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The Complete Guide to STP Marketing: Segmentation, Targeting & Positioning [2024 Update]

By Adrienne Bosch Last updated: 11 minute read Lead GenerationMarketing Guides

The STP marketing model, or segmentation targeting and positioning, is a framework that helps you identify your most valuable customer segment and develop your marketing mix and product positioning strategy specifically for that audience.

This enables you to maximize profitability with limited resources by focusing on your most valuable customers!

Today, we’re providing a step-by-step guide to developing an effective STP marketing strategy. We’ll also examine the important benefits of this framework and some successful examples.

Let’s dive in!

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    Developing an STP Marketing Strategy Step-by-Step

    1. Market Segmentation

    There are many ways to slice and dice your customer data and create audience segments.

    Customer segmentation criteria can be divided mainly into four groups:

    • Demographic segmentation: age, gender, household income, race, marital status, family size, occupation, etc.
    • Geographic segmentation: continent, country, region, city, zip code, etc.
    • Psychographic segmentation: interests, wants and needs, attitudes, lifestyle, etc.
    • Behavioral segmentation: past purchases, basket size, purchase frequency, site dwell time, use of promotions and coupons, etc.

    This step leads to more tailored and impactful marketing initiatives, i.e., customer-centric marketing.

    For example, a beauty brand may develop unique campaigns for various age demographics, emphasizing that the product suits each group’s specific skin needs.

    Taking it further, product development could conduct market research within each market segment and develop product positioning strategies accordingly. This can include variations in ingredients, packaging, or marketing communications to appeal to different customer segments.

    Types of Market Segmentation Infographic
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    2. Identifying the Target Market

    If you have the budget, technology, and human capital to invest in numerous marketing channels while personalizing messages to each segment, it is perfectly fine to attempt to appeal to different market segments all at once.

    However, more often than not, a marketing manager needs to pick a target segment (or segments) that best aligns with the brand’s competitive advantage, best attracts buyers to the product, resonates with marketing messages, converts easily to customers, and can be reached at a lower cost, i.e., maximum commercial attractiveness.

    Let’s not forget the customer acquisition cost!

    You can estimate the total market value for your most attractive segments. However, it is the serviceable obtainable market that matters.

    If the acquisition cost is significantly higher for the most attractive segment, e.g., competition is so fierce that you can only realistically convert a small slice of the pie, you might be better off pursuing the next most valuable customer segments to achieve maximum revenue.

    Sometimes, the audience segment is quite apparent. Other times, it requires some soul-searching:

    • What is your brand’s value proposition?
    • Do you have a superior offering to your competitors within the target market?
    • How do your potential customers perceive you?

    With a well-defined targeting strategy, you can craft messages that resonate deeply with your customer group.

    Using data analytics is crucial for continuously refining and understanding this audience profile.

    3. Product Positioning Strategy and Content Customization

    You might still have the same product, but depending on your target audience segments, how you highlight its value proposition might differ.

    For the same wellness app, you might focus on ease of use for a less tech-savvy baby boomer segment while highlighting the ability to customize the app for a millennial segment.

    In contrast to consumer-based positioning, brands must not neglect competitor-based positioning. This is your competitive analysis within the target customer base.

    It is helpful to draw up a product positioning map. A basic one will have two key positioning factors significant to your product, e.g., price vs. functionality, practical vs. fun, etc. You get the idea!

    The map provides the opportunity to clearly define your product differentiation strategy. It can also identify gaps between your product vs. your competitor’s, whether from the actual utilities or from customers’ perceptions.

    Personalization in marketing: 66% of customers expect brands to understand their goals, needs, and expectations (Salesforce)
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    One of the most significant advantages of positioning strategy is the ability to create bespoke content for different groups.

    This could involve crafting blog posts, videos, or social media content to address your target customers’ unique interests or challenges.

    Content marketing typically generates three times the number of leads as standard outbound marketing while costing 62% less. An audience-based content marketing approach means creating different versions of the same content, each highlighting your unique selling proposition but tailored to different target audiences.

    4. Marketing Mix and Targeted Content Delivery

    Following positioning strategies is the actual marketing campaign execution.

    How you deliver your campaign is highly dependent on your segmentation targeting.

    Your marketing mix determines how and where you deliver customized content to maximize your reach to different market segments.

    Brands might leverage Instagram’s visual appeal to attract younger demographics, while platforms like LinkedIn are more suited for B2B marketing strategies. TikTok is a no-brainer if you go after Gen Z, whereas you will find the most baby boomers on Facebook.

    Personalized email marketing, based on user behavior or interests, is another highly effective way to engage your target audience. These emails could offer tailored product suggestions, personalized deals, or content that aligns with the recipient’s interests or past purchasing behavior.

    Implementing successful targeted marketing strategies involves utilizing customer data to foresee future behaviors and adapt marketing communications accordingly. This could entail analyzing past purchases to anticipate future product interests.

    Ad retargeting targets potential customers who have previously engaged with your brand but haven’t purchased. By showcasing specific products they showed interest in, companies can enhance the likelihood of converting these interactions into sales. A common use case is finding those who have browsed your site or even placed a product in the cart on other sites and displaying the said product.

    Uses of retargeting targeted marketing strategy infographic by Adobe
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    Partnering with influencers who have a strong connection with your target segment can significantly boost your marketing efforts. These partnerships involve collaborating with influencers whose follower base aligns with your target audience.

    5. Feedback and Optimization

    Continuous feedback collection and campaign analysis are essential.

    Consumer attitudes, wants, and purchasing behaviors can change often, moving in and out of your target market.

    Your competitors’ market positioning can also change, making your past segmentation targeting assumptions invalid.

    This ongoing evaluation helps refine strategies, leading to constantly evolving and improving marketing efforts.

    The Role of Big Players: Facebook and Instagram

    Over 140 billion reels are played daily across Facebook apps, and 94% of marketers use Facebook advertising regularly.

    Moreover, with users spending about 30 minutes a day on the app, Instagram continues to be a significant platform for targeted marketing efforts.

    To learn about targeted marketing social media strategies on Facebook, check out this video by Nick Theriot:

    STP Strategies and Execution

    The execution of a STP strategy is an intricate blend of personalized content, insightful data analysis, and a profound understanding of the target audience’s needs. By concentrating on these key elements, you can develop compelling marketing campaigns that truly resonate with your audience, ultimately driving successful conversions.

    5 Top Benefits of STP

    1.Enhanced Customer Experience

    Understanding and catering to a certain target audience enables marketing efforts to be more tailored.

    This level of customization improves the overall customer experience, as consumers are presented with content, offers, and products that align with their unique preferences and interests.

    This relevance not only captures attention but also fosters a positive perception of the brand, enhancing the customer journey.

    Targeting also facilitates two-way communication. By focusing on an engaged audience, businesses can gather feedback and insights directly from their consumers.

    This leads to continuous improvement and a deeper understanding of customer needs. As such, this cycle of feedback and adaptation further improves the customer experience.

    2.Increased Return on Investment (ROI)

    Targeted marketing strategies are renowned for their cost-effectiveness.

    This is primarily because they focus resources on segments with higher total market demand and are more likely to engage or convert.

    By avoiding the scattergun approach of traditional marketing, targeted strategies ensure that every dollar spent is more likely to reach and resonate with the intended audience.

    This efficiency translates into a higher ROI, as marketing efforts yield tangible results in the form of leads, conversions, and revenue.

    Segmentation targeting also allows for continuous improvement. Marketers can monitor their marketing efforts, link performance to segment preferences and behaviors, decipher segment insights, and improve future campaigns.

    This ability to measure and tweak campaigns will improve your marketing ROI over time.

    Which marketing channel provides the best ROI Infographic
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    3.Improved Brand Loyalty and Engagement

    Targeting on relevant social media platforms can significantly boost customer engagement and brand loyalty.

    You can foster a deeper connection with your customers by delivering content that resonates with their interests and needs. This connection goes beyond mere transactions; it builds emotional ties, leading to long-term loyalty and advocacy.

    In addition, the STP model allows you to create a community around your brand. Engaging with customers on a personal level, responding to their comments, and sharing content that aligns with their values helps build a loyal community.

    This community not only supports the brand but also acts as its ambassador, further extending its reach and influence.

    4.Competitive Advantage

    A well-executed STP strategy gives your business a competitive edge.

    In a crowded market, addressing a defined audience’s specific needs and wants helps companies stand out.

    You can distinguish yourself from your competitors, who might be pursuing a larger audience, by focusing on niche markets or specific customer groups.

    Additionally, the STP model enables your business to build a strong brand identity.

    Companies can position themselves as experts in their industry by continuously catering to a specialized target audience.

    This specialization builds credibility and trust, making your brand the go-to choice for consumers within that target market.

    4 Targeted marketing strategies infographic
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    5.Higher Conversion Rates

    Personalized campaigns, by virtue of their relevance, are more likely to inspire action, whether it’s making a purchase, signing up for a newsletter, or engaging with content.

    This specificity ensures that marketing efforts reach and appeal to those most likely to respond positively.

    Additionally, the marketing model allows for the optimization of the customer journey.

    By understanding the path that customers take from awareness to purchase, you can create targeted campaigns that guide them through each stage effectively.

    This strategic approach lowers friction in the purchasing process, which leads to increased conversion rates and higher customer satisfaction.

    Top Benefits of STP Marketing and Why They’re Important

    • Enhanced Customer Experience
    • Increased Return on Investment (ROI)
    • Improved Brand Loyalty and Engagement
    • Higher Conversion Rates

    STP in Action: Successful Marketing Examples

    1.HBO’s “House of the Dragon” Campaign

    HBO’s advertising strategy for “House of the Dragon,” the “Game of Thrones” prequel, focused on engaging younger viewers.

    Their approach resulted in the extensive use of TikTok. By creating an official Game of Thrones TikTok account and posting teasers, HBO built up anticipation and sustained interest in the series.

    The use of TikTok’s stitch and duet features allowed fans to share and react to episodes together, boosting viewership and demonstrating the effectiveness of targeted social media marketing.

    HBO's House of the Dragon Marketing Campaign
    Image Source

    2.Old Spice’s “Smell Like a Man” Social Media Campaign

    Old Spice’s “Smell like a Man” campaign, launched in 2010, is a classic example of effective targeting.

    The brand utilized social media platforms, including Facebook and Twitter, to create interactive videos that responded to comments, engaging both men and women with humor and creativity.

    This approach not only advertised Old Spice’s products but also significantly increased its audience reach and social media followers, demonstrating the campaign’s viral impact and audience engagement.

    Here’s one of the ads that aired in 2010 for Old Spice’s “The Man Your Man Could Smell Like” campaign, posted by Old Spice:

    Final Thoughts on STP

    In conclusion, as we navigate through 2024, STP strategies are a keystone in the realm of digital marketing, offering businesses a methodical approach to connecting with their audience effectively.

    By understanding and leveraging the intricate web of customer data, preferences, and behaviors, companies can create marketing opportunities that resonate on a personal level.

    The STP marketing model transforms how brands communicate with and bond with their consumers, from customer segmentation to targeting to innovative applications in content customization and social media engagement.

    In essence, this approach is not just about reaching an audience; it’s about engaging with the right audience in the most meaningful way, marking a new era in marketing’s evolutionary journey.

    Frequently Asked Questions

    How does STP marketing benefit businesses in today's digital landscape?

    STP marketing offers numerous benefits, including enhanced customer experience, increased ROI, and improved brand loyalty. By focusing on specific audience segments, businesses can create more personalized and effective marketing strategies. For a detailed exploration of targeted marketing benefits and how they impact modern digital marketing, read the full article.

    What are some successful STP marketing campaign examples?

    Successful campaigns like HBO's "House of the Dragon" and Old Spice's social media strategy showcase the power of targeted marketing. These campaigns effectively used social media and content personalization to engage their target audience. To discover more about these campaigns and other examples, delve into the complete article.

    What strategies are crucial for effective STP marketing?

    Key strategies in STP marketing include market segmentation, targeting, content customization, personalized email marketing, and leveraging social media platforms. These strategies ensure businesses reach and engage their target audience effectively. For an in-depth understanding of these strategies and how to implement them, refer to the comprehensive guide in the full article.


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