Marketing: Segmentation - Targeting - Positioning

Summary

This business topic video introduces STP, a crucial marketing strategy model encompassing Segmentation, Targeting, and Positioning. It explains how businesses segment markets to identify attractive customer groups, target specific segments to focus marketing efforts, and position products to meet customer needs effectively. The video also touches on the challenges of market dynamics and the importance of viewing market positioning from the customer's perspective, emphasizing the value proposition as a competitive advantage.

Takeaways

• 📈 STP stands for Segmentation, Targeting, and Positioning, a fundamental marketing strategy model.
• 🎯 Segmentation is the process of dividing a broad market into distinct groups with similar needs and wants.
• 📊 Market segments can be identified based on demographics, geography, behavior, and other criteria.
• 🔍 Targeting involves selecting the most attractive market segments to focus on for marketing efforts.
• 📉 Mass marketing targets the entire market without segment differentiation, which is rarely successful.
• 🎯 Targeting can also involve focusing on one or more specific market segments with tailored marketing strategies.
• 🏆 Niche or concentrated marketing targets a very small, profitable segment to build a strong market position.
• 💡 Positioning is about how to compete in the chosen market segment and is centered around the value proposition.
• 🧭 The value proposition should be customer-centric, focusing on how customers perceive the product's value.
• 📊 A positioning map helps visualize a product's position relative to competitors based on key customer-value dimensions.
• 💼 There are various positioning strategies, including offering high value at a low price or adding more features for the same cost.

Q & A

What is the STP model in marketing?

The STP model in marketing stands for Segmentation, Targeting, and Positioning. It's a strategy used by businesses to develop a focused and effective marketing approach by dividing a broad market into distinct groups of consumers (Segmentation), selecting which groups to target (Targeting), and defining how to present products or services to these groups to meet their needs and wants (Positioning).

Why is market segmentation important for businesses?

Market segmentation is important because it allows businesses to identify specific groups of customers with similar needs and wants. This enables businesses to focus their marketing efforts more accurately, tailor their products and services to meet the specific needs of these segments, and ultimately, to be more competitive in the market.

What are the different ways to segment a market?

Markets can be segmented in various ways, including by household income (Income segmentation), age or gender (Demographic segmentation), geographic location (Geographic segmentation), and consumer behavior (Behavioral segmentation). Each method helps businesses to understand and target specific customer groups more effectively.

What are the challenges associated with market segmentation?

Challenges with market segmentation include the imprecise nature of the process, leading to potential overlap between segments. Additionally, segments can be fast-changing and dynamic, meaning that information about them might become outdated quickly, which can affect the effectiveness of marketing strategies.

What are the three different ways of targeting a market?

The three different ways of targeting a market are Mass marketing (or undifferentiated targeting), where the whole market is targeted without segmentation; Differentiated targeting, where one or more market segments are identified and products or services are designed to meet their specific needs; and Concentrated marketing (or niche marketing), where the focus is on a very small, profitable niche within the market.

Why is it important to consider the customer's point of view in market positioning?

Considering the customer's point of view in market positioning is crucial because it's the customers who ultimately decide the value of a product or service. Understanding their perspective helps businesses to create a value proposition that resonates with the target market and gives them a competitive advantage.

What is a value proposition in the context of market positioning?

A value proposition in market positioning refers to the promise of value that a product or service offers to the target customers. It's a statement that communicates the unique benefits and advantages of the offering from the customer's perspective, aiming to show why they should choose that product or service over competitors.

How can a positioning map help in market positioning?

A positioning map helps in market positioning by visually representing how different products or services are positioned in the market based on selected dimensions, such as price and quality. It helps businesses to identify gaps in the market and to strategize how to position their offerings to stand out from the competition and meet customer needs.

What are some possible positioning strategies for a product?

Some possible positioning strategies include offering high value at a low price, providing more features or better performance for the same price, or focusing on a niche market to maximize returns. The key is to understand how customers perceive value and to position the product in a way that offers superior value from their perspective.

How does the STP model contribute to the success of a marketing strategy?

The STP model contributes to the success of a marketing strategy by enabling businesses to understand their market, identify the most attractive customer segments, and develop targeted marketing plans that resonate with these segments. This leads to more effective marketing communications, better product offerings, and ultimately, increased customer satisfaction and business success.