Dividing a market into segments based on the various ways to use a product is known as:

• A. Demographic segmentation
• B. Geographic segmentation
• C. Usage-based segmentation
• D. Psychographic segmentation

Answer: (C)

Verified step by step guidance

1. Understand that market segmentation is the process of dividing a broad consumer or business market into sub-groups of consumers based on some type of shared characteristics.
2. Recognize the common types of market segmentation: demographic (age, gender, income), geographic (location), psychographic (lifestyle, values), and usage-based segmentation.
3. Identify that usage-based segmentation divides the market based on how consumers use a product, such as frequency, quantity, or purpose of use.
4. Match the definition given in the problem — dividing a market based on the various ways to use a product — with the correct segmentation type, which is usage-based segmentation.
5. Conclude that the correct term for dividing a market by product usage is usage-based segmentation, differentiating it from demographic, geographic, and psychographic segmentation.