Customer Segment
What is a customer segment?
A customer segment is a distinct group of customers or users who share similar characteristics—such as demographics, role, industry, or behavior—and have common needs. Customer segments help teams be more specific about who they're creating value for and ensure discovery efforts focus on the right people.
Customer segments are a core component of the Business Model Canvas, sitting alongside value propositions and customer channels. When thinking through your business model, you identify customer segments, define value propositions for each, and determine how you'll reach them.
When should teams differentiate customer segments?
Sometimes it's perfectly acceptable to work with the broad category of "customers." If your customers' needs are consistent regardless of demographic, geographic location, industry, size, role, or experience level, you can probably conduct customer interviews with a variety of customers and learn something valuable each time.
But in other cases, you'll need to dive deeper into customer segments. Segments warrant explicit representation when two conditions are true: each segment can impact your desired outcome, and their needs are materially different from each other.
For example, if dentists use your software differently from physicians who use it differently from urgent care centers, and each segment has the potential to drive your outcome with very little overlap in their needs, you should treat them as distinct segments.
Why do customer segments matter in discovery?
Being customer-centric requires knowing who those customers are specifically. When customers' needs vary significantly across different groups, teams need to be more intentional about who they interview and learn from.
Customer segments directly influence which opportunities you prioritize and which solutions you pursue. The same product might deliver different value propositions to different segments, making segment clarity essential for both discovery and business viability.
Learn more:
- Representing Customer Segments on Your Opportunity Solution Tree (Hope’s Take)
- Representing Customer Segments on Your Opportunity Solution Tree (Teresa’s Take)
- Product Discovery Basics: Everything You Need to Know
Related terms:
- Customer Interview
- Opportunity
- Opportunity Solution Tree
Last Updated: October 25, 2025