The STP Process
 Segmentation is the process of classifying customers
into groups which share some common characteristic
...
Market Segmentation
The process of dividing a
potential market into
distinct subsets of
consumers and selecting one
or mor...
Why Segment?
Market
segmentation
More precise
definition of
customers needs
and wants
More accurate
marketing
objectives
I...
Advantages of Segmentation
1. The process of breaking up a homogeneous market
into heterogeneous segments forces the marke...
Steps in Segmentation, Targeting, and Positioning
1. Identify Bases
for Segmenting the Market
2. Develop Profiles
of Resul...
• Size, purchasing power, profiles
of segments can be measured.
• Segments can be effectively
reached and served.
• Segmen...
Levels of Market Segmentation
Mass Marketing
Same product to all consumers
(no segmentation)
Segment Marketing
Different p...
Bases for Segmenting Consumer Markets
Geographic
Demographic
Age, gender, family size
and or income
Psychographic
Social c...
Summary of Basic Methods
Market Segmentation
Occupation
SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES
Geographic Segmentation
Climate
Density o...
continued
SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES
Psychological Segmentation
Learning-involvement
Perception
Per...
SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES
Use-Related Segmentation
Brand loyalty
Awareness status
Usage rate Heavy...
Indian car market Segmentation
THE TOOTHPASTE MARKET
The package of benefits sought
 WHITENESS
 FRESHNESS
 GOOD TASTING
 PRODUCT APPEARANCE
 DECAY P...
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STP

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STP

  1. 1. The STP Process  Segmentation is the process of classifying customers into groups which share some common characteristic  Targeting involves the process of evaluating each segments attractiveness and selecting one or more segments to enter  Positioning is arranging for a product to occupy a clear, distinctive and desirable place relative to competing products in the mind of the consumer
  2. 2. Market Segmentation The process of dividing a potential market into distinct subsets of consumers and selecting one or more segments as a target market to be reached with a distinct marketing mix.
  3. 3. Why Segment? Market segmentation More precise definition of customers needs and wants More accurate marketing objectives Improved resource allocation Better marketing results
  4. 4. Advantages of Segmentation 1. The process of breaking up a homogeneous market into heterogeneous segments forces the marketer to analyse and consider both the needs of the market and the company’s ability to competently serve those needs – thereby making the company better informed about its customers 2. Competitor offerings and marketing positioning must also be analysed in this context so the company must consider what its competitive advantages and disadvantages are, helping it to clarify its own positioning strategy 3. Limited resources are used to best advantage, targeted at those segments that offer the best potential
  5. 5. Steps in Segmentation, Targeting, and Positioning 1. Identify Bases for Segmenting the Market 2. Develop Profiles of Resulting Segments 3. Develop Selection Criteria 4. Select Target Segment(s) 5. Develop Positioning for Each Target Segment 6. Develop Marketing Mix for Each Target Segment Market Positioning Market Targeting Market Segmentation
  6. 6. • Size, purchasing power, profiles of segments can be measured. • Segments can be effectively reached and served. • Segments are large or profitable enough to serve. Measurable Accessible Substantial Differential Actionable • Segments must respond differently to different marketing mix elements & programs. • Effective programs can be designed to attract and serve the segments. Requirements for Effective Segmentation
  7. 7. Levels of Market Segmentation Mass Marketing Same product to all consumers (no segmentation) Segment Marketing Different products to one or more segments (some segmentation) Micromarketing Products to suit the tastes of individuals and locations (complete segmentation) Niche Marketing Different products to subgroups within segments (more segmentation) Local Marketing Tailoring brands/ promotions to local customer groups Individual Marketing Tailoring products/ programs to individual customers
  8. 8. Bases for Segmenting Consumer Markets Geographic Demographic Age, gender, family size and or income Psychographic Social class, lifestyle, or personality Behavioural Occasions, benefits sought, user status, usage rate, loyalty Nations, states, regions or cities
  9. 9. Summary of Basic Methods
  10. 10. Market Segmentation Occupation SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES Geographic Segmentation Climate Density of area City Size Region Southwest, Mountain States Major metropolitan areas, small cities, towns Urban, suburban, rural Temperate, hot, humid, rainy Demographic Segmentation Income Marital status Sex Age Under 11, 12-17, 18-34, 35-49, 50-64, 65-74, 75-99, 100+ Male, female Single, married, divorced, living together, widowed Under 25,000, 25,000-34,999, 35,000-49,999, 50,000- 74,999, 75,000-99,999, 100,000 and over Education Some high school, high school graduate, some college, college graduate, postgraduate Professional, blue-collar, agricultural, military
  11. 11. continued SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES Psychological Segmentation Learning-involvement Perception Personality Needs-motivation Shelter, safety, security, affection Extroverts, aggressives, Low-risk, moderate-risk, high-risk Low-involvement, high-involvement Psychographic Subcultures (Race/ethnic) Religion Cultures (Lifestyle) Segmentation Economy-minded, outdoors enthusiasts, status seekers American, Italian, Chinese, Mexican, French, Pakistani Catholic, Protestant, Jewish, Moslem, other African-American, Asian Family life cycle Social class Lower, middle, upper Bachelors, young married, full nesters, empty nesters Attitudes Positive attitude, negative attitude Sociocultural Segmentation
  12. 12. SEGMENTATION BASE SELECTED SEGMENTATION VARIABLES Use-Related Segmentation Brand loyalty Awareness status Usage rate Heavy users, medium users, light users, non users Unaware, aware, interested, enthusiastic None, some, strong Use-Situation Segmentation Location Objective Time Leisure, work, rush, morning, night Personal, gift, fun, achievement Home, work, friend’s home, in-store Person Self, family members, friends, boss, peers Benefit Segmentation Convenience, social acceptance, long lasting, economy, value-for-the-money
  13. 13. Indian car market Segmentation
  14. 14. THE TOOTHPASTE MARKET The package of benefits sought  WHITENESS  FRESHNESS  GOOD TASTING  PRODUCT APPEARANCE  DECAY PREVENTION  GUMS PROTECTION  TEETH SENSITIVITY  ECONOMY

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