Chapter 03

Segmentation, Targeting & Positioning

(STP)

MATHISHA HEWAVITHARANA

MBA (Col),BBA Sp.Mktng (Col), PPG DIP. In Mktng (UK), MCIM (UK), Chartered

Marketer (UK), Practicing Marketer (SL), ACMA, CGMA CIMA (UK), DBF (IBSL),

AIB (IBSL), MSLIM(SL),

Head of Leasing & Loans - Siyapatha Finance PLC

Resource Person

Chapter Contents

• Segmentation & Segmentation Variables

• Targeting Strategy

• Positioning Strategy

What is Segmentation ?

A market segment consists of a group of customers

who share a similar set of needs and wants.

Segmentation is….

Segmenting Consumer Markets

Geographic

Demographic

Psychographic

Behavioral

Segmentation variables in Consumer Markets

o Geographic Segmentation

Geographic segmentation divides the market into

geographical units such as nations, states, regions,

counties, cities, or neighbourhoods.

Segmentation variables in Consumer Marketso Demographic Segmentation

Demographic segmentation divides the market

based on a number of demographical factors.

Demographic Segmentation

• Age and life cycle

• Life stage

• Gender

• Income

• Generation

• Social class

• Race and Culture

Segmentation variables in Consumer Marketso Psychographic Segmentation

Psychographic segmentation divides the market based on

psychological factors such as Personality, Lifestyle or

Values & people with in the same demographic group can

exhibit different psychographic profiles.

Segmentation variables in Consumer Marketso Behavioral Segmentation

In behavioral segmentation, marketers divide buyers into

groups on the basis of their knowledge of, attitude toward,

use of, or response to a product..

▪Needs and Benefits

▪Decision Roles – Initiator / Influencer / Decider / Buyer / User

▪User and Usage – Occasions / user status / User rate / User readiness

o Behavioral Segmentation

Segmenting a Business Market

• Demographic (Industry / Company size / Location)

• Operating variable (Technology / Capacity)

• Purchasing approaches (Purchasing Policies / Criteria)

• Situational factors (Urgency / Size of order)

• Personal characteristics (Risk Appetite / Loyalty)

Effective Segmentation Criteria

• Measurable

• Substantial

• Accessible

• Differentiable

• Actionable

What is Targeting ?

Targeting is the rational identification of segments

to be focused in business.

Targeting

Targeting includes following;

▪ Ranking the market segments according to the

market potential

▪ Selecting the target segments accordingly

Targeting

Targeting decision will be basically taken after

considering the following two dimensions.

✓Market attractiveness – profitability, market growth

rate, entry costs, economies of scale, price

competition etc.

✓Business strength – relative market share, company

image, learning curve effect, product quality, R&D,

financial strength, patent rights etc.

Targeting Strategies

▪ Undifferentiated Targeting

(One product to the Entire market)

▪ Concentrated Targeting

(One product to One segment)

▪ Differentiated Targeting

(Different products to Different segments)

What is Positioning ?

Positioning is ……

Positioning process

o Identifying Competitors

o Analyzing Competitors

o Defining POP & POD

Points of Difference (POD)

“ Attributes or Benefits that Consumers Strongly

Associated with a Brand by Believing that they Could not

Find the Same in a Competitive Brand”

Points of Parities (POP)

“ Attributes Which Are not Necessarily Unique to the

Brand, But May In fact Similar to Other Brands”

Perceptual Maps / Positioning Maps

“ Visual Representation of Consumer Perceptions and

Preferences”

Positioning Approaches

- Rational Approach / Informational Appeal

(Functional Aspects of the Brand will be

Highlighted – product performance / USP’s / benefits etc.)

- Emotional Approach

( Emotional Selling Points – ESP’s)

Positioning Brand Mantra

“ Three to Five word

Articulation of the Heart

& Soul of

The Brand which goes

par to Brand Essence or

Core

Brand Promise”

Re-positioning

Re-positioning is ……

Review

• Segmentation & Segmentation Variables

• Targeting Strategy

• Positioning Strategy

Thank You !

0773 – 29 20 29

mathihewa@yahoo.com