STP Flashcards
What does STP stand for? Give an example of each stage.
Segmentation: identify and describe market segments.
E.g. male/female consumers of skincare.
Targeting: evaluate segments and decide which to go after.
E.g. females, aged 28-25.
Positioning: design a product/service to meet this segment’s needs and develop a marketing mix that will create a competitive advantage.
E.g. making a distinct moisturiser for this group.
What is market segmentation, and what good does it do? Cite a study.
It allows a division of a mass market into distinct groups/segments, within which individuals have common characteristics and needs and will respond similarly to each other in the group to marketing actions (Baines et al, 2021)
What is the reason for STP?
Enhances company’s competitive position, providing directions and focus for marketing strategies: targeted advertising, new proposition development, and brand differentiation.
What is the reason for STP? There are multiple, but list some.
Enhances company’s competitive position; providing directions and focus for marketing strategies: targeted advertising, new proposition development, and brand differentiation.
Allows a specific product/service to be produced to better fit the target audience.
Ensure that elements in the marketing mix are tailored to meet particular needs of different customer needs.
How do markets identify groups with particular differences?
Consumer criteria.
What is the consumer criteria consisted of?
Behavioural: How, who, where, why: Purchase/transaction, consumption/usage, media usage, technology usage, and functionality.
Psychological: why and who:
lifestyle, personality, perception, attitudes, motives, benefits sought
Profile: who and where:
demographic, socioeconomic, geographic.
Give an example of consumer segmentation variables.
Demographic:
- products that are aimed at older people (target is elderly)
- products that are aimed at singletons, ‘dinner for one’s, etc.
Psychographic:
- rides that are aimed for thrill seekers.
- sustainable products for ethical people
Identify 4 types of targeting strategy and an example of each.
Concentrated marketing: where a niche market aims for a specific group of consumers. Cex would be an example as they aim for gamers.
Undifferentiated: A large market aims for general consumers. An example of this would be supermarkets.
Differentiated: When markets create several different products to fill multiple different groups. An example would be Apple, as they make different types of tech.
Customised marketing: when marketing is targeted specifically for that individual consumer. An example of this would be when businesses analyse past purchase behaviour to predict what consumers may like and send emails to promote this.
What is the break-down and build-up method?
When segmenting groups you can break them down or build them up:
- break down: breaking up large groups into smaller groups that share similar interests.
- build up: adding similar individuals together to form a group with similar behaviours and attitudes.
What segmentations are the best with consumer criteria and using this information to segment groups?
Profile criteria is the easiest to collect but least informative.
Behavioural and psychological are the hardest to collect, but the most informative.
The best is to use both.
What is brand equity?
The influence of purchasing decisions, and the ability to create loyalty.
