Assessment Two MKTM028: STP Segmentation, Targeting and Positioning Market Report

Table of Contents

1.0 Introduction. 2

2.0 Literature Review.. 2

2.1 Segmentation. 3

2.2 Targeting. 4

2.3 Positioning. 4

3.0 Different Industries Application. 5

3.1 Entertainment Industry. 5

3.2 Automotive Industry. 7

4.0 Recommendations 9

5.0 Conclusion. 10

References. 11

Appendices 15

Appendix 1: Maslow Hierarchy of Needs Theory. 15

Appendix 2: Spiral Dynamics model in entertainment industry (positioning) 15

Appendix 3: Automotive industry spiral dynamic model in positioning. 16

1.0 Introduction

In contemporary business environment, organisation success is dependent on embrace of strategic marketing. Strategic marketing is defined by Huang and Rust (2021) as a progressive practice which is evidence-based influenced by prevalent market dynamics which include customer behaviours, their demand and preference. Evidence-based practice is achieved by use of quantitative and qualitative insights which guide success of strategic marketing. Also, in achieving this, organisations also embrace technologies including Artificial Intelligence (AI) to source customer analytics information hence a success in segmentation, targeting and positioning them in particular markets. Further, according to Pitt et al. (2019), this is impacted by scope of being unique and embracing diversity in their products and services positioning. In line with this identified background information, aspects of Segmentation, Targeting and Positioning (STP) model is core to embrace best practice of attaining strategic marketing. Besides, albeit of the model criticality in strategic marketing, Goncharova et al. (2019) note on prevalence of a tension in the framework implementation. In this regard, the current report focuses on STP framework critical analysis with their use in the modern business environment for attaining a competitive advantage and dominating their markets established. For achieving this, a review of the application of STP in different industries with examples has been generated in this report.

2.0 Literature Review

As evidenced in the different literature sources reviewed, STP is a broad concept with different meanings. However, all definition converge at the meanings of Segmentation, Targeting and Positioning concepts. For instance, according to Liu and Wu (2013) definition, STP include a framework applied in offering an organisation market with distinct segments to establish target market with conveying of appropriate information pertaining to a product/service through an effective positioning. This definition is affirmed by Romppanen (2021) which note the STP as being inclusive of a set of marketing strategies guiding accurate location of a product/service in tandem with segmentation and selecting the best market. In line with both meanings, a market include involvement of various groups where an organisation is targeting (Liu & Wu, 2013; Romppanen, 2021). Besides, organisations products and services are offered depending on the organisation capability of establishing the most appropriate customer segment for good positioning. Hence, in defining STP, it is important to understand the definition of the concepts that make the model.

2.1 Segmentation

According to Mavragani et al. (2019), segmentation is core for subdividing homogeneous group by prioritising on their preferences for specifying a good marketing strategy. Additionally, Vada et al. (2019) note that market segmentation is impacted by aspects of behaviours and psychological with their instances including believes, values and attitude. Generally, segmentation is identified as categorising the markets into various segments or group of consumers with different wants and needs. For example, by breaking out particular features leads to successful creation of a marketing strategy and implementing an access and approach their linkage (Trudel, 2019). On the other hand, van Scheers (2018) define segmentation as being characterised by a set of challenges. In mitigating these challenges, segmentation offers a guidance of the organisation scope and making sure meaningful and connected to personalised characteristics and preferences. The main characteristic for success in segmentation include an act of differentiation, holistic practice, accessible and sustainability.

In line with the offered illustration of segmentation concept, the marketing expert ought to have the important skills and competencies to differentiate markets (Yoseph et al., 2019). A case example is where the various segments are defined with the main features including purchasing preferences, consumer behaviours and application. This is affirmed by Begunca, Arsim (2021) which prioritised on soft drinks organisations identified segmentation as required to be broad for accommodating profits and good communication oprocess for success in opromoitin, Additiionally, sustainabke strategy beed to be informed by current and future business environment change and as such achieve strategic marketing, This has been common amongst the Generation Zers and Millenials (ref) As evidenced in (ref), the need to follow the identified strategies are associated with the need to adopt strategies which are fit well with the customers insights and strategies being core.

2.2 Targeting

After successful segmentation, targeting is pursued. According to Lessmann et al. (2021), targeting is the final phase relevant for analysing and selecting most appropriate areas to focus on during marketing for optimum gains. This is after segmentation of the appropriate market is done. The definition is supported by Wenten (2020) study which had evaluated the Chinese Automobile sector and noted the importance of targeting. As similar argument is generated by Lessmann et al. (2021) and Wenten (2020) who evidence the existence of a core challenge of embracing a broad target for product and services and ought to be narrowed down. Therefore, good targeting contributes to an organisation being facilitated through an identification of the most appropriate population/groups for their products marketing (Berg et al., 2021). This represents a core aspect of making sure an organisation leverage on competitive advantage, improve their profits and dominate their individual markets.

Additionally, considering a more up-to-date study in Parsons and Barling (2022), targeting is similar to procurement of vegetables. In such a practice, the most appropriate approach for targeting is to place products in category of healthy products. As such, an organisation must apply the STP model for differentiating the target market eventually generating a custom marketing approach.

2.3 Positioning

Adopting the Christian (2020) definition, success in positioning entail identifying products features to customers of interest by use of a set of marketing approaches. Implementation of the process is after identification of a particular target of product/services provision through consideration of their unique features based on a customer expectation. The rationale of this is to develop a good positioning of their goods and services in the market of target. For instance, in most entities, innovation is embraced in products/services marketing. This is supported by VakadaeRamkumar et al. (2021) study which note a set of techniques used to harness identification and noting holistic approaches for achieving innovative results. Other than the analytics techniques, Macaulay (2018) noted the technology as being relevant in positioning. This is since it is appropriate in guiding the capacity of using adverts, creation of a premium category brand and product positioning in a market. As supported by Klarin (2019) findings, this is noted to promote the awareness level in a market of target pertaining products and services issued.

In summary, for the reviewed STP model literature, its relevance in contemporary entities is evidenced by offering a guidance on establishing strategic marketing in a unique manner over competitors. Also, Nurmahdi (2018) highlight on the challenging nature of this process owing to the importance of integrating data analytics. This is to source appropriate numerals and contextual datasets and information pertaining to the various segments, positions and market of target. As such, Tahir (2021) noted on the importance of using Maslow’s Hierarchy of Needs theory to note on the preferences of customers and requirements for establishing critical decisions on the most appropriate target market of a product as illustrated in appendix 1. Hence, the reviewed literature authors note on importance of using the model in harnessing the possibility of associating market mix with various aspects product placement inclusive.

3.0 Different Industries Application

In different industries, STP model application is unique and influence how organisation customise marketing strategies, products and services placement in best fitting market (Johnsson et al., 2019). This is since STP model ensure a customer is identified with the organisation positioned to their clients. As evidenced in Zeng et al. (2020), STP model best practice application entail linking it with a marketing mix and environmental analysis by use of SWOT. The association is informed by need to evaluate environmental factors impacting marketing foundation and successfully integrated.

3.1 Entertainment Industry

Entertainment industry is large and comprised of multiple industries and small industries (Aratuo & Etienne, 2019). As evidenced in Nhamo et al. (2020), small industries in the large entertainment industry are broadcasting, events management, gaming, designs, music and content editing. By use of STP model, it promotes a holistic analysis of the different market segments targeting products and services provide and group positioning. A case example is competing organisations operating in entertainment industry such as Netflix, Showmax and YouTube using the STP model by prioritising on the factors of demographic, psychographics and viewers number. As evidenced in Belbağ et al. (2019), demographics note on the need to prioritise specific employees earnings, gender differences and age aspect. Further, the age factor in entertainment industry is grouped into the adults, children and teenagers. Conversely, Gajanova et al. (2019) note that psychographics as inclusive of individualized value, opinions and unique strategy. In Netflix, the viewership numbers in the screens are under control.

For segmentation, entertainment industry ensures organisations offer products differentiation corresponding to distinct segments (Aratuo & Etienne, 2019). A personalised preference is used in differentiating groups. At the end, Nhamo et al. (2020) note that STP model ensures achievement of targeting and positioning is appropriately implemented. In entertainment industry, use of technologies impact segmentation. A case example is in the imaging and music entertainment sector including Netflix and YouTube investment with different resources in Artificial Intelligence and Machine Learning use adopted. This harness detailed information sourcing regarding different segments including preferences (Aratuo & Etienne, 2019). By embracing AI, an entity identifies most appropriate products in their various market groups.

In regard to targeting factor in entertainment industry, consumers preferences are applied in targeting the identified segments (Yadav & Srivastava, 2020). In different entities, a major issue faced by players in the sector include the lack of capacity for achieving preferences for various segments (Havard, 2021). The phenomenon in the entertainment industry is unique as the players have the capacity of customising offered products and services to their different customers. For instance, for Netflix, they popularly use Lengyel (2021) Unique Selling Proposition (USP). This is an aspect used to ensure that the clients have an exposure to various characteristics of an entity. Hence, in entertainment industry, target approaches are distinct in various identified segments. According to Camilleri (2018), the financial positioning of customers guide the best targeting approach adopted. This is popularly used in YouTube and Netflix which use various award categories to determine access to different contents with fewer or no advertisements evident.

Considering positioning, in the entertainment sector, the scope of competitiveness influences the customers possessing of different needs. According to Trung et al. (2021), innovation and being creative is core for ensuring all these customers preferences are attained. In Netflix and YouTube case example, entities are appropriately positioned with a good mindset for appropriate reasoning, comfortable, personalised, high-level quality and updating contents (Bishop, 2020). Additionally, the advantages of this entail use of different platforms with unique contents published. The noted aspects harness the satisfaction scope of the group target (Lengyel, 2021). Additionally, motivation scope for products and services procurement is harnessed. The STP summary in entertainment industry is evidenced in figure 1;

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Figure 1: Summary of the STP use in Entertainment Industry

Source: Summarised from Lengyel (2021)

For entertainment industry, positioning can be illustrated by applying the Spiral Dynamics model (vanova et al., 2021) as shown in appendix 2.

3.2 Automotive Industry…..

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