MARKETING 101: Marketing Segmentation, Targeting, and Positioning

Summary

In this informative marketing video, Adam introduces the STP model: Segmentation, Targeting, and Positioning. He explains the importance of dividing the market into segments to identify the most suitable customer base. Targeting involves choosing the most attractive segment to serve, while Positioning is about differentiating your product in the minds of customers. Adam emphasizes the value of these principles for businesses of all sizes, providing practical strategies for effective marketing.

Takeaways

• 📈 Segmentation is the process of dividing the market into different groups based on characteristics such as demographics, geography, behavior, and psychographics to better understand and serve specific customer needs.
• 🎯 Targeting involves selecting a specific segment from the market to focus on, answering the question of who the business wants to serve, and ensuring alignment with the company's capabilities and customer preferences.
• 🤝 Positioning is about how customers perceive the brand, product, or service in relation to competitors, and it's crucial for standing out in the market by occupying a unique place in the customer's mind.
• 💡 The STP model (Segmentation, Targeting, Positioning) is foundational to marketing success and applicable to businesses of all sizes, from small ventures to large corporations.
• 🚫 Avoid targeting 'everyone' as it's too broad and inefficient; instead, focus on segments that are most attractive and profitable for the business.
• 🔍 Demographic segmentation looks at factors like age, gender, income, and occupation to group potential customers.
• 🌍 Geographic segmentation categorizes people based on their location, such as city, state, province, or country.
• 🛍 Behavioral segmentation considers the customer journey stage or the specific benefits customers are seeking from a product or service.
• 🧘 Psychographic segmentation groups people by their values, attitudes, and lifestyles, which can be particularly insightful for understanding customer motivations.
• 📊 Analyzing top customers can help identify common characteristics and preferences, guiding businesses to refine their targeting strategy.
• 🌟 Differentiation is key for effective positioning, as it sets the business apart from competitors by emphasizing unique features, services, relationships, or brand image.

Q & A

What are the three fundamental components of the STP model in marketing?

The three fundamental components of the STP model in marketing are Segmentation, Targeting, and Positioning.

Why is it impractical for a business to try to reach every single person on the planet with their marketing efforts?

It is impractical because it would be outrageously expensive and most people would not be the right fit for the business, leading to inefficient use of marketing resources.

What is the main purpose of market segmentation?

The main purpose of market segmentation is to classify or categorize different groups of people based on their attributes or characteristics so that a business can identify the most suitable segments to target.

How does demographic segmentation differ from geographic segmentation?

Demographic segmentation groups people according to age, gender, income, or occupation, while geographic segmentation categorizes people based on their location such as city, state, province, or country.

What is behavioral segmentation and how does it relate to the customer journey?

Behavioral segmentation involves grouping customers based on what stage of the customer journey they are on or the benefits they are seeking, allowing businesses to tailor their marketing strategies to specific customer behaviors.

Why is it important for a business to choose a specific target market segment?

Choosing a specific target market segment allows a business to focus its resources and efforts on the most attractive and profitable parts of the market, ensuring efficient marketing and better customer satisfaction.

How does targeting differ from segmentation in marketing?

Segmentation involves dividing the market into different groups, while targeting is the process of selecting which of those segments the business wants to pursue with its marketing efforts.

What is the role of positioning in the marketing strategy?

Positioning is about how a business wants its product or service to be perceived by customers in relation to competitors, aiming to create a unique place in the customer's mind.

Why is differentiation important for a business in a competitive market?

Differentiation is important because it helps a business stand out from competitors by highlighting unique features or characteristics, preventing the brand from getting lost in the market noise.

Can you provide an example of how a company used positioning to stand out in the market?

An example is 7UP, which positioned itself as the 'Uncola' in the cola market, differentiating itself from other colas and creating a unique position in the minds of consumers.

What are some common methods of differentiation that a business can use to achieve a desired market position?

Common methods of differentiation include product differentiation (changing features or improving performance), service differentiation (providing better quality service), relationship differentiation (enhancing customer touchpoints or service), and image differentiation (influencing customer perception through marketing and branding).