Microsoft divides its customers into the following categories: small business, large business, government, and non-profit institutions. Which type of segmentation is Microsoft practicing?

Customer type segmentation categorizes buyers based on their organizational characteristics and buying patterns. Microsoft's approach groups customers by business size (small/large) and sector (government/non-profit), which directly reflects the type of entity rather than individual traits. This is distinct from demographic segmentation (which focuses on individual characteristics like age or income) or end-user segmentation (which focuses on how products are used).