What is STP Marketing?
STP is a marketing model generally used to identify consumer patterns in the industry and meet various demands. The model comprises three parts – Segmentation, Targeting, and Positioning. Each plays a significant role in helping organizations adopt the best types of digital marketing practices to attract customers. In short, the model segments an audience into groups, targeting each group and positioning all products based on current consumer needs.
The STP model for each business depends on a formula Segmentation + Targeting Equals Positioning, where:
It is the process that businesses undertake to analyze audiences and divide them into smaller groups based on factors such as demographics, locations, income levels, and more.
It follows the segmentation process, and businesses use targeting to market their products to select audience groups created from segmenting.
It refers to creating a compelling marketing mix that will allow businesses to position their offerings in the market in a way that generates leads that turn into paying customers.
5 Different Types of Segmentation You Must Know
Segmentation is the process businesses use to divide their target audiences into smaller groups for more effective marketing. Having an understanding of what is digital marketing and how audiences will respond to it will help carry out effective segmentation. To simplify the process, there are five types of segmentations possible, and organizations can choose the ones that align with their services and marketing goals.
It refers to dividing audience groups based on age, gender, household, no. of children, nationality, and other similar categories. Businesses can then use this information to tailor their marketing practices to appeal to each group created and meets their interests.
For this, segmentation is done based on consumer patterns such as purchasing decisions, reasons, obstacles, tastes, preferences, etc. These are often more specific factors that help businesses narrow down the target customers they want to approach for marketing.
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Here, segmentation is done based on the geographical areas that a business is looking to target. It could include neighboring localities, a state, an entire city, etc. With this, organizations can market their offerings to select groups of people within a specific location and not in broad ranges.
The segmentation involves division based on psychological factors that may influence customer decisions. It could be consumer perspectives, benefits, long-term uses, and more. It helps businesses narrow down the most common reasons and tailor marketing practices that will speak to consumer emotions.
It is a segmentation type generally used in B2B settings. Factors such as the number of employees, type of industry, years in business, etc., are considered when creating marketing mixes for target customers.
The Fundamental Benefits of Segmentation to Consider
- Customer Retention
By segmenting audience groups, reaching out to consumers more effectively is possible. Businesses can use specific details that align with customer emotions and needs, thus allowing organizations to attract more customers and improve their loyalty.
- Improves Competition
With segmentation, businesses can understand their target audience groups more, which allows them to tailor their products and marketing practices to align with consumer needs. It helps them compete well with similar businesses within the same industry.
- Improves Profitability
Through segmentation and a better understanding of target customers, businesses can tailor their products and services to meet customer requirements in the most effective way possible. When consumers are satisfied, it becomes easier for companies to improve their profitability and grow well.
- Effective Marketing Practices
With the help of market segmentation, businesses can curate their marketing approaches to align with customers’ emotions and use methods that will speak to the audience and turn them into loyal customers.
- Better Utilization of Resources
Market segmentation gives organizations detailed information about their target customer groups. It allows them to allocate resources more efficiently regarding marketing, sales, customer service, etc.
Segmentation is an essential and effective part of an STP marketing model. It is the first step that paves the way for the model to go forward suitably. With the different types of segmentation possible, organizations must choose the most relevant and helpful ones that will give them the details about their target audience and allow them to take the best approaches to meet customer needs.
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