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What limitation is noted for demographic segmentation?
AIt is far more costly than any other form of segmenting
BIt is limited in what it can reveal about the consumers
CIt cannot be applied to business markets in any way
DIt requires the firm to run its own survey research
Answer & Solution
Correct answer: B. It is limited in what it can reveal about the consumers
1. Demographic information is easier to obtain than other kinds of information.
2. Even so it may not always be the best approach to segmentation.
3. The reason is that it is limited in what it can reveal about consumers.
4. Demographics provide the skeleton while psychographics add the detail.
5. Its ease of collection rules out the claim that it is the most costly form.
6. Business markets do use demographic style variables such as client size, so the third option is false.
_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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