Syllabus: OCR - GCSE Business
Module: 2. Marketing
Lesson: 2.3 Market Segmentation

Introduction

This article supports the delivery of OCR GCSE Business – 2. Marketing – 2.3 Market Segmentation. It is aligned with the official OCR syllabus and is designed for teachers, SLT, careers leads, and headteachers looking to embed real-world relevance and assessment precision into Business lessons. The topic sits within the wider marketing unit, helping learners understand how and why businesses divide their market to target specific groups. It also serves as a foundation for later topics such as the marketing mix and product positioning.

Market segmentation brings the curriculum to life by prompting students to think like business decision-makers — weighing consumer needs, competition, and commercial strategy.

Key Concepts

OCR GCSE Business requires students to understand and apply the following under 2.3 Market Segmentation:

• Definition: Understanding what market segmentation is — dividing the market into distinct groups of buyers with different needs or behaviours.

• Bases of segmentation:

  • Demographic (e.g. age, gender, income)

  • Geographic (e.g. location, climate)

  • Psychographic (e.g. lifestyle, values)

  • Behavioural (e.g. purchasing habits, brand loyalty)

• Benefits to business:

  • Enables targeted marketing

  • Better alignment of products to customer needs

  • More efficient use of resources

• Drawbacks:

  • Risk of overlooking potential customers

  • Higher marketing costs for personalised campaigns

• Application: Students should be able to analyse how different businesses apply segmentation and explain why it’s useful in competitive environments.

Real-World Relevance

Segmentation isn’t just textbook theory — it’s how businesses survive and grow. Here are practical examples students will recognise:

• Spotify uses behavioural segmentation by offering curated playlists based on listening habits and moods.

• McDonald’s adapts its menu by geography — you’ll find a McSpicy Paneer Burger in India and a Teriyaki Burger in Japan.

• Gymshark, a UK-based fitness apparel brand, targets Gen Z and Millennials using psychographic segmentation through lifestyle branding on platforms like TikTok and Instagram.

These cases help students connect classroom theory to what they see in everyday life — deepening understanding and encouraging active thinking.

How It’s Assessed

OCR uses a range of command words in this topic, and it’s vital students understand how to respond accordingly:

• Explain: Define a concept and support it with an example. E.g. “Explain one benefit of market segmentation to a business.”

• Analyse: Use a logical chain of reasoning. E.g. “Analyse how segmenting a market can help a business increase its profits.”

• Evaluate: Weigh up arguments and reach a supported judgement. E.g. “Evaluate the extent to which market segmentation is essential for a small business.”

Assessment is typically through structured questions, often linked to short case studies. Students should practise applying segmentation concepts to real or fictional businesses, justifying their decisions.

Enterprise Skills Integration

Market segmentation is fertile ground for developing core enterprise skills:

• Problem-solving: Determining which segment to target based on limited data or budget.

• Decision-making: Justifying the best segmentation strategy given business aims.

• Strategic thinking: Linking segmentation choices to long-term goals like brand growth or product development.

Enterprise Skills’ Business Simulations plug directly into this topic. In one scenario, students must choose a target market for a new product launch, balancing cost, competition, and customer appeal. It’s real decision-making under pressure — just like in business.

Careers Links

Teaching market segmentation also opens the door to key careers insights — directly supporting Gatsby Benchmarks 4, 5 and 6:

• Marketing executive – segmentation underpins every campaign strategy.

• Product manager – understanding your audience shapes the product pipeline.

• Market researcher – gathering and analysing data to inform segmentation.

• Advertising and PR roles – creating messages tailored to specific audiences.

These connections can be reinforced through activities like employer Q&As, using alumni case studies, or job role profiles during lessons.

Teaching Notes

Common pitfalls to watch for:

• Students confusing types of segmentation (e.g. mixing demographic and psychographic).

• Over-generalised examples (e.g. “teenagers like video games” – push for nuance).

• Failing to justify why a segment is attractive for a specific product.

Tips for strong delivery:

• Use relatable examples like Netflix, Nike, or Greggs.

• Try a class activity where students must segment their classmates and pitch a product.

• Use data — real or fictional — to bring decision-making into the mix.

Extension activities:

• Run a mini case challenge using Enterprise Skills’ Skills Hub tools — students compare marketing strategies for two different segments.

• Create a cross-curricular link with Geography (population distribution, consumer trends).