Explanation:

Psychographic segmentation is defined as a market segmentation technique where groups are formed according to psychological traits that influence consumption habits drawn from people’s lifestyle and preferences. It is mainly conducted on the basis of “how” people think and “what” do they aspire their life to be.

Any organization which intends to understand their consumers’ thought process can divide their target market according to this segmentation method. Psychographic market segmentation is one of the most effective segmentation methods other than demographic segmentation, geographic segmentation, and behavioral segmentation.