Written by Steven Tate


Start here to refine your marketing strategy, engage your target audience, and carve a unique market niche with this comprehensive guide.


Introduction to STP Marketing


Knowing your audience is the name of the game in marketing.


A proven framework for this:

Segmentation, Targeting, and Positioning (STP)


STP Marketing offers a trifecta of advantages that can transform your business marketing efforts.


  1. Effective Resource Utilization: By focusing on specific segments, you can use your marketing resources more efficiently.
  1. Enhanced Customer Engagement: Tailoring your marketing strategies to meet the needs of specific segments leads to higher engagement rates.
  1. Competitive Advantage: Positioning your product precisely in the market gives you a competitive edge.


Delve into this step-by-step guide as we cover each aspect of STP Marketing, providing actionable steps, templates, and examples to help you implement this framework in your own business marketing endeavors.


Segmentation: Crafting Consumer Clusters for Precision Marketing


Segmentation involves dividing your market into distinct groups with specific needs or characteristics.


How to Identify and Analyze Market Segments


In this step, the aim is to understand your market better, identify opportunities, and lay a strong foundation for targeted marketing strategies.


1. Data Collection:


Collecting comprehensive data on current and potential customers is where your scope starts. Utilize tools like Google Analytics, customer surveys, and industry reports to gather both quantitative and qualitative data, helping you understand customer needs and behaviors thoroughly.


For new businesses, start by studying competitors and observing their customer interactions to gain insights into your target market. You can implement Google Analytics to track website visitors and engage with potential customers across various platforms. You can also tap into your personal network of family and friends to gather initial feedback on your products or services.


2. Variable Identification:


Identify relevant variables including:


  • Geographic Location: states, regions, countries, cities, or climate zones.
    • For instance, a winter coat retailer may target customers in colder northern regions while promoting lighter clothing in warmer southern areas.


  • Psychographics: lifestyle, interests, values, or personality traits.
    • For example, a luxury car brand might target individuals with a high-income, sophisticated lifestyle who value exclusivity and luxury experiences.


  • Behavioral: purchasing behavior, usage patterns, or brand loyalty.
    • A coffee shop chain could target customers who visit frequently and offer loyalty rewards to encourage repeat visits.


  • Demographics: age, gender, income, education, or marital status.
    • A streaming service may target individuals aged 18-24 who are college students, offering a student discount and tailoring its content recommendations.


Choose variables aligned with your business objectives to create meaningful segments that accurately represent your audience’s variance.


3. Segment Formation:

Form segments by grouping individuals with similar characteristics or behaviors. Approach this step strategically, ensuring each segment is distinct enough to warrant a unique marketing approach while remaining large enough to be viable for targeting.


Example Segmentation in Action:


Imagine a travel agency aiming to understand their customers better:


Data Collection: They gathered data from customer surveys and website analytics.


Variable Identification:

  • Geographic Location: Different regions preferred different destinations (e.g., cities, beaches).
  • Psychographics: Some valued sustainability, while others wanted luxury.
  • Behavioral: They noticed frequent and occasional travelers.
  • Demographics: Families, young professionals, and retirees had diverse needs.


Segment Formation: They formed segments:

  1. “Eco-Conscious Explorers”
  2. “Luxury Seekers”
  3. “Frequent Flyers”
  4. “Family Vacationers”


Next, they’ll target these segments to increase customer satisfaction and travel bookings.


Use a Segmentation Matrix for Your Business


Brainstorm and find your customer segments. Try Miro’s free Market Segmentation Matrix Template, like we did below.




Targeting: Hone in on Your Market for Amplified Results


Targeting includes selecting which of the segments to focus your marketing efforts on.


How to Evaluate and Select Target Segments


1. Assess Segment Attractiveness and Business Capability:

Before committing resources to target segments, first assess their attractiveness and evaluate your business’s ability to serve them effectively.


  • Market Attractiveness: Examine the market’s overall attractiveness for each segment. Factors to consider include the size of the segment, its growth potential, and the level of competition. A larger, growing segment with less competition may be more attractive, for example.
  • Segment Fit: Evaluate how well each segment aligns with your business’s core strengths, values, and expertise. Consider whether your products or services can genuinely meet the needs and preferences of each segment.
  • Resource Capability: Assess your business’s capabilities and resources. Do you have the marketing expertise, infrastructure, and budget required to effectively target and serve a particular segment? Be realistic about your limitations.


2. Align with Business Goals and Resources:

Once you’ve assessed segment attractiveness and your business’s capabilities, it’s time to align your choices with your broader business goals and available resources.


  • Business Goals: Consider your overarching business objectives. Are you aiming for rapid expansion, increased profitability, or market diversification? Your target segments should align with these goals at an individual level.
  • Resource Allocation: Allocate your marketing resources wisely. Different segments may require varying levels of investment in terms of advertising, product development, and customer support. Ensure that your chosen segments align with your budget and manpower.
  • Long-Term Viability: Think about the long-term viability of your selected segments. Will they continue to be profitable and relevant in the future? Anticipate market shifts and trends that may impact segment sustainability.


Example: Targeting in Action


Picture a specialty coffee company looking to target one of its customer segments.


They start by assessing:

  • Market Attractiveness: They evaluate various segments. One stands out—an emerging market of “Health-Conscious Coffee Aficionados.” It’s sizable, growing steadily, and has moderate competition.
  • Segment Fit: The company specializes in sourcing organic, single-origin beans. This aligns perfectly with the preferences of health-conscious consumers who seek quality and ethical sourcing.
  • Resource Capability: The business has the capacity to target this segment, including the ability to market premium coffee products.


Next, they align with:

  • Business Goals: The company aims for market diversification and increased profitability. The “Health-Conscious Coffee Aficionados” segment is in line with these objectives.
  • Resource Allocation: They allocate marketing resources to create content highlighting the health benefits of their coffee, certifications for ethical sourcing, and promotions targeting this segment.
  • Long-Term Viability: Data suggests that health-conscious trends are here to stay. This segment’s long-term viability appears strong.


Result: By targeting the “Health-Conscious Coffee Aficionados” segment, the company can successfully tap into a growing market that values their product offerings. With the next step, positioning, they can bolster themselves as a go-to brand for health-conscious coffee lovers.


Use a Targeting Assessment for Your Business


Use our scoring model template below to evaluate which segments you should target based on factors including size, growth, competition, and alignment with your business objectives.


Download our free PDF template here: RankFile Market Targeting Scoring Model Template.

Market Targeting Scoring Model Template for STP Marketing

Market Targeting Scoring Model Template for STP Marketing



Positioning: Sculpting a Unique Market Standpoint


Positioning is crafting a unique value proposition for the targeted segments to occupy a distinct place in the minds of your customers.


How to Develop a Unique Selling Proposition (USP)


1. Define what sets your offering apart from competitors:

Defining your USP involves identifying and clearly articulating what makes your product or service truly unique in the marketplace. Consider the following steps:


  • Market Research: Continue to conduct thorough market research to understand your competitors and their offerings. Identify gaps or areas where your product or service can provide something distinctive or better.
  • Unique Features: Highlight specific features, functionalities, or qualities of your offering that are unparalleled or significantly superior to what competitors provide. This could be related to product performance, design, pricing, or even customer support.
  • Customer Feedback: Listen to your existing customers. Their feedback is one of the best ways to reveal the aspects of your product or service offering that matter most to them and can be used to differentiate your brand.
  • Value Proposition: Craft a compelling value proposition that succinctly communicates the primary benefit or advantage your product offers. This should be something that resonates with your target segments and addresses a pain point or fulfills a desire they have.


2. Communicate the unique benefits and features to your targeted segments:

Once you’ve defined your USP, the next step is effectively communicating it to your target segments. Here’s how to do it:


  • Segment-Specific Messaging: Tailor your messaging to each target segment to ensure that they understand how your unique offering benefits them personally. Speak directly to their wants and needs.
  • Consistent Branding: Ensure that your USP is consistently integrated into your branding, from your website and advertising materials to your social media presence. Consistency is key to reinforce your brand in the minds of your customers.
  • Visual Storytelling: Don’t slack on visual content. Visual storytelling is paramount in our digital age to convey your USP.
  • Customer Testimonials: Share testimonials or success stories from satisfied customers who’ve experienced the unique benefits of your offering. These real-life examples are powerful social proof.


Effectively developing and communicating your USP is key to positioning your brand as distinct and valuable in the minds of your customers. It’s about creating a memorable and compelling narrative that resonates with your target segments, making them more likely to choose your product or service over competitors.


Example Positioning Statements

Here are some example templates you can use to craft your own USP statement for your business:


  1. “For [Target Segment], our brand provides [Unique Benefit] because [Reason].”
    • Example: “For fitness enthusiasts, our gym offers 24/7 access to state-of-the-art equipment because we know your workout schedule doesn’t follow a clock.”


  1. “Only [Your Brand] does/offers [Unique Benefit] in [Your Industry] because [Reason].”
    • Example: “Only AcmeTech offers a lifetime warranty on all our products in the electronics industry because we’re committed to quality and your satisfaction.”


  1. “Solve [Specific Problem] with [Your Solution], the [Unique Benefit] because [Reason].”
    • Example: “Solve your lawn care headaches with GreenGarden’s AI-powered robotic mowers, the future of hassle-free yard maintenance, because we believe your time is precious.”


  1. “Join [Desirable Outcome] with [Your Product/Service], your key to [Unique Benefit] because [Reason].”
    • Example: “Join the ranks of successful investors with InvestWise, your key to financial freedom and expert guidance because your future matters.”


  1. “Experience [Unique Benefit] like never before with [Your Brand], because [Reason].”
    • Example: “Experience speed like never before with BoltX internet, because your online world should never slow you down.”


These templates can help you create straightforward USP statements that succinctly convey your unique value proposition to your target audience. Customize them with your specific benefits and reasons to make them relevant to your business.


Measuring STP Success with KPIs


Once you’ve invested in segmenting, targeting, and positioning, your work doesn’t end there. To ensure your efforts are well spent, aligned with your customers, and bringing growth to your business, it’s crucial to continuously measure and evaluate your STP strategies.


Here’s a list of key performance indicators (KPIs) that can serve as your compass for assessing the viability of your STP and making informed adjustments as needed.


How to Use KPIs

Measure engagement, reach, conversion rates, and ROI to evaluate the effectiveness of your STP strategies:


  1. Engagement: Monitor the level of interaction your marketing campaigns generate. This includes tracking metrics like likes, shares, comments, and click-through rates on your website, emails, or social media.


  1. Reach: Determine how far your message is spreading within your selected segments. Assess not just the quantity but the quality of your reach. Are you reaching the right people within your chosen segments? Tools like social media analytics and email marketing metrics can help gauge this.


  1. Conversion Rates: Track how many of your leads or website visitors take the desired action, such as making a purchase, signing up for a newsletter, or filling out your contact form.


  1. Return on Investment (ROI): Ultimately, your STP strategies should deliver a positive return on investment. Calculate the ROI by comparing the revenue generated from your marketing efforts to the costs incurred. A positive ROI shows that your strategies are not only engaging and converting but also delivering a profitable outcome for your business.


  1. Customer Lifetime Value (CLV): This metric assesses the long-term value of customers acquired through your STP efforts. High CLV indicates that your strategies are not just attracting customers but also retaining them over time, which is often more cost-effective than continually acquiring new customers.


  1. Customer Satisfaction and Loyalty: Assess customer satisfaction through surveys, feedback, or Net Promoter Scores (NPS). High satisfaction and loyalty rates can be indicative of effective positioning, as it shows that your product or service aligns with and fulfills the needs of your target segments.


  1. Market Share: Track your market share within your target segments to assess your competitive position. An increase in market share indicates that your STP strategies are helping you gain ground in your chosen segments.


  1. Churn Rate: Keep an eye on customer churn rate. A low churn rate suggests that your positioning and targeting efforts are indeed retaining customers.


10 KPIs for STP Marketing Infographic

10 KPIs for STP Marketing Infographic


By regularly monitoring and analyzing these KPIs, you can gain valuable insights into the success of your STP strategies. Adjust your approach based on the data to optimize your marketing efforts and to set yourself up for continued growth and competitive advantage in your chosen segments.


STP Marketing Takeaways


  • Segmentation helps you divide your market into distinct groups.
  • Targeting focuses your efforts on the most promising segments.
  • Positioning crafts a unique value proposition to occupy a special place in your customers’ minds.


Steps to Utilize STP in Your Business:


  • Utilize the templates provided to start segmenting your market: Begin by gathering data, identifying variables, and forming distinct segments based on your analysis.
  • Evaluate and select your target segments: Assess the attractiveness of each segment, align them with your business goals and resources, and choose the segments that offer the most potential.
  • Develop a USP: Define what sets your offering apart, communicate this distinct USP to your target segments, and craft compelling messaging.
  • Measure success using KPIs: Keep a close eye on engagement, reach, conversion rates, ROI, and other relevant metrics to gauge the effectiveness of your STP strategies.
  • Keep optimizing your STP: Marketing is an ongoing process. Continuously refine and optimize your strategies based on performance metrics to ensure sustainable growth and to maintain a competitive edge in your market.



Implementing STP marketing is not a one-time task but a dynamic process that evolves as your business and market change. By consistently applying the principles and strategies outlined in this guide, you’ll be well-positioned to understand your audience, engage them effectively, and achieve long-term success in your marketing endeavors.


Rank & File can guide you through the STP marketing process and find viable paths forward for your business. Narrow in on your target market and grow your brand today by getting in touch with us:


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