Answer / dearvkmehta

Broadly there are three reasons:

1. A company has too little resources for it serve the
entire market. So it makes sense to select sufficient few
out of this entire and large market.

2. Different customers have different needs and different
levels of benefits out of the same product served by the
company. Segmentation helps company identify cutomers with
highest benefits out of the same product as compared to
other customers. It is more economical and productive for a
company to satisfy and retain these customers.

3. Segmentation helps company to select Homogeneous groups
of customers out of the heterogeneous market. Homogeneity of
customers helps company to anticipate similar response
behavior from these group of customers for its single
marketing strategy.

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