An Ultimate Guide for Segmenting, Targeting, Positioning (STP) Marketing Model - Digital Marketing | Paid Ads | SEO | Facebook Ads
An Ultimate Guide for Segmenting, Targeting, Positioning (STP) Marketing Model
Published on: August 10, 2021
Segmenting, Targeting and Positioning Marketing Model

Today, the STP marketing model (Segmentation, Targeting, Positioning) is a familiar strategic approach in modern marketing. It is one of the most commonly applied marketing models in practice. Marketing leaders crediting it for efficient, streamlined communications practice.

STP marketing focuses on commercial effectiveness, selecting the most valuable segments for a business and then developing a marketing mix and product positioning strategy for each segment. As Martech continues to develop, so do opportunities for segmentation, targeting, and positioning. So whether you’re brand new to STP or a seasoned veteran, it can be useful to take stock and double-check you’re utilizing every chance you get to reach, interact with, convert and engage customers.

In this article, you will be able to learn how STP works, how to implement it in business, the benefits of STP, and a lot more, so without any further a due let’s get started.

What is STP Marketing ?

STP marketing is an acronym for SegmentationTargeting, and Positioning – a three-step model that examines your products or services as well as the way you communicate their benefits to specific customer segments.

In a nutshell, the STP marketing model means you segment your market, target select customer segments with marketing campaigns tailored to their preferences, and adjust your positioning according to their desires and expectations.

Segmentation, Targeting, Positioning(STP) Marketing Model
Segmentation, Targeting, Positioning(STP) Model

The STP model is useful when creating marketing communications plans since it helps marketers to prioritize propositions and then develop and deliver personalized and relevant messages to engage with different audiences. The three-step funnel consists of market segmentation, market targeting, and product positioning.

Why STP is so effective in any Marketing Strategy?

STP marketing is effective because it focuses on breaking your customer base into smaller groups, allowing you to develop very specific marketing strategies to reach and engage each target audience. 

In fact, 59% of customers say that personalization influences their shopping decision and another 44% said that a personalized shopping experience would influence them to become repeat customers of a brand.

STP marketing represents a shift from product-focused marketing to customer-focused marketing. This shift gives businesses a chance to gain a better understanding of who their ideal customers are and how to reach them. In short, the more personalized and targeted your marketing efforts, the more successful you will be.

Applying Segmentation, Targeting and Positioning to digital communications

STP marketing is relevant to digital marketing too at a more tactical communications level. For example, applying marketing personas can help develop more relevant digital communications

The picture below shows how Segmenting, Targeting, and Positioning apply to digital strategy

It reminds us how digital channels offer new options for targeting audiences that weren’t available previously, but we need to reserve a sufficient budget. For example:

  • Search intent as searchers type keywords when comparing products they are interested in buying
  • Interest-based targeting in Facebook, e.g. Prospecting for those interested in Gardening, Gym membership, or Golf
  • Targeting through email personalization and on-site personalization based on profile, behavior (e.g. content consumed)

Now let us discuss all elements of STP i.e Segmenting, Targeting, and Positioning in details


Market segmentation is a marketing term that refers to aggregating prospective buyers into groups or segments with common needs and who respond similarly to a marketing action. Market segmentation enables companies to target different categories of consumers who perceive the full value of certain products and services differently from one another.

Companies can segment markets in several ways:

  1. Geographic Segmentation – Geographic segmentation is a marketing strategy to target products to people who live or shop in a specific location. This approach is particularly useful if you sell products that are subject to differences in regional culture, climate or population.

2. Demographic Segmentation – Demographic segmentation refers to the categorization of the target market based on specific variables like age, education, and gender. It is a type of market segmentation that helps businesses to understand their consumers better and meet their needs, effectively.

3. Psychographic Segmentation – Psychographic segmentation is defined as a market segmentation technique where groups are formed according to psychological traits that influence consumption habits drawn from people’s lifestyles and preferences. It is mainly conducted on the basis of “how” people think and “what” do they aspire to their life to be.

4. Behavioral Segmentation – Behavioral segmentation is a form of marketing segmentation that divides people into different groups who have a specific behavioral pattern in common. Users may share the same lifecycle stage, previously purchased particular products, or have similar reactions to your messages.

Market Segmentation Types
Several ways of Market Segmentation


The target market is the end consumer to which the company wants to sell its end products too. Target marketing involves breaking down the entire market into various segments and planning marketing strategies accordingly for each segment to increase the market share.

The list below refers to what’s needed to evaluate the potential and commercial attractiveness of each segment.

  • Criteria size: The market must be large enough to justify segmenting. If the market is small, it may make it smaller.
  • Difference: Measurable differences must exist between segments.
  • Money: Anticipated profits must exceed the costs of additional marketing plans and other changes.
  • Accessible: Each segment must be accessible to your team and the segment must be able to receive your marketing messages
  • Focus on different benefits: Different segments must need different benefits.
Market Targeting Strategies


Market Positioning refers to the ability to influence consumer perception regarding a brand or product relative to competitors. The objective of market positioning is to establish the image or identity of a brand or product so that consumers perceive it in a certain way.

For example:

  • A handbag maker may position itself as a luxury status symbol
  • A TV maker may position its TV as the most innovative and cutting-edge
  • A fast-food restaurant chain may position itself as the provider of cheap meals

There are various types of Positioning Strategies

•First -Positioning by specific product  attributes

•Second – Positioning by benefits

•Third – Positioning for user category

•Fourth – Positioning for usage occasion

•Fifth – Positioning against other competitors

•Sixth – Positioning against another product  class

Perceptual Map in Market Positioning

A perceptual map is used to show consumer perception of certain brands. The map allows you to identify how competitors are positioned relative to you and to identify opportunities in the marketplace.

An example of consumers perception of price and quality of brands in the automobile industry are mapped below:

Perceptual Map for Market Positioning

Benefits of STP

a) Segmentation splits buyers into groups with similar needs and wants to best utilize a firm’s finite resources through buyer-based marketing.

b) Attract the right customer.

c) Reduce risk in deciding where, when, how, and to whom a product will be marketed.

d) Increase marketing efficiency by directing effort specifically toward the designated segment in a manner consistent with that segment’s characteristics.

e) Helps in customer retention.

f) Customer delight

g) Reduce the cost of the company by not marketing the product where it’s not required. 


Using the STP process, businesses can identify their most valuable customer segments and create products and marketing communications that target those customers. This helps you create engaging, personalized marketing campaigns that convert visitors to customers at a high rate. 

For more details about STP, you can refer to the below video tutorial-