Right STP is the Right Start to Your Growth Story!

This is where all the marketing begins. Before starting the work on any strategy and allocating budget to different ways and means of marketing your product we must divide the entire market into segments.

Choose the segment which suits you the most, which then becomes your target market.

Now you need to think on how best can you market your product to target the most specific customers in the chosen segment.

STP is one of the most popular models and it’s a must understand model before you draft any communication or plan advertising for the product. Your marketing tactics will be much more efficient and fruitful if you follow the STP Model.

In marketing, if you want to get high value for every rupee spent its imperative that you get specific. “SPECIFIC IS TERRIFIC” seems extra right when it comes to advertising and marketing. When I started my business in Tshirts Printing, Awards & Corporate gifting; we made a mistake of thinking that everyone needs Tshirts & gifts and hence all the people are or can be our customers. 

Result:

Ø  We choose too wide filters in Facebook advertising. The budgets were gone too fast and we didn’t get enough business from there. Our customer acquisition costs overshoot and went beyond the revenues, forget the profits.

Ø  We started accepting all size of orders and spreading ourselves too thin. Our hands got full with pea nuts and had no space for almonds.

Two years later when we made a conscious decision of targeting only the corporates and saying no to everything else – our revenues really grew.  

Another mistake which we made was – wrong positioning. Incidentally my company got positioned as retail personalized gift store. We realized that serving all is serving none. We must be specific and do the home work with STP.

STP focuses on commercial effectiveness, selecting the most valuable segments for a business and then developing a marketing mix and product positioning strategy for each segment.

Through segmentation, you can identify niches with specific needs, mature markets to find new customers, deliver more focused and effective marketing messages. You can use any of the below criteria for segmenting your market:

1.   Demographics – Age, Gender, Income, Education, Marital Status, Language they speak, having kids, no kids etc. This explains WHO the customer is.

2.   Psychographics – Here it’s all about emotions, behaviors and personality of the prospective buyers which becomes the basis for the segmentation. This explains why the customer buys your product. Gathering the psychographic data is much more difficult than the demographic data.

3.   Lifestyle – This refers to hobbies, interests, vacations, entertainment & other recreational activities liked by people. E.g.  home gym equipment sellers will target gym lovers.

4.   Beliefs and values – These maybe religious, political, economic or socio-cultural etc.

5.   Life Stages- this may also be a part of demographic but for some businesses this becomes very important and they may segment solely on the basis of life stage. I know a lady entrepreneur in tour & travel in Delhi and she focuses focuses on travel of people who are more than 50 years of age.  

6.   Geography – This can be filtered by country, state, city, village, area or even climate.

There can be few more bases on which you can segment the market but Demographic, Psychographic, Geographic and Behavioral are the four most commonly used parameters.

Of course the segment which you decide must be of good size. E.g. there is no point in selling something super specific only to the people of age 100 years or more. You can even go for multiple segments but the offering for them will be different.

Positioning map comes the last in the process. It needs two variables to position your product or service. By following the STP to the core, you can grow your business at a fast pace as the speed of customer acquisition becomes faster as you reach to the right customers with right messages. In Positioning we mainly focus on sales channels and product presentation.