEBI 2020: 2020 The 4th International Conference on E-Business and Internet , Singapore, Singapore, October 2020

McDonald's is one of the most popular fast-food restaurants companies in the world. The way McDonald's built its marketing segmentation remains mysterious. Though there are multiple articles online discussing its marketing strategy, none of them clearly indicate the different approaches McDonald's utilized to build its marketing segmentation. In order to analyze McDonald's approaches to build marketing segmentation, seven different countries’ McDonald's websites are visited and the product types information from the official menu list on the websites are extracted. These seven countries represent seven continents while Antarctica is not considered. India and China are chosen since they are the most populated countries on the Earth. Then, every approach that McDonald's using in building marketing segmentation is listed out and how these approaches contribute to the overall structure is analyzed. The approaches all have advantages and drawbacks at the same time. Meanwhile, the five-year total return rates indicate that McDonald's has won its customers’ hearts in these several years.

ACM Reference Format: Jing An. 2020. Analysis on Marketing Segmentation of McDonald's. In 2020 The 4th International Conference on E-Business and Internet (ICEBI 2020), October 09-11, 2020, Singapore, Singapore . ACM, New York, NY, USA, 4 pages. https://doi.org/10.1145/3436209.3436886

1 Introduction

McDonald's is one of the most popular restaurant chains in the world. Nowadays, there are more than 40000 McDonald's restaurants globally which serve tens of millions of customers every day [ 2 ]. The question becomes what did McDonald's do in order to make sure its customers stuck on McDonald's products. The difficult part is that each of the customers has a different profile. The profile could include elements as broad as nationality and elements that are much more specific such as preference of meat. To satisfy all these needs, it's crucial to know about customers and build a marketing segmentation so that the other departments could start advertising and branding accordingly. Indeed, McDonald's marketing team does a lot of work behind and one of its jobs is to build customer segmentation in order to know their customers better and target new potential customers. In the following text, the goal is to explore what approaches do McDonald's use to build marketing segmentation.

2 Methodology

2.1 data collection.

McDonald's is a giant international fast-food company. Aside from its operation in the U.S, McDonald's also operates in another 117 countries across the world [ 1 ]. In addition, these 118 countries in total cover all seven continents. Since the goal is to explore all approaches used by McDonald's to build its marketing segmentation and geographic approach is one of its components. It's necessary to pick countries that represent its continents. The menu information would be extracted from each country's McDonald's website. It's logically sound to select countries that have the most population in its continents. Thus, the following countries were selected which are the U.S, China, India, Brazil, Egypt, Australia and Germany. The reason that Egypt is chosen instead of the two other countries with more population is that those two countries do not have McDonald's operation as for now. Meanwhile, China and India are selected together because they are two of the most populated countries in the world and they have almost identical populations as now. Last but not least, Russia does not have an official McDonald's site which makes the data collection impossible. In this case, Russia was replaced with Germany which are on the second place with most population in Europe.

2.2 Geographic Approach

McDonald's is an international fast-food chain. In this case, it not only has restaurants in the U.S, but also in other countries. People living in different countries have very different eating habits and cultural backgrounds. Therefore, McDonald's must segment different regions correctly in order to keep its dominance in the globe. In Table 1 , region and density are the two major criteria McDonald's take into account. Under the region criteria, it indicates whether the region is domestic or international is the first parameter McDonald's takes into account. McDonald's developed further strategies to perfect its marketing segmentation plan. In fact, McDonald's menus differ all over the world. As a result of different preferences on the meat kind, McDonald's adjusts its menu accordingly in different countries.

Table 2 displays the distribution of McDonald's flagship product(burgers) on the menu in different regions around the world. It's clear that McDonald's does not keep the same menu for different countries. All of them showed some differences compared to other countries. One of the countries that stand out is India. Due to factors like religious beliefs and local customs, a lot of Indians view cattle as a holy symbol. Thus, beef is not welcome in Indian culture. McDonald's took beef products entirely from the menu not only to ensure its profit but also to respect the local culture in a sense. Another country that stands out in this table is Egypt. McDonald's Egypt provides most burger products among these seven countries. The locals seem to have a split preference on different meat kinds. Thus, McDonald's simply offered Egyptians tons of choices to select from their desire. In addition, the fact that China and India are neighboring countries but having two drastically different menus indicates that geographic approach is highly crucial. Another example in this case is that McDonald's Japan sell TeriTama Burger in springtime and Tsukimi Burger in Autumn. Both of these burgers are for sale in limited time and designed to celebrate cherry blossom season and harvest moon festivals respectively [ 6 ]. This illustrates how McDonald's segment different regions based on cultural backgrounds.

Another aspect that fits in the geographic approach is the density of a certain area. Those McDonald's in the urban area have a greater chance of testing new products whereas those in rural areas may have a more conservative menu. This was driven by the fact that there are more people visiting the ones in urban areas. Thus, it's more logical for McDonald's to spend on advertisements and coupons in these urban locations about their products.

2.3 Demographic Approach

Table 3 illustrates McDonald's demographic approach including age, gender, life-cycle stage occupation, religious belief, and so on. In terms of age, McDonald's segments them into a variety of different groups. As for the young kid, McDonald's designed a special meal for them which is called “Happy Meal”. There are three different setups in the U.S market. Meanwhile, they all consist of little fries and milk which are products that are designed for young kids. Oftentimes, there will be toys included in these meals. Though people in other age groups may don't value them enough, its effect on young kids is huge. As for the teenager group who are mostly students, McDonald has not only priced their products aggressively to retain these group of people who are sensitive about the price, but also provide amenities such as Wi-Fi to attract students [ 5 ]. As for the grown-up, McDonald's offers them coffee products which cannot be compared to a conventional coffee shop. These designs clearly target customers who belong to different age groups. As for other segment criteria, McDonald's would create a framework that address all these characteristics.

2.4 Behavioral Approach

In terms of Behavioral Approach, it plays a significant role within McDonald's segmentation system. In Table 4 , it's clear that McDonald's segmentation builder includes the degree of loyalty to the restaurant and Benefits sought. The research from McDonald's UK indicates that 36% of consumers eat McDonald's food because of its value. This 36% of respondents buy McDonald's food because they believe McDonald's products bring them great cost benefits [ 1 ]. In addition, these consumers feel like McDonald's not only provides cheaper prices for its hamburgers, fries, and drinks compared to other fast-food chains, the food portion is also very ideal compared to their competitors. For instance, 20 pieces of chicken nuggets are only a little bit over six dollars which are a dollar more compared to 10 pieces of chicken nuggets. However, McDonald's realize there are other customers who value time efficiency more than the cost benefits. These groups of people may care less about how much they saved from each McDonald's meal, but care more about having a meal which can provide enough energy calories in a certain amount of time. McDonald's, therefore, comes up with different services to satisfy those customers’ needs. While Drive-thru has been implemented by McDonald's since the 1960s, McDonald's developed this McDonald app order feature in 2013. Customers just need to order products they want from their mobile apps in advance. Then, they simply need to drive up to the curb of a McDonald's restaurant and scan a code. McDonald's staff would automatically bring their food outside to their cars. This would save the customer from waiting in the line inside the restaurant and lower the burden on the kitchen during rush hour quite a bit.

Meanwhile, another aspect in the behavioral approach is the degree of loyalty. The distinction is quite obvious. There are those “hardcore loyals” and those “switchers” eat McDonald's occasionally according to Table 4 . In this case, figuring out how to retain its customers became the key. In early 2017, McDonald's launched a reward program in its mobile app [ 3 ]. The program would record previous transactions and apply the credit to a future transaction. Apparently, McDonald's competitor Taco Bell had launched a program similar to McDonald's program and received a considerable amount of growth because of its program. Though McDonald's is late in the game, McDonald's reward program would still potentially lock down those “switchers”, especially those who are sensitive to a price change.

2.5 Psychographic Approach

The psychographic approach can be hard to describe. In Table 5 , it indicates that McDonald's mainly values customers' patterns of work and leisure and their lifestyle through the psychographic approach. For instance, customers who come into an urban location between 12 pm to 6 pm indicates that they are the working class who may simply try to grab lunch or dinner. For those who come in between 6om to 12 am are mostly evening and night shift staff, working in various shops nearby McDonald's stores. Therefore during their breaks and when they finish their job, normally visit McDonald's. The last group between 12 am to 12 pm, they are mostly the working class again who has to start their work early. Interestingly, this group has proved to be a constant customer. Another reason that explains why the Psychographic approach could be so hard to describe is how it links to the other approach. For instance, similarities between the behavioral approach and psychographic approach can be drawn when it comes to lifestyle. Customers who have a busy lifestyle would value time efficiency as well. Furthermore, the table under the geographical approach indicates there are countries that have vegetable burgers on their menus. This would indicates there is a certain customer base who potentially live in a vegetarian lifestyle. Thus, certain approaches could not be discussed individually.

3 Discussion

The reason that McDonald's has to utilize so many different approaches to build marketing segmentation is due to its enormous scale. To accommodate so many consumers, it may have to come down to each individual region management team to conduct marketing segmentation. In this case, a different approach has its own advantages and disadvantages. As for the geographical approach and demographic approach, their advantage is similar to that of researchers who can get a large amount of data to build up the frame. On the contrary, while geographic regions do not guarantee a homogenous preference which could mislead the research, the demographic approach can be too broad for executives to make decisions. Meanwhile, the other two approaches would offer decision-makers vivid images to implement policies based on Customers’ complex lifestyles and sought. However, they could be sometimes very vague and hard to implement in a lot of cases. Nevertheless, these four approaches seemed to work for McDonald's favor according to Figure 1 . From 2014 to 2019, while the total return for both the S&P 500 and Dow Jones Industrials failed to reach the 200 $ mark, the total return for McDonald's was within a hair of the 250 $ mark. It is clear that McDonald's five-year total return outruns the market, which exemplifies the marketing segmentation implemented by McDonald's is a success.

Figure 1. McDonald's Five-Year total return comparison [2]

4 Conclusion

The four different approaches used by McDonald's to build its marketing segmentation has been proved. Though each of them is only able to contribute a limited amount of impact, utilizing them efficiently could lead to great marketing strategies. Meanwhile, these four marketing segmentation approaches could be used in a variety of other consumer products industry. At the end of the day, getting to know customers better would help any enterprise to develop a better business plan and these approaches here are the key elements that support the research.

ACKNOWLEDGEMENT

I would like to say thank you to Professor Stephen Coggeshall who helped me develop my business analytic skills as well as offering me guidance on constructing this paper. It has been an honor to work with Professor Coggeshall.

• Customer retention at McDonalds. UKEssays. ukessays.com, November 2018. Web. 13 August 2020.
• McDonald's. 2019 annual report, February 26, 2020. corporate.McDonalds.web. Aug 13, 2020
• Samuely, Alex. McDonald's Loyalty Strategy Matures beyond Mobile Coupon Enticement. Retail Dive, 2017, www.retaildive.com/ex/mobilecommercedaily/how-mcdonalds-loyalty-strategy-is-maturing-beyond-mobile-coupon-enticement.
• McDonald's Menu: Our Full McDonald's Food Menu: McDonald's. www.mcdonalds.com/us/en-us/full menu.html. 2020
• The concept of segmentation and its process. 11 2018. UKEssays.https://www.ukessays.com/essays/marketing/the-concept-of-segmentation-and-its-process-marketing-essay.php?vref=1.
• Keenan, Michael. Geographic Segmentation: What It Is and Why You Need It. ManyChat Blog, 3 Aug. 2020, manychat.com/blog/geographic-segmentation/. 

Permission to make digital or hard copies of all or part of this work for personal or classroom use is granted without fee provided that copies are not made or distributed for profit or commercial advantage and that copies bear this notice and the full citation on the first page. Copyrights for components of this work owned by others than ACM must be honored. Abstracting with credit is permitted. To copy otherwise, or republish, to post on servers or to redistribute to lists, requires prior specific permission and/or a fee. Request permissions from [email protected] .

ICEBI 2020, October 09–11, 2020, Singapore, Singapore

© 2020 Association for Computing Machinery. ACM ISBN 978-1-4503-8857-3/20/10…$15.00. DOI: https://doi.org/10.1145/3436209.3436886

Pardon Our Interruption

As you were browsing something about your browser made us think you were a bot. There are a few reasons this might happen:

• You've disabled JavaScript in your web browser.
• You're a power user moving through this website with super-human speed.
• You've disabled cookies in your web browser.
• A third-party browser plugin, such as Ghostery or NoScript, is preventing JavaScript from running. Additional information is available in this support article .

To regain access, please make sure that cookies and JavaScript are enabled before reloading the page.