STP

Segmentation, targeting, and positioning together comprise a three stage process.  We first (1) determine which kinds of customers exist, then (2) select which ones we are best off trying to serve and, finally, (3) implement our segmentation by optimizing our products/services for that segment and communicating that we have made the choice to distinguish ourselves that way.

 

Segmentation-
Market segmentation involves grouping your various customers into segments that have common needs or will respond similarly to a marketing action. Each segment will respond to a different marketing mix strategy, with each offering alternate growth and profit opportunities. Consists of a group of customers who share a similar set of  needs and wants.

Types of segmentation-

Demographic

Geographic

Psychographic

Behavioral

Targeting - After segmenting the market based on the different groups and classes, you will need to choose your targets. No one strategy will suit all consumer groups, so being able to develop specific strategies for your target markets is very important.

Types of Targeting –

·   Multi-Segment Targeting

·   Undifferentiated Targeting

Concentrated Targeting 

Positioning - Positioning is developing a product and brand image in the minds of consumers. It can also include improving a customer's perception about the experience they will have if they choose to purchase your product or service.  The business can positively influence the perceptions of its chosen customer base through strategic promotional activities and by carefully defining your business' marketing mix.

STP Example -1: Tata Nano

Segmentation has been done with respect to Income levels of consumers. Different segments in the automobile market are: Rich, upper middle class, middle class, lower middle class, Poor.

Targeting – The selected target segment is “Middle class & Lowe middle class” who has aspiration to buy a four wheeler at cheaper price (price almost equivalent to high performance bike ~ 1 Lakh)

Positioning – The positioning message for Tata Nano are  “Sabse sastha gadi”, “ Khushiyon ki chabi” etc., that reflect characteristics like aspirations, affordability of target group

STP Example -2: ROLEX watches

Segmentation has been done with respect to Income levels of consumers. Different segments in the watch market are: Rich, upper middle class, middle class, lower middle class, Poor.

Targeting – The selected target segment is “Rich & Upper middle class” who are brand conscious and are willing to pay higher prices as long as they get satisfied product or service

Positioning – The positioning message for Rolex watch is “A crown for every occasion”. ROLEX is the official timekeeper for Wimbledon. Through its different marketing and advertising strategies, rolex positioned itself as Premium brand.