In general, markets are too complex and customers too heterogeneous for a vendor to meet all demands equally well and in a profitable way. This necessarily leads to market segmentation - i.e., a division of the heterogeneous market as a whole into homogeneous segments - and the selection of relevant target groups.

Apart from verifying existing customer segments, this type of analyses serves to identify segments where new opportunities are emerging from vertical or segment-specific solutions. What segments are to be targetted by which solutions and marketing measures in order to achieve a certain turnover (which itself needs to be figured out as well)? These are key questions to be investigated within the scope of a basic assessment of a product/service portfolio, especially within the context of launching new products.

The above is closely related market potentials analyses, which aim to measure the market potentials of new or already established products in market segments defined beforehand. That way, market trends will be revealed, and promising market segments identified for the customer.

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