Final answer:
Benefit segmentation is the process that categorizes consumers based on the benefits they seek from products or services, focusing on the psychological and behavioral drivers of decision-making.
Step-by-step explanation:
The type of segmentation that typically divides customers into groups based on the advantages they seek when making product or service decisions is known as benefit segmentation. Benefit segmentation focuses on discerning the specific benefits consumers are looking for in a product or service, such as quality, convenience, or price.
This approach can provide valuable insights into consumer preferences and drive the development of targeted marketing strategies that appeal to different segments of the market based on their unique desires and needs. In contrast to demographic or ethnographic segmentation, benefit segmentation is more concerned with the psychological and behavioral aspects of the consumer's decision-making process. By understanding these aspects, businesses can cater to the specific needs and wants of various customer segments, potentially leading to higher customer satisfaction and loyalty.