Businesses need to know what types of people buy the goods/sevices they produce.  Companies try to identify different market segments.  A market segment is a part of a market that contains a group of buyers with similar characteristics.  If a company knows what market segment it's customers are in, it can target adverts or new products specifically at them.  

Very simple method of segmenting the market
Further Reading

Australian Tourist Board - Targeting a market segment
Market segmentation case study - Newspapers
Cadbury: Identifying the market