Needless to say, segmenting is one of the core principles of marketing. You will find a number of questions on the topic, just to make sure you understand everything. The concepts are explained in Chapter 3. Did you hesitate between a) and c)?

10.   Segmenting

a)    is essentially a disaggregating or "break it down" process.
Well, yes it is a disaggregating process in a way, but not essentially.

b)    assumes that all customers can be grouped into homogeneous and profitable market segments.
That would be true in a perfect world. We're not quite there yet.

c)    tries to aggregate together individuals who have similar needs and characteristics.
This is the right answer: after having performed some type of disaggregating, the segments are determined according to individuals' needs and you have to have similar needs and characteristics - for that product.

d)    usually results in firms aiming at smaller and less profitable markets.
Smaller, yes, less profitable, well, that wouldn't help, would it?

e)    assumes that each individual should be treated as a separate target market.
Of course not, that is taking things a bit too far.

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