Location and lifestyle segmentation

Location segmentation groups customers by where they live or work. The area can be local or national: a family bakery may aim at people in its own town, while an online model-kit shop serves customers across the country. It can also be urban or rural: a city-centre repair shop may rely on customers travelling a short distance, while a rural customer may need home delivery or a mobile service. Climate is another location factor because it affects demand. In a wet climate, waterproof coats and umbrellas are in greater demand; in a dry one, garden sprinklers sell better. Location segmentation uses geography as the base, not a customer's age or income.

Lifestyle segmentation

Lifestyle segmentation groups customers by their interests, hobbies, values or way of life. For example, a pottery painting studio may aim at keen crafters and promote through weekend workshops, while a vegan recipe box service may aim at customers who value animal welfare. Other lifestyle groups include keen gardeners, board-game players and volunteers.

Lifestyle is not the same as age or income. Two 30-year-olds on the same income could have very different lifestyles: one might spend free time training for a fun run and the other decorating celebration cakes. A product that suits one may not suit the other, so a business that groups customers by lifestyle can choose products and promotions that fit their interests rather than guessing from age or income alone.