I use them both, but for very different purposes.
Segmentation works best when your content needs to be very different, as in segmenting results from your last mailing into opened, opened and clicked, and did not open. I would send each of these three groups a very different follow-up letter.
Personalization works best when you want to tweak a standard email by giving your prospect relevant information. If you know something about your customer such as age range or gender, you can increase the odds that you are offering them an appropriate product or service.