Segmentation - is the process of dividing the population into distinct and logical subsets or segments for ease of analysis. As each segment is homogeneous, the observations in a subset are likely to behave in the same way or have similar features. Segmentation is commonly used for customers, markets and large data sets.
An application oriented question on the topic along with responses can be seen below. The best answer was provided by Mohan PB on 16th November 2017.