Market segmentation helps marketers _______.

• A. increase the overall supply of goods in the market
• B. eliminate competition from other firms
• C. set prices based solely on production costs
• D. identify and target specific groups of consumers with tailored marketing strategies

Answer: (D)

Verified step by step guidance

1. Understand the concept of market segmentation: it involves dividing a broad consumer or business market into sub-groups of consumers based on shared characteristics such as demographics, preferences, or behaviors.
2. Recognize that the purpose of market segmentation is to allow firms to focus their marketing efforts more effectively by tailoring products, services, and marketing messages to the specific needs and desires of each segment.
3. Analyze why the other options are incorrect: increasing overall supply relates to production decisions, eliminating competition is not feasible through segmentation alone, and setting prices solely on production costs ignores consumer preferences and willingness to pay.
4. Conclude that market segmentation helps marketers identify and target specific groups of consumers with tailored marketing strategies, improving the efficiency and effectiveness of marketing campaigns.
5. Summarize that this targeted approach can lead to better customer satisfaction, higher sales, and competitive advantage.