A product market is comprised of groups of customers who have a very specific need, with fewer offerings to choose from. For example: The Luxury Car market fulfils a specific need and has only a few options to choose from: Bentley, Aston Martin, Ferrari, etc. Product market segments are similar within the specific segment (ex. Luxury Cars), and are different across segments (ex. Luxury, Mid-size, Economy); and each segment has very specific characteristics, which, when reflected in the product, can return higher profits to the organization.
Markets can be segmented by defining the goals of the customers in that market subset. For example, in the transportation market(The Generic Market), a group of customers who's goals of transportation are to be able to travel in their own vehicle, feel comfortable/safe/fast relative to other transport options, and be able to show other people how "nice" their own vehicle is: this subset can be said to have goals which define them as a Luxury Car segment.