University Name: Business Model Report on Customer Segmentation

This report delves into the critical role of customer segmentation within a business model, focusing on a specific demographic (18-30 years old). It examines how businesses can leverage customer segmentation to tailor marketing strategies and optimize resource allocation, particularly emphasizing the significance of understanding customer needs and preferences. The report explores value-based market segmentation, illustrating how businesses can determine profitability, adjust marketing budgets, and enhance customer experiences. Furthermore, it highlights the importance of the business model canvas, value proposition canvas, marketing strategies, financial viability, and potential legal considerations. The report offers an in-depth analysis of how customer segmentation contributes to long-term business success by creating value, increasing customer base, and improving profitability.

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Integrated Business Perspective- Customer Segmentation
The business model canvas has many facets which includes, partners, revenue streams.
Channels, value propositions and customers segments. However, customer segments is
crucial for any integrated business model. There is no secret that some customers are
profitable than others. The demographic criteria in this business is between the ages of 18 and
30. It seems to focus on the young (Schlittgen, Ringle, Sarstedt, and Becker, 2016). The
importance of customer segments in a business model canvas is;
1. It allows the business to reach to a particular and specific customer group with
specific wants and needs.
2. The business (UTC) is able to make better strategies in marketing and use its
corporate resources to make decisions in the long run.
3. Segmenting means positioning the product or service to the ages of 18-30 who have
more characteristics in common.
4. It increases the chance of increasing the customer base targeted and therefore more
sales from that segment.
Segmentation in delivering value
To be profitable in the long-run, a business has to have a clear knowledge and
understanding of how customer segmentation correlate with profitability. Value is added in
the satisfaction of customers through their experiences. Value based market segmentation
evaluates segments on basis of costs and revenue generation and relationship maintenance
(Teece, 2018). The company can be able to determine the segments that are least and most
profitable. As a result, they are able to adjust the budgets in the marketing department

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accordingly. The primary reason for segmentation is the fragmentation of customer value.
Value can be added by producing the products and services that the segment group requires.

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References
Schlittgen, R., Ringle, C.M., Sarstedt, M. and Becker, J.M., 2016. Segmentation of PLS path
models by iterative reweighted regressions. Journal of Business Research, 69(10), pp.4583-
4592.
Teece, D.J., 2018. Business models and dynamic capabilities. Long Range Planning, 51(1),
pp.40-49.

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