Question

The first step in selecting a target market is to study the industry in which the firm intends to compete and determine the different potential target markets in that industry. This process is called:

A) market positioning
B) market splitting
C) market targeting
D) market subdividing
E) market segmentation

Answer 1

Letter E is correct. Market segmentation.

Step-by-step explanation:

Market segmentation is an effective marketing tool in identifying the target audience. In this process, the potential customers market is divided into groups according to individual characteristics and similarities in preferences, interests, needs, location and others. Segmentation is also performed according to the response to the marketing strategies used.

There are several added benefits for an organization that uses market segmentation, such as the ability to customize marketing campaigns according to the characteristics of each group, reducing costs, time and risks.