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Learning objective

Explain why businesses segment by gender, age, location and income.

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Topic

Segmentation

Subtopic

Types and use of segmentation

Aqa Gcse BusinessMarketing

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Quick explanation

Explain why businesses segment by gender, age, location and income

  • This point belongs to Segmentation, especially Types and use of segmentation.
  • You need to be able to explain why businesses segment by gender, age, location and income.
  • The key ideas to know are age, location, and gender.
  • Use the linked flashcards and practice questions to check recall, then practise applying the idea in an exam-style answer.

Key concepts

agelocationgenderincome

Why it matters

This objective helps connect Types and use of segmentation to exam-style questions, flashcards, and revision notes for Segmentation.

Quick student answer

Explain how a small manufacturer might use income segmentation to decide on a pricing strategy for a new product.

Direct answer

A small manufacturer could identify high‑income and low‑income customer groups. For the high‑income segment, it might set a premium price and emphasise quality and exclusivity, while for the low‑income segment it could offer a lower‑priced version or a payment plan to increase affordability and market share.

How it works

Income segmentation informs price sensitivity: higher‑income customers are less price‑sensitive and value premium features, whereas lower‑income customers prioritize cost, so a differentiated pricing strategy targets each group’s willingness to pay.

Key terms

  • Target market: The specific group of consumers a business aims to reach with its products or services.

Common trap

Treating a segment as a homogeneous group: Recognise intra‑segment variation and consider sub‑segmentation or individual differences.

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