A marketing strategy is one of the elements required when running a business. STP, or segmenting, targeting, and positioning, is one of several marketing techniques that can be used to increase the effectiveness of business marketing. See further explanation below.
What is STP Marketing?
STP marketing is a marketing strategy that determines how the business will be run. This strategy is comprised of three steps: identifying the segment, analyzing the target market, and determining the best position from which to run the business.
In addition to determining the direction of business marketing, the STP strategy can be an important step in establishing business credibility, brand image, and determining the marketing plan that will be implemented. This step, however, must be accompanied by teamwork and the preparation of a mature strategy.
STP Application Process
To be able to place the product on the right target, you must understand the STP strategy. But remember, the STP strategy focuses on the target market approach, not the product.
Segmenting is the first step of an STP strategy. In this step, you need to divide the target market into groups of potential consumers. Several market segmentation categories can be used as a benchmark for segmenting:
- Demographic is for the target market based on age, race, gender, education, occupation, religion and nationality.
- Geographic divides the target market based on geographic location, such as cities, provinces, countries, and even housing complexes.
- Psychographics is for the target market based on psychological traits, such as personality, lifestyle, hobbies, and others.
- Behavior is for the target market based on behavior when making a purchase, the purpose of purchasing the product, interest, and so on.
These product segmentation categories can be used as guidelines when determining a business's market segmentation. For example, a coffee business owner chooses to sell coffee beans to private workers who are domiciled in Lagos, with flexible working hours and prefer manually processed coffee.
The targeting analysis allows you to determine one of the segmenting results with the appropriate quality. Targeting takes into account the following factors:
Profit is the main factor you must consider when determining your target market. That's because you need profit to ensure the business can still run. Therefore, ensure you can determine the right market segmentation according to the targeted profit.
As a businessman, you must be able to project plans for several periods to come. Therefore, estimate the results that will be obtained after undergoing the STP strategy. Determine what steps you need to take to achieve your future vision or target.
- Ease of Access
Don't forget to consider how you will promote your product and make it accessible to buyers. For example, if you want to promote a product abroad, at least ensure you know how to ship goods. Then, also learn what will be your obstacles when choosing a target market.
The next STP marketing strategy is positioning, which is how to place advertisements or product promotions on selected segments with targets already set. This step will help you determine how to present the product to your target market.
As regards positioning, there are at least three things to keep in mind, which are:
- Offer solutions
After knowing the problems or complaints often experienced by the targeted market segmentation, it's time to identify the solutions they need. Then, determine the solutions that you can provide for your target market. This will determine the message that you will convey in your marketing plan.
- Finding the USP (Unique Selling Point)
When compiling a positioning for a business, you must be able to find the advantages that your product offers. After that, use that advantage to become a 'weapon' that can differentiate you from competitors.
- Arrange a campaign that the target market likes
Create an exciting campaign that your target market will like so that they can recognize the presence of your brand or product. An example is a marketplace site, which now uses a lot of Korean idols to market their brands.
Example of STP Marketing
This example of STP marketing can be easily found in almost all major brands today. However, it will help individuals who are starting a business from scratch.
For example, you want to start a culinary business. You've done market research and discovered that culinary is now popular, specifically in a café that offers drinks and snacks.
The STP marketing strategy example above is something like this:
Café is becoming popular among young people, so you choose this target market. Then, you divide into two psychographic segments: young people with limited funds and rich young people.
The menu is simpler and at an affordable price in a café for youth with limited funds. Meanwhile, the rich youth café has a premium menu at a fairly high price.
Next, the targeting analysis uses the three points that have been described:
In fact, of the two market segments, cafes with affordable prices are more popular among young people. Young people with limited funds can enjoy it, and at the same time, rich young people won't hesitate to visit the café if it has a good review.
- Size and Growth Potential
Both markets are quite large and have the potential to grow in the future. However, further study reveals that the market for young people with limited funds grows faster. The reason is that there are more young people with limited funds than rich young people.
- Ease of Access
Expensive cafes for rich young people must have a large parking space because they will come with their car. However, you have looked everywhere and discovered that the location has a small parking space based on your budget and can only accommodate two cars at most. Then you should consider opening a friendly-priced cafe. So it will be suitable for school children, students, and workers.
There are many cafés in the area. Thus, if you don't offer something different, your cafe won't be able to compete and will eventually go bankrupt. If this happens, then you rethink and conduct another research. You check the reviews on the internet and social media and visit all the cafes with low prices in the city to question customers directly.
In the end, you come to one conclusion: almost all WiFi in other cafes has slow speeds, and the signal is bad. In fact, many people want to use WiFi to do assignments, thesis, and play online games while drinking coffee. As a result, once they realize the WiFi is slow, most will immediately leave or will not visit the café again.
This is a loophole that you can take advantage of. With fast WiFi, you offer a solution that other low-priced cafes don't have. Thus, gaining more customers to your cafe.
Well, the description above is just a simple example with the aim of giving you a practical overview of the real world. You can see that with STP, the café has offered an advantage over competitors. If things continue like this, it's just a matter of time before the café can dominate that market segment.