Market Segmentation, Targeting, and Positioning

STP powerpoint project

1. Market Segmentation, Targeting, and Positioning (STP) By: Eva Juszczyk

2. Introduction to STP Definition : The STP model is a three-step process that marketers use to identify, select, and communicate with target customers. Purpose : Helps companies optimize marketing efforts, reduce waste, and better meet the needs of specific customer segments. Components : Segmentation, Targeting, Positioning

3. What is Market Segmentation? Definition : Dividing a broad consumer or business market into sub-groups of consumers based on shared characteristics. Types of Market Segmentation : Demographic : Age, gender, income, education, etc. Geographic : Location, climate, region, etc. Psychographic : Lifestyle, values, personality. Behavioral : Buying behavior, user status, benefits sought. Example : A clothing company might segment by income (luxury vs. budget shoppers).

4. Benefits of Market Segmentation Improved Customer Focus : Tailor products and messages to specific customer needs. Efficient Marketing : Helps allocate resources more effectively. Competitive Advantage : Identify niche markets with less competition. Increased Customer Satisfaction : Meeting specific needs leads to higher satisfaction and loyalty.

5. What is Targeting? Definition : After segmentation, targeting is the process of evaluating each segment and deciding which to pursue. Types of Targeting Strategies : Undifferentiated Marketing : One marketing mix for all segments (mass marketing). Differentiated Marketing : Different marketing mixes for different segments. Concentrated Marketing : Focus on a single segment (niche marketing). Micromarketing : Tailoring products to suit individual customers or small segments. Example : Coca-Cola’s differentiated marketing (diet, regular, zero).

6. Criteria for Selecting Target Markets Segment Size and Growth Potential : Choose segments with enough potential for growth. Segment Structural Attractiveness : Analyze competitors and barriers to entry. Company Objectives and Resources : Match segments with your company's strengths and capabilities.

7. What is Positioning? Definition : Positioning refers to how a brand or product is perceived in the minds of the target audience relative to competitors. Key Components : Differentiation : How your product is different from competitors. Value Proposition : The unique value your product offers to the target audience. Positioning Statement Formula : To [target audience], [Brand/Product] is the [category] that [key benefit], because [reason why]. Example : Volvo’s positioning as the safest car brand.

8. The Positioning Process Step 1: Identify Competitive Advantage : What sets your product apart? (e.g., quality, price, features). Step 2: Determine Positioning Strategy : Attribute-based positioning : Focus on a key feature (e.g., durability). Benefit-based positioning : Focus on the benefit to the consumer (e.g., comfort, convenience). Use/application-based positioning : Position the product based on specific usage occasions. Step 3: Communicate Positioning : Create clear, consistent messaging through branding, advertising, and product design.

9. STP in Action: Case Study Example : Apple’s iPhone Segmentation : Segments based on income, lifestyle, and technology adoption. Targeting : Focuses on tech-savvy individuals, professionals, and high-income consumers. Positioning : The iPhone is positioned as a high-end, user-friendly smartphone with cutting-edge features and design. Why it works : Apple's segmentation and targeting allow it to create tailored products and marketing messages that resonate with their desired customer base.

10. Conclusion Summary : The STP process is essential for successful marketing as it helps brands focus on the most profitable segments and position themselves effectively. Key Takeaways : Market Segmentation helps identify consumer differences. Targeting helps select the most profitable segment. Positioning communicates how a product or brand fits within the market. Final Thought : Successful marketing is not about appealing to everyone, but about appealing to the right people in the right way.