How to improve segmentation targeting & positioning STP

Improving your segmentation, targeting, and positioning (STP) strategy means breaking down your market into different groups, picking the most promising ones, and then figuring out how to make your brand stand out to them.

Here are some ways to use marketing analytics tools to improve your segmentation targeting & positioning efforts:

1. Segmentation: This involves segmenting your market based on customer identity, preferences, behaviors, and needs.

• Market Research: Analyze your market to identify distinct segments.
• Segmentation Criteria: Determine the basis for dividing your market, such as age, geography, lifestyle, etc.
• Segmentation Strategies: Select a marketing strategy, whether mass marketing, targeting particular segments, concentrating on a niche, or personalizing for individual customers.

Example: A company that sells luxury watches may segment its market as follows:

1. Demographic Segmentation: Dividing the market based on age, income, occupation, and education. For example, targeting individuals aged 30-50 with a high income and professional occupation.
2. Psychographic Segmentation: Categorizing the market based on lifestyle, values, and personality. For example, targeting individuals who value luxury, craftsmanship, and status symbols.
3. Behavioral Segmentation: Segmenting based on consumer behavior, such as usage rate, loyalty, and benefits sought. For example, targeting frequent watch buyers who value quality and exclusivity.
4. Geographic Segmentation: Dividing the market based on geographical units such as region, city size, or climate. For example, targeting urban areas with a high concentration of luxury shoppers.

By segmenting the market, the company can tailor its marketing strategies and messages to each segment, increasing the effectiveness of its marketing efforts and ultimately driving sales.

2. Targeting: Once you have identified these groups, decide which ones to prioritize.

• Evaluate Segment Attractiveness: Assess the size, growth potential, competitive landscape, and your ability to serve each group.
• Select Target Segments: Choose the most appealing groups that align closely with your offerings.
• Develop a Targeting Strategy: Formulate a plan to engage and attract each selected group.

Example:Company- FitFlex Gym Equipment

Product: High-end home gym equipment

Target Market: Busy professionals who value convenience and quality

Targeting Strategy:

1. Demographic Targeting: FitFlex targets individuals aged 30-45, with a household income of $75,000 or more, living in urban and suburban areas.
2. Psychographic Targeting: They focus on busy professionals who prioritize convenience and value quality in their fitness equipment. These individuals are likely to have a high level of disposable income and are willing to invest in their health and fitness.
3. Behavioral Targeting: FitFlex targets individuals who have previously purchased fitness equipment or have shown an interest in home workouts. They also target those who follow fitness influencers or are members of fitness-related online communities.
4. Geographic Targeting: FitFlex focuses its marketing efforts on urban and suburban areas where there is a higher concentration of busy professionals with disposable income.
5. Online Targeting: FitFlex uses online advertising on platforms like Facebook, Instagram, and Google to target their audience. They use keywords related to home fitness, convenience, and quality to reach potential customers.
6. Content Targeting: FitFlex creates content that resonates with their target audience, such as blog posts about the benefits of home workouts for busy professionals and social media posts featuring testimonials from satisfied customers in similar demographics.

By using a combination of demographic, psychographic, behavioral, geographic, online, and content targeting strategies, FitFlex effectively reaches its target market of busy professionals who value convenience and quality, increasing the likelihood of conversion and brand loyalty.

3. Positioning: involves defining how you want your target audience to perceive your brand.

•  Differentiation entails identifying what sets your brand apart and why customers should prefer it over competitors.
•  Brand Image is about crafting a robust and cohesive image that resonates with your target demographics.
•  Communications Strategy encompasses planning the dissemination of your brand's distinctiveness via advertising, social media, and other channels.
•  Consistency requires ensuring that your brand's messaging and image remain uniform across all mediums and touchpoints

Example - Brand: Nike

Competitors: Adidas, Reebok, Under Armour

Positioning Statement: "Nike empowers athletes worldwide with innovative sports apparel, footwear, and equipment designed to unleash their full potential."

Explanation: Nike positions itself as a brand that inspires and empowers athletes of all levels. They focus on innovation, offering cutting-edge products that help athletes perform at their best. This positioning sets Nike apart from competitors like Adidas, Reebok, and Under Armour, emphasizing the brand's commitment to excellence and performance.

By doing these things and adjusting as you learn more about your market, you can make your marketing more effective and better meet the needs of your customers.

Links: MBA Notes