One of the first, and most important steps in creating a business model is deciding on your target market. There are variety of customer segments to choose from such as mass market, niche market, segmented diversified, and multi-sided platforms. Some basic ways to segment a market are in regards to socio-demographics (gender, age, location, income) and psychographics (attitudes, values, lifestyles). Deciding your customer segment is an essential step in shaping the rest of your company, from design, to partnerships, to marketing: it is all heavily dependent on your target market. Choosing a specific market allows greater focus on a group, allowing your firm to better suit it’s goods and services to the market, however it can also be limiting. BMW motorcycles are known to be geared towards older men. Although BMW has been very successful in this market, it limited a younger demographic from entering the market. However, recently the company unleashed the R nineT, a motorcycle designed for a younger demographic. This creates a larger segmented market for BMW. This new, sleek and stylish design will entice new customers into the market for BMW motorcycles allowing the company to grow and increase profit.
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