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 WHAT IS STP?
 Customers have unique requirements, aspirations and
satisfaction levels.
 Some customers though are different, have common
requirements for goods, services and ideas.
 If these customer's needs can be clearly identified and those with
similar needs are grouped based on quantities of sufficient size,
organization can be highly benefited.
 STP marketing is a three-step approach to building a targeted
marketing plan.
 "S" stands for segmenting
 "T" stands for targeting
 "P" stands for positioning
 Allows a business owner and marketing consultants or
employees to formulate a marketing strategy that ties company,
brand and product benefits to specific customer market
segments.
 SEGMENTATION
 As per the definition from Philip Kotler, “Market
segmentation is the sub-dividing of market into
homogeneous sub-sections of customers, where any sub-
section may conceivably be selected as a market target to
be reached with a distinct marketing mix.”
 Basically The process of dividing a market into smaller
homogeneous markets with similar characteristics is called
market segmentation.
 Segmentation is the first step in a three phase marketing
strategy.
 A market can be segmented based on demography, lifestyle
and personality, socio economic characteristics and the
benefits the customer seeks.
 An example from segmentation will be the success of
Japanese companies in England who have out-performed
their British rivals across a range of industries because for
perfectly managing the market segmentation.
 TARGETING
 Determine your target market and the attractiveness of each
segment by asking questions as:
 Is this segment large enough to be worth my time?
 Does this segment have the potential of being profitable?
 What sort of competition will I face by targeting this segment?
 Concentrate on and enter those segments in which we can
generate the greatest customer value over time.
 Keep in mind that your target market has to find value in what
you’re offering. You can choose to target different segments with
different campaigns.
 Nokia offers handsets for almost all the segments. They
understand their target audience well and each of their handsets
fulfils the needs and expectations of the target market.
 Tata Motors launched Tata Nano especially for the lower income
group.
 Clothing companies often target more than only one segment:
males, females, children and so on.
 POSITIONING
 We need to figure out how we are going to place the product/service in
front of the target segment that has been chosen in the previous two
phases.
 The most important question at this stage is “Why should the
consumers buy from me instead of my competitors?”
 For this we need to look at the wants and needs of targeted segment, or
the problem that our product solves for these people and create a value
proposition that clearly explains how your offering will meet this
requirement better than any of your competitors' products, and then
develop a marketing campaign that presents this value proposition in a
way that your audience will appreciate.
 Here, comes the need to have our own unique selling proposition
(USP) – a uniquely positive and extremely useful trait that your
competitors can’t or don’t offer.
 The USP should be the “edge” and the sole reason why the customers
will come knocking on our door. To build a great USP
• Understand What Your Customers Appreciate
• Understand What Your Customers Appreciate
• Defend Your USP
 IMPORTANCE OF STP
 Segmentation splits buyers into groups with similar needs and
wants to best utilize a firm's finite resources through buyer
based marketing. When the broad customer unit is divided into
sub groups of consumer with similar types of need, organization
can better focus on the market for their product.
 It helps in attracting the right customer. The product an
organization is producing are utilized by certain customers. By
using targeting, organization can get to the right consumer.
 STP reduces risk in deciding where, when, how, and to whom a
product will be marketed.
 It increases marketing efficiency by directing effort specifically
toward the designated segment in a manner consistent with
that segment's characteristics.
 It also reduces the cost of the company by not marketing the
product where its not required. Advertisement, public relation
and publicity are the most crucial costs of the company. By
doing STP, they are able to cut cost from these expenses which
eventually reduces their product cost.
 STP IN VOLKSWAGEN
 Segmentation : Volkswagen is producing different types of cars
for different needs under their subsidiaries. Each model of the
Volkswagen fully segmented with dedication to specific type of
customer. They are producing small cars like polo, golf and
famous beetle to much costly one like Lamborghini, Bentley and
Bhugatti.
 Targeting : Unlike most of the car companies in the market it
didn’t go for the single segment strategy and chose the multi
segment strategy. In general most of the cars are dedicated to
customers between 18-49 yrs old.
 Positioning : All Volkswagen models are present in every state
with high demand for cars, knowing after extensive market
research where should the company position a model more than
the other one (SUV’s in states with bad condition roads, pick up
cars in South America or Asia, smaller cars in crowded cities, or
more sedans or limousine in large business districts).
 STP IN ROYAL ENFIELD
 The two-wheeler market in India comprises of 3 types of
vehicles - motorcycles, scooters, and mopeds.
 Royal Enfield is an Indian motorcycle manufacturing brand
with the tag of "the oldest global motorcycle brand in
continuous production" manufactured in factories in
Chennai in India.
 Bound to take up the elite class people in the society.
 Concentrate only one segment and maintain their core
competency.
 Segmentation: Segmented as a leisure and adventure
curser bike.
 Targeting: Targets Bikers in the age group of 25-45 years of
age, they are working executives and young, rich & powerful.
 Positioning: Positioned as a leisurely, adventure, curser
bike and shows your social status is a symbol of your power
in society.
 STP IN COCA-COLA
 The best example we can give for the STP marketing strategy is
the company Coca-Cola.
 Segmentation : Coca cola company segmented its market into
three categories. These categories were Demography (age,
gender, family size and income); Psychography (life style and
social classes) and Geography (regions and climate).
 Targeting : The main idea while targeting the market for Coca-
Cola was
 Different Ads for different segments.
 Its primary market consists of people of age group of 10-25
 Positioning : The core idea for positioning done by Coca-Cola
was
 Fun and happiness.
 Think global, act global.
 One brand global marketing approach
 CRITICISMS OF STP
 A criticism against segmentation is that consumers are
unstable overtime and have rapid and diverse demands and
choices.
 Several researchers in marketing and consumer behavior
emphasized that consumers may belong to multiple
segments rather than one and only one segment.
 Positioning emphasizes the need for a company to be
different from other competitors out there, however
strategies should be driven by what customer’s value and
not by a company’s need to be different from their
competitors.

REFERENCES
 www-bcf.usc.edu/~proserpi/BUAD307-385.../BUAD-307-MKT-385-
Chap09.pdf
 https://marketingcgm95.wordpress.com/2012/12/27/arguments-against-
segmentation-targeting-and-positioning-in-the-marketing-plan/
 https://www.insivia.com/segmentation-targeting-and-positioning/