Segmentation, Targeting &
Positioning (STP)
Presented by
Prof. Ravi Dissanayake
: STP Strategy……………….
Market segmentation: Identifying and profiling
distinct groups of buyers who differ in their
needs and preferences compared to others.
Market targeting: Selecting one or more market
segments to enter.
Market positioning: Establishing and
communicating the key distinctive benefit(s) of
the company’s market offering to each target.
Creating perception or making point of difference
(POD) for your brand in consumer’s mind.
Market Approaches
A company offers certain product/marketing mix
products to everyone : Mass marketing
Common product is Offred to all possible customers
A company offers different products/brands to
different target market/s to satisfy their unique
expectations at a profit : Target Marketing
Different brands to different target customers
Example : Target Markets ( TG)
Munchee Lemon Puff : Family segment
Zesta Tea: Young married couples/ nuclear families
Micheling Tires: high-end customers
Lanka Tiles : Mid-income/high-income families those
who need quality and elegant looked tiles
NIKE: Active ,fashionable and high performing people
Discussion : Motorbike Case Study
Mass market: working Ladies in western province
( 250,000)
Segmentation :
Age 20-30 (40%),30-40 ( 35%) ,40-50 ( 15%) , 50+ ( 10%)
Income 50K to 100K, 100K to 150 K
Profession: Public sector/Private
sector/self-employed/Retired
Target market: Age 30-40, Middle Income ( 50K-100K),
Private & public sector employees. ( Market Targeting )
Develop a Perception about the brand (Positioning )
Offering a unique marketing mix ( 4Ps/7Ps) : TARGET
MARKETING
Target marketing process
Good Segment: Are you strategic??????
Useful market segments share certain characteristics:
MASDA
Measurable : 3.5 million ( SL School
population)
Accessible: Yes, no legal, social, ethical or
competitive issues
Substantial : Yes, large enough because 3.5
million is a good number
Differentiable : Yes, they need varieties,
fashion, brand values in a unique way
Actionable: Yes, DSI can apply its
Bases for Segmentation in Consumer
Market (B2C)1.Geographical Base
Segmentation Possible segments
Variable
Nation or country Sri Lankans, Indians, Americans, and Japanese,etc.
Density Urban, sub urban and rural
Region Asia, America, Africa, Europe, etc.
Climate Tropical, Moderate, continental, Polar, Dry
City Colombo, Kandy, Galle, Kurunegala etc.
Example for geographical
segmentation
Property selling company
People live in urban and suburban who are exposed to
dry climate .
MNC : People live in Indian sub -continent countries
spending urban life.
Bases for Segmentation in
Consumer Market 2. Demographic
Segmentation Variable Possible segments
Gender Male and Female Eg; Fashion
Age Below 15, 16 – 30, 31 to 50, 51 to 65, Above 65 etc.
Income Below 15000, 15001 to 30000, 30001 to 50000, above 50000 etc.
Education Primary, Secondary, Graduates, Postgraduates etc.
Family size 2-3, 4-5, 6-8, above 9,etc. Nuclear and extended families
Family life cycle Bachelor, Newly married couple, full nest I/II/III, Empty
- nest/II, Solitary survivor ( old but widow )
Occupation Private sector, Government sector, Self-employedetc.
Religion, Buddhist, Muslims, Hindus,etc.
Social Class Lower, Middle, Upper SEC
Family Life Cycle
Bases for Segmentation in Consumer Market
3. Psychographic: segmenting on way of thinking
Segmentation Variable Possible segments
Lifestyle Culture oriented, outdoor oriented and sport oriented etc
Perception Way you see the world and life ( Positive/conventional/dynamic)
Attitude Enthusiastic/ open-minded/receptive
Personality Compulsive, gregarious, authoritarian, ambitious
4. Behavioral
Segmentation Variable Possible segments
Occasions/Time Fashion: Party time/ official time/ smart casual time/ sport time
Benefits ( Eg: cars) Safety/design/brand image/entertainment/economical/durability /off-road
User status Non user, ex- user, potential user, first- time users, regular users etc.
Usage rate Light user, medium user and heavy user
Loyalty status None, medium, strong, absolute etc.
Buyer-readiness stage Unaware, aware, informed, interested, etc.
Bases for Segmentation in
Consumer Market: Behavioral
Segmentation Variable Possible segments (FOOTWEAR)
Occasions Party time, beach, jogging
Benefits Fashion, durability, comfortability , brand image, price,
User status Non user, ex- user, potential user, first- time users, regular users etc.
Usage rate Light user, medium user and heavy user
Loyalty status None, medium, strong, absolute etc.
Buyer-readiness stage Unaware, aware, informed, interested, etc.
Developing a segmentation Profile:
Mobile communication service
Age D Gender D Benefit B Usage rate B Lifestyle P
18-25 Make Lower charge Medium & Playful
/Female More Data less Relaxed
Value-added
services
50 above Ladies/ Low charges Medium Eve of life
gents Coverage Peace of mind
30-40 Gents Value added High Busy
services social
Service quality,
New technical
features
Classroom Work: Segmenting Tea
Market
Living Family Benefit Occasion Lifestyle Usage
Area Size
City Small Flavors/ Morning Busy Average
/Average quality/ Evening Happening
brand image
Urban Bachelors Taste Leisure time Sporty Avarage
Convenience Snack time Engaged
Easy use Active time Early career
Refreshment
Discussion
Importance of multiple segmentation for different industries
Strategic advantage of using micro segmentations: needs
more variables and approaches
Cross marketing opportunities available in micro segments
rather main segment
Product portfolio diversification needs to have differentiated
target markets: needs different segments/profiles
Risk averse strategy: needs more segments based on different
profiles to mitigate the market risk
Market TARGETING
Selecting most profitable or attractive segment or
segments is called as market targeting. Once the
market targeting is done, company has to execute
target marketing strategy meaning offering a suitable
marketing mix(BRAND) as per the requirements of
the target market.
The main factors should be examined to Target a
Market
Market Attractiveness: Profitability
Size of the market, future growth rate, less competition,
customer purchasing power and so on.
Business Strength: Strengths of the company to
operate in the segment ( finance strength, branding,
distribution, experience, technology and so on)
Market Targeting Strategies
Examples
Undifferentiated: Essential products with no branding
( Mass marketing )
Differentiated: TOYOTA
Vitz: Executive ladies /Young Females/Working
mothers
Hummer : Executive and Exclusive gents
Yaris: Family segment/gents
Concentrated : BMW ( High class/exclusive segments)
Positioning
What comes to your mind?
Taste & Happiness :
Innovative benefits: …………………….
Luxury driving experience:
Positive attitude : …………………………………..
Power & energy for active life:
…………………………..
Positioning
Positioning refers to the place that a brand occupies in
the minds of the customers and how it is
distinguished from the products of the competitors
and different from the concept of brand awareness.
Creating a clear brand perception in consumer mind is
called as positioning .
Positioning is the act of differentiating brand against
other brands. PoD
Positioning Map/Perceptual Map
This is a hypothetical tool or presentation of how your
brand is going to be located in consumer mind ( black
box).
Brand managers could use it for mapping, evaluating
and guiding entire brand promotional activities based
on the positioning core ( Brand Promise & Brand
Essence)
Positioning Strategies
Attribute Positioning : EGB with REAL GINGER
Benefit Positioning : Highlight special benefits as
PoD
Competitor Positioning: Position against competitors
User Positioning : Highlight who the user is
Price-quality Positioning : Value for money
Category Positioning : Position the brand in another
product scope ( ball room in sky: Boing , Shangri-La “
Another botanical garden”
Positioning Map Examples
Positioning a Brand
Positioning Map Examples
Brand Repositioning
Case Discussion
