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Why do companies cut a market into segments rather than serving the whole of it?
ABecause the law limits how many buyers a firm may serve
BBecause a mix for every part of the market would cost too much
CBecause one marketing mix works equally well for all buyers
DBecause segments always contain exactly the same number of buyers
Answer & Solution
Correct answer: B. Because a mix for every part of the market would cost too much
1. Each part of the market a firm targets needs its own set of five Ps.
2. Building a marketing mix for every part of the target market would be very expensive.
3. So companies cut the target into segments they are best positioned to win.
4. Segmentation also differs depending on whether the market is a consumer or a business market.
5. No law caps how many buyers a firm may serve, so the first option is invented.
6. One mix does not fit all buyers, and segments are not equal in size.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 11 "Creating Products and Pricing Strategies to Meet Customers' Needs", section 11.5 Market Segmentation_
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