This document outlines the five steps of an STP (segmentation, targeting, positioning) analysis process used by companies to identify their ideal customer base. The five steps are: 1) establish marketing strategy objectives, 2) use segmentation methods to divide the market into subgroups, 3) evaluate segment attractiveness, 4) select a target market, and 5) develop a positioning strategy to communicate the product's value proposition to the target market. The goal is to help companies focus on customers and position offerings to meet customer needs better than competitors.

1. Marketing Segmentation,
Targeting, & Positioning
By: Lou Klingensmith

2. What
is a STP
Analysis?
 The segmentation, targeting, and position process is
a five-step process that helps companies' home in on
their ideal consumer base and how to position their
offerings in a way customers understand why it
meets their needs better than the competitions.

3. • Articulatethevision ororobjectives ofcompaniesmarketingstrategy
• Harmonious with and developed from the company's mission, objectives, and
currentSWOTanalysis
Step One:
Establish the Overall
Strategy or
Objectives

4. SWOT Analysis
STRENGTHS WEAKNESSES
OPPORTUNITIES THREATS

5. Step Two:
Use Segmentation
Methods
 Choosingone ormoresegmentationmethodsfordividing themarket
 Develop descriptionsforeach segment
 Determinessimilaritiesamongeach segment
 Showsdissimilarities acrosssegments

6. Segmentation Types
Geographic
• Country
• Region
• Areaswithin aregion
Demographic
 Age
 Gender
 Income
 Education
Psychographic
 Self-values
 Self-concept
 Lifestyles
Benefit
 Benefitsderived fromproducts/services
Behavioral
 Occasion
 Loyalty

7.  Identifiable: Identify who is within their market in order to design products/services
to meet their needs
 Substantial: Determine market size ensuring its large enough and possesses enough
buyingpower
 Reachable: Must be able to reach target market through persuasive communication
and product distribution
 Responsive:Consumerreact similarly and positively to company offerings
 Profitable: Current and future profitability of segment base on market growth, market
competitiveness, and marketaccess
Step Three:
Evaluate Segment
Attractiveness

8. What
is a STP
Analysis?
The segmentation, targeting, and position process is a five-step process
that helps companies' home in on their ideal consumer base and how to
position their offerings in a way customers understand why it meets their
needsbetterthanthecompetitions.

9. Step Four:
Select a Target
Market
Undifferentiated Targeting Strategy (Mass
Marketing)
• Customersimilarity focused
• Perceivedto provided similarbenefits to
majorityof consumers
• No need for separatestrategy development
Micromarketing(One-to-One)
 Taylors product/serviceto individual wants&
needs
DifferentialTargetingStrategy
 Target severalmarketingsegmentswithoffers
tailored to eachsegment
 Helps diversify business &reducerisk
ConcentratedTargetingStrategy
 Single, primary targetmarket
 Focuses allenergyon providing a product to
meettheirtargetmarketsneeds

10.  Define the marketing mix variables so the target market
has a clear, distinctive, desirable, understanding of the
product/services compared to the competition's offerings
 Helps communicate value proposition
Value Proposition: Communicates benefits to be received
from product/service
Step Five:
Identify & Develop
Positioning Strategy