Which term describes the process of identifying and targeting specific groups within a larger market?

The process of identifying and targeting specific groups within a larger market is known as market segmentation. This strategy involves dividing a broad consumer or business market into sub-groups of consumers based on shared characteristics such as demographics, needs, priorities, or other distinguishing factors.

Market segmentation is essential because it allows businesses to tailor their products, services, and marketing efforts to meet the unique needs of different customer segments, thereby increasing the efficiency of their marketing strategies and improving customer satisfaction. By targeting specific groups, companies can optimize their resources and enhance their overall competitive advantage in the marketplace.

The other terms, while related to marketing strategies, focus on different aspects. Market penetration involves increasing market share for existing products in current markets, market positioning refers to how a brand is perceived relative to competitors in the minds of consumers, and market expansion entails entering new markets or expanding into new sectors with existing products or services. These concepts support overall marketing strategies but do not specifically define the process of identifying and targeting distinct market segments.