Market Segmentation
Definition of "Market segmentation"
The term market segmentation is mostly used in marketing for assembling prospective buyers in groups based on their needs and their response to a marketing action. One definition of market segmentation is the market’s division into subsets of customers to simplify targeted branding and marketing strategies. When you know who you are trying to attract, you know what they are interested in, it’s easier to approach them.
What is Market Segmentation in Real Estate?
Real estate market segmentation allows real estate companies, investors, and brokers to target specific groups of buyers who would get the biggest benefit from a type of property. The purpose of market segmentation in real estate is to identify and target specific groups of buyers to offer them real estate that was tailored or branded precisely for their needs.
Market segmentation for real estate can be done based on different factors like the type of property (residential or commercial), demographics (millennials or baby boomers), geographical location (one city or state versus another). Based on the type of market segmentation applied and the reason for which it was applied, it can be used in different ways.
Examples of Real Estate Market Segmentation
Real estate agents use market segmentation to find their niche based on the types of buyers or sellers. They can also use it to improve their business depending on the client they work with, the buyer or the seller. Applying market segmentation to their strategy helps them improve their brand and communication towards their targeted audience.
Investors and real estate developers look at market segmentation to evaluate performances. For instance, during economic strife, some segments of the market might be more profitable than others. The commercial real estate market might not be as affected by an economic downturn as the residential market. Similarly, the rental market might drop while the homeowners market skyrockets. In some cities, single-family homes might be more profitable than high-rise apartment complexes or vice versa. Being able to determine this through market segmentation helps investors and developers supply a growing demand while also increasing their revenue.
Popular Real Estate Terms
Document issued by a governmental agency permitting the recipient to do something. An example is a building permit to construct a structure. ...
Shingles having uniform length, but random width. Random shingles give a creative appearance to a roof. ...
Buyer who is acting in good faith, is not aware of any outstanding claims or rights of others to the property, and has given valuable consideration as part of the business transaction. ...
An agreement by which the owner of property (the lender) and a borrower agree to let the borrower use the property for a particular time period and in return the borrower will pay the ...
A lender can be a private individual, a private or public group, or an institution that loans funds to a person or business that the lendee would later repay with interest in most cases. In ...
Generally speaking, indemnity defines a legal principle and an ensuing agreement to calculate the amount of compensation a party is entitled to resulting from a specific financial loss they ...
Total expenditure to modernize a building to meet the owner's or tenant's needs. ...
The right to deviate from the use of land prescribed by an existing zoning ordinance. ...
The definition of the term right of way is an easement or the right of another person to pass over land owned by someone else to reach a particular destination. An individual is typically ...
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