LSM - Lousy segmentation model for the insurance industry?

"Living Standard Measure (LSM) is probably the best recognised segmentation model in South Africa, and most marketing pitches will involve targeting the high LSM bands.  But while many think they have an idea what LSM represents, very few have any idea how it is calculated.  In a recent challenge to the marketing community, Eighty20 invited marketers to guess their own LSM. Of the 1,600 who tried, only 34% got it right.  This is worrying, as all marketers use LSM to describe their target market.  Would we tolerate a medical industry where only 34% of our doctors knew how a stethoscope worked?  This lack of knowledge is more concerning when this measure is applied outside the world of marketing."

Featured in Business Day, 27 July 2005.