Strategic Marketing, Segmentation, Targeting and Positioning (STP)


“…positioning and segmentation and distinct parts of the [marketing] strategy and provide us with some extremely powerful tools; but ultimately they are linked by the central issue of focusing on satisfying customer’s needs in ways that are superior to competitors” (Hooley et al, 2012 p183)

Hooley et al (2012) Marketing Strategy & Competitive Positioning. 5th ed. Harlow Pearson.

By reference to academic literature, explore, evaluate, and critique, the concept of Segmentation, Targeting & Positioning (STP). Use appropriate examples (plural) from different industries (plural) to exemplify how organisations (plural) have applied STP, to demonstrate your learning and application of this topic.

Indicate how any company could apply the concepts around STP, making generic recommendations.

You are required to produce an essay that demonstrates your understanding of thois key aspect of strategic marketing.

The essay should have:

  • A sound theoretical and conceptual perspective, containing evidence of critical debate with reference to appropriate academic literature
  • Sound examination of STP and its application in industry showing an effective practical foundation
  • Generic management reccomendations


1.0  Introduction

This report explores and evaluates in-depth the concept of Segmentation, Targeting and Positioning. Through the adoption of a theoretical and practical context, different industry examples have been referenced in demonstrating the application of STP as a strategic marketing tool on how to create competitive advantage and delivery of superior customer value. To achieve the intended research objectives, the industries selected included travel and cars and lower-cost carrier FlyDubai, Emirates Airline and Fellari. The chosen case study industries markets have been segmented, selected their target markets and comprehensively positioned in the market.

At the end of this report, recommendations have been offered on the best practice in the integration of all STP concepts in organisation performance.

2.0 Overview and Analysis of Segmentation, Targeting and Positioning

Intense competition and consistent change characterize the contemporary business environment. This has necessitated organisations to adopt strategic approaches in ensuring they continue providing goods and services to customers for their satisfaction.  According to Kotler and Keller (2006), an appropriate marketing strategy is instrumental in assisting companies in achieving their set marketing objectives. The objectives assist attainment of corporate objectives to achieve competitive advantage over their rival organisations. As observed by Graham (2008), the strategy must be customer-centric and creating maximum value for an organisation. This is contrary to generic marketing strategies which are product-centric. This is affirmed by Vinuales et al. (2018) study that had observed that the use of segmentation ensures relevant tools are used and ultimately linked to the central issue of customer satisfaction superior to their competitors.

The modern business environment is characterized by different groups that are homogenous, different needs and expectations. To be in a position of marketing a product or a service in such a market, Dibb and Simkin (1997); Goyat (2011) observed that there it is essential to create segments to ensure that every business is gratifying better as opposed to their opponents and improving their overall appeal to the target markets. As highlighted by Khan (2013), the market segmentation process strategically involves categorizing a market in terms of the customers demographic, psychological and behavioural differences. To address the customers with different needs and expectations, segmentation ensures that similar customers are grouped. As noted by Kotler and Keller (2006), the rationale of grouping customers into segments include matching the products with their needs, leveraging on competitive advantage, increased market share through establishment of a market niche. This is possible since segmentation guides the engagement with customers, identification of new market targets, product development and pricing.

 Targeting follows after a successful market segmentation which involves the evaluation of the segment’s attractiveness and organizational resource strength. As noted by Goyat (2011), the rationale for this is guiding an establishment of a marketing program that ought to be inclusive of all marketing mix factors suitable for the targeted market. As evidenced in figure 1 below, the targeting process includes an evaluation of the organizational resource’s strength and market segment attractiveness.

Figure 1: Market Segment Attractiveness and Organisational Resource Strength

Source: Goyat (2011)

Targeting hence involve selection of one or more segments and evaluating their attractiveness which is a process of making the available resources to be used in venturing a specific market. It is in this regard that Lynn (2011) noted that targeting process is an authentic segment selection where an organisation ought to balance their capabilities and resources against the needs and expectations of different market segments.

Additionally, an evaluation of market segment attractiveness and the resources available determines whether to target only one or several segments. For instance, focusing on one segment would mean a concentrated strategy with a marketing mix and differentiated strategy for more than one market. According to Kotler and Keller (2006), the positioning is used in creating a recognizable, differentiated and desired market environment among the targeted clients with substitute products and services to create immense customer value. Market positioning involves making of a definitive decision on how and where the targeted customers are approached. According to Natter et al. (2008),………………………………………………………………………………………………………………………………………………Please contact our team to receive guidance on the entire version of this assessment