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"Dividing a market into smaller segments of buyers with distinct needs, characteristics, or behaviours that might require separate marketing strategies or mixes" is termed as?

1. Types of Market Segmentation:

   • Demographic Segmentation: Based on factors like age, gender, income, education, etc.
   • Psychographic Segmentation: Based on lifestyle, values, or personality traits.
   • Geographic Segmentation: Divides markets based on location, such as region, city, or climate.
   • Behavioral Segmentation: Based on buying behaviours, usage rates, or benefits sought.

2. Importance of Market Segmentation:

   • Helps businesses identify their target audience.
   • Enables the creation of customized marketing strategies.
   • Increases efficiency in resource allocation.
   • Enhances customer satisfaction by addressing specific needs.

Additional Knowledge:

• Option a (Market Targeting):
  After segmentation, businesses choose specific segments to focus on, which is called market targeting. Targeting involves selecting the most viable and profitable segments.

• Option c (Market Differentiation):
  Differentiation refers to creating unique offerings to stand out in the market. It focuses on how a product/service is distinct from competitors.

• Option d (Market Positioning):
  Positioning refers to crafting a distinct image or identity for a product in the minds of the target customers. It highlights the unique benefits and value the product delivers.

Market segmentation is the first and critical step in crafting an effective marketing strategy, ensuring businesses understand and meet the specific needs of their diverse customer base.