A market segment is a specific group of potential customers within a larger market who share similar characteristics, needs, or behaviors. Businesses identify these segments to tailor their products, services, and marketing strategies effectively. By understanding the unique preferences of each segment, companies can better meet customer demands and enhance satisfaction. Market segments can be defined by various criteria, including demographics, psychographics, geographic location, and buying behavior. For example, a company selling sports equipment might target segments like young athletes or fitness enthusiasts to create focused marketing campaigns that resonate with each group's interests and lifestyles.