Casualty Actuarial Society (CAS) Practice Exam

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Which of the following is NOT a common type of market segmentation?

  1. Behavioristic segmentation

  2. Commutative segmentation

  3. Geographic segmentation

  4. Demographic segmentation

The correct answer is: Commutative segmentation

Behavioristic segmentation, geographic segmentation, and demographic segmentation are well-established methods of dividing a market into different segments based on specific criteria. Behavioristic segmentation focuses on consumers' behaviors and patterns, such as purchasing habits or brand loyalty. Geographic segmentation targets consumers based on their location, which can significantly influence market trends and demands. Demographic segmentation divides the market based on characteristics such as age, gender, income, education, and family size, allowing businesses to tailor their marketing strategies accordingly. Commutative segmentation, on the other hand, is not recognized as a common type of market segmentation in marketing literature. This term does not correspond to a standard approach used by marketers to identify and analyze consumer segments. By distinguishing these segments, businesses can effectively target their offerings and marketing efforts, making the recognition of well-defined segmentation types essential for strategic planning.