STP Process
- 1. STP Process SEGMENTATION, TARGETING, POSITIONING
- 2. What is STP? SEGMENTATION TARGETING POSITIONING
- 3. STEP 1: Establish Strategy or Objectives Narrow down company objectives The best time to use SWOT Market segmentation is useful to all company types, whether they are B2B, B2C, or even non-profit
- 4. STEP 2: Use Segmentation Methods Must also pay attention to the criteria of segmentation Market is divided into groups based on common characteristics Geographic- Where are they? Demographic- What is their structure? Psychographic- Who are they? Benefit- What will they gain? Behavioral- How will they use? Segments the market to help company understand customer profiles
- 5. Step 2: Use Segmentation Methods, Cont. Geographic: Continent Country State City Demographic: Gender Age Education Income Psychographics: Values Attitudes Lifestyle Interests Benefits: Convenience Economics Behavioral: Occasion Loyalty Engagement Usage
- 6. Step 2: Segmentation Methods, Cont Criteria of Segmentation Simplicity and cost effectiveness Potential for increased profit Similarity of needs within segment Difference of needs within segment Potential of marketing to reach segment
- 7. Step 3: Evaluate Segment Attractiveness Identifiable: The segment needs to be distinct to make marketing effective Substantial: needs to be big enough to provide business to Reachable: Is the market reachable? Responsive: Will the customers respond positively? Profitable: Will it make a profit?
- 8. Step 4: Select Target Market Now that the target markets have been identified and evaluated, it is time for the company to select their target market Target market: Specific segment of customers who are most likely to purchase the service/product Selecting an appropriate target market is important to a business because they must obtain the best return on investment possible
- 9. Step 4: Select Target Market, Cont. Undifferentiated: Mass marketing Differentiated: Targets several market segments in different ways Concentrated: One primary market gets focus Micromarketing: Custom marketing to very small groups (one-to- one marketing)
- 10. Step 5: Identify and Develop Positioning Strategy The company will develop a value proposition to explain to customers why they should choose the company’s product or service. In this step, the target market has been identified and now the company must identify an opportunity for marketing and develop a solution based on their findings.
- 11. STEP 5: Positioning Strategy, Cont. What the customer wants What your competition provides What your company provides Value Proposition Value Proposition