Final answer:
Market segmentation is indeed about dividing customers into groups with similar characteristics, which is true. Social characteristics and differentiated products play a crucial role in defining these segments for targeted marketing approaches.
Step-by-step explanation:
True or False: Market segmentation is dividing customers into groups with similar characteristics. The statement is True. Market segmentation is a strategic marketing tool that involves dividing a broad target market into subsets of consumers, businesses, or countries that have, or are perceived to have, common needs, interests, preferences, and priorities. Businesses use this strategy to target these segments with customized marketing mixes.
Social characteristics such as gender, economic status, class system, and ethnicity play a significant role in market segmentation. Understanding these aspects helps businesses tailor their products and marketing efforts to better meet the needs of different segments.
The concept of differentiated products is significant in this context. Differentiation occurs because of the variety of products and services available, leading to monopolistic competition rather than a perfectly competitive market. This differentiation allows companies to target specific market segments more effectively.