Strategic Marketing

Table of Contents


Target Marketing.





STP for strategic implementation solutions.




Introduction to Strategic Marketing

Marketing is not just a business function or selling. It has become more complex than that. Alsem(2019) mentioned that today, marketing is not just a way of doing business or a function. It is not a job to fool customers or a new ad campaign. Marketing has become a tool to integrate the customer into product design and to design a systematic process to facilitate customer and business interaction to create sustainable relationships. Although there are numerous marketing approaches, most of them are a variation of either target marketing or mass marketing. While mass marketing is the process through which marketers deliver the promotional message towards a wide population base, target marketing, on the other hand, breaks down the market into specific sections and focuses the marketing efforts on specific targets. Both of the marketing practice have their benefits and are used to the marketing objective, marketing literature clearly shows that targeted marketing is more effective. Furthermore, one of the key benefits of targeted marketing is its ability to distribute the message to a specific audience which is more likely to respond (Dolnicar, Grun and Leisch 2018).

This report presents an analysis of the targeted marketing approach of segmentation, targeting, and positioning (STP). The report will evaluate the said concepts and critically appraises the way STP can be applied to develop solutions for strategic implementation issues. Finally, the report concludes with generic management recommendations for businesses regarding effective decision making.

Target Marketing

As mentioned earlier, target marketing includes breaking down the marketplace into different sections and then focusing promotional efforts on some of the selected key market segments. Such segments are divided according to the characteristics of the customer which enables the businesses to deliver promotional content in a segment whose needs and desires are most closely matched with the offerings. Palmaier and Crecelius(2019) mentioned that the beauty of target marketing is that focusing marketing efforts on a certain group of customers, makes the pricing, distribution, and promotion of the products and services much easier and cost-effective. To effectively employ target marketing, marketers usually use the STP strategic approach which is one of the most commonly used marketing modes in practice.


In marketing, STP stands for market segmentation, targeting, and positioning which helps marketers to craft marketing messaging tailored to engage segmented audiences. STP concentrates on commercial effectiveness to select the most valuable segments most suitable for marketing objectives and to cultivate a product positioning strategy and marketing mix for the individual segment. Under the STP approach, the audience base is first divided into segments and the relevant segment is target according to the interest of segment and then products are developed according to the targeted segment. The major aim of STP marketing is to not only attract customers but also to get the right consumer who will be interested in the product (Ernst and Dolnicar 2018).


Segmentation has been the focus of a significant part of marketing research literature since the early 1960s and has been regarded as a key marketing concept. In marketing, segmentation helps to identify niches with specific desires and needs that marketers can articulate clearly. Segmentation divides the market according to various characteristics such as demographic, psychographic, and behavioural (Dibb and Simkin 2016). This allows the marketers to identify the wants and desires of the targeted segment and to deliver a more personalized marketing message. The core concept of segmentation has not been altered and its fundamental approaches are still valid in the current business environment. Conceptually any business strategy should be formulated on a sound understanding of the target segments. The figure mentioned below illustrates the key concepts of segmentation and their progression.

At its core, segmentation deals with the identification of potential and existing consumer base and the understanding of the evolving needs of the target segments. Numerous unpublished and published case studies demonstrate the value of segmentation. Cengel and Ledo Hernandez (2019) researched the way segmentation of store choice decisions of shoppers reveals key differences in-store and customer preferences. Ultimately market segmentation adds the ability to cater to the diverse needs of a consumer market, with diverse consumer interests, perceptions, and interests. Segmentation further allows businesses to allocate their resources to formulate a marketing mix according to the requirements and needs of the target segment (Andaleeb 2016). However, while segmentation provides a competitive edge and direction to the marketing efforts, it is an objective approach that raises concerns about its viability.


After segmentation, the STP approach includes targeting, which includes deciding which of the segments created in segmentation is most attractive. Simply put, targeting helps to determine the commercial attractiveness of the individual segment. Targeting can be based on several different factors such as the size of the segment, the profitability of the segment, and easy to reach. It is niche-specific marketing and the niche is based on customers, rather than on the products. Marketing strategies cannot aim to sell the product to everyone as not everyone is interested in the product (Pooler 2018). Moreover, with the increase in a market segment, change in purchasing power of people, and an increase in competition, it has become a necessity to employ different types of marketing strategies to influence customer decisions.

To do so, there are several segments available in the market; however, originally, there were only 4 types of target marketing, namely, undifferentiated marketing, focused marketing, differentiated marketing, customized marketing. The undifferentiated marketing approach is used by companies with one type of product and has limited knowledge of customer behavioural patterns and characteristics. Coca-Cola is one of the best examples of this approach with a fixed type of production and a vast audience base (Armstrong, Kotler, Harker, and Brennan 2018). On the other hand, differentiated marketing is used to cater for the needs of multiple audiences to boost profitability and economies of scale, for instance, Apple with its wide range of products for different tech audience. Focused marketing is useful for companies with limited resources and creates a loyal fan base.

The main focus of focused marketing is on marketing and innovation. Lately, customized marketing serves the company and public relations where companies provide the products according to the needs and desires of consumers to resolve the problems of consumers (Dietrich, Rundle-Thiele, and Kubacki 2017). This marketing approach does not cater to a large audience but allows companies to build a sustainable relationship with their customer base.


The final step of the STP approach is positioning which refers to the place i.e. where the product stands in the market. It means the way product stands differ for the substitutes available the market and the way it is better than the products of business competitors. Marketing strategy needs to make the customer understand that the product they are offering is of superior quality than the product of competitors (Dietrich, Rundle-Thiele, and Kubacki 2017). So that whenever potential customer thinks of buying something the product offered by marketers is the only one which should come to their mind. For instance, some people do not the word noodles; they go to shops and ask of Maggi even though the market is full of similar products and services.

Products with a high number of alternatives in the market, it becomes important for marketers to make the customer understand that the product they are promoting is the best. In short, they have to make the product unique in the market. This is important as good positioning in the marketing mix leads to more customers and improves the financial viability of the company (Iyer, Davari, Zolfagharian, and Paswan 2019). While positioning the product in the market marketers need to understand the audience persona because they will be better able to cater to the needs of customers only after they fully understand the needs of customers. Furthermore, prices should be set according to what customers can afford and can also check the price of competitors with the substitute. The marketing mix can also use discounts to attract customers.

Apart from this, quality is another aspect of the product that should be determined in the positioning. Companies should try their best to deliver a high-quality product in the market. A product with provides better quality stays in the mind of the customer. Changes are also necessary for the positioning approach, because of changing customer needs. Products that are unable to change according to the customer needs to lack a competitive advantage in the market (Smigielska and Steganska 2017). Promotion is another activity which improves the sales of product by conveying the features and benefits of the products to customers.

STP for Strategic Implementation Solutions

Strategy implementation deals with the translation of a chosen strategy ineffective organizational action to realize strategic aims and goals. STP is used by organizations to align the deliverables to the needs and wants of customers. The prevalence of STP in business strategy is because it facilitates the development of solutions for strategic implementation issues by optimizing the utilization of firms finite resources and reducing the risk in determining when, how, where and to whom the products will be marketed (Olson, Slater, Hult and Olson 2018). It also helps to increase marketing competence by orienting the efforts, especially towards the targeted segment in such a manner that is consistent with characteristics of the market segment.

For instance, Marriott International, the biggest hotel chain in the world, owns different types of hotels that target certain customer groups. Courtyard by Marriott concentrates on travellers on the road who want a clean and nice place to stay during a trip, while Ritz-Carlton hotel targets individuals who are willing to pay a premium for luxury. On the other hand, Marriott ExecuStay hotel targets working professionals who need a comfortable place to stay for the long term. Marriott International does not communicate the same promotional message to its customers. Hotels are designed to cater to the needs and wants of a specific group. According to Hernandez (2019), 85% of the 30,000 new products launch in the US failed due to poor market segmentation.

This represents the problem of weak strategy in business. The strategy aims to create a roadmap with narrowed focus and broad buy-in. STP helps to formulate strong strategies by providing distinct milestones, a precise role for various stakeholders, and clear timelines. Moreover, strategic implementation issues involve ineffective allocation of resources, formulating functional polices, design structures, and leadership styles. STP informs businesses regarding value proposition, customer lifecycle targeting, customer experience requirements to formulate an appropriate marketing mix that facilitates optimal usage of resources and an efficient business approach to tackle a shortage of resources. STP also provides a systematic mechanism to adapt strategy in the internal and external environment and synchronized effort among leaders/functions in applying a strategy(Dibb and Simkin 2016).

Some of the real-world examples of effective segmentation include McDonald’s segmentation by age which uses different ads for different segments. While ads for quick breakfast are aimed at adults, Ronald McDonald’s segments target children. High prices also act as a barrier for effective strategic implementation, Mason, Kjellberg, and Hagberg (2018) stated that businesses can use STP to segment the market according to the income to target a segment which can afford the products and services offered by the company. For example, department store Neiman Marcus, Rolls-Royce and Rolex watch target upper-income market segment in their respective industry, while Wal-Mart is a successful example of marketing which focus on low prices and emphasizes the value for money. STP can be used for different types of strategies and is adaptable to different business needs to facilitate strategy implementation. Simply put, the STP approach improves the implementation of strategies by identifying niches with specific requirements, allowing marketers to mature markets to reach out to new clients and to deliver more focused and effective marketing messages.

Recommendations on Strategic Marketing

Based on the aforementioned review of segmentation, targeting, and positioning, the following management recommendations are made for informed decisions in the real world situation:

  • Do not define your market segments too broadly as it will provide an opening for market competitors who target more narrowly.
  • Manage market segments globally, as the regional focus can sometimes blindside business by a more global economy (Dietrich, Rundle-Thiele and Kubacki 2017).
  • Businesses should organize their operations by market segments. They can begin by establishing teams or groups that are market-focused that can get organized into a market-focused business model.
  • Complete research and analysis i.e. the strategic market segment portfolio then should have a bold approach towards attacking those segments.
  • Whatever approach businesses take to segment the market and to gain relevant data, segments should be fashioned according to the six key characteristics, namely, substantial, stable, actionable, identifiable, accessible, and differentiable (Dibb and Simkin 2016).
  • Substantial means that the target segment should be big enough to be profitable.
  • A market segment should be stable enough to be able to strategically market for a long period.
  • Being actionable entails the ability to provide services and products to the targeted segment.
  • Identifiable means that businesses should be able to measure and identify customer characteristics such as user behaviour and demographics.
  • Accessible means that the market segment should be accessible for distribution and communication.
  • Lastly, the target segment should have needs and desires that are different from other segments.

Conclusion on Strategic Marketing

In conclusion, the report suggests that no matter how small or large an organization is, and no matter what the specialism is, marketing planning should be based on customers. After all, in its essence marketing works to build long term relationships between customers and business. To be more customer-centric businesses can use target marketing that focuses on marketing efforts on a certain group of customers makes the pricing, distribution, and promotion of the products and services much easier and cost-effective. Within target marketing, the STP approach is used to select the most valuable segments most suitable for marketing objectives and to develop a product positioning strategy and marketing mix for each segment.

References for Strategic Marketing

Alsem, K. J. 2019. 25 years Marketing, and innovation.

Andaleeb, S. S. 2016. Market segmentation, targeting, and positioning. Strategic Marketing Management in Asia, pp.179-207.

Armstrong, G.M., Kotler, P., Harker, M. and Brennan, R.. 2018. Marketing: an introduction. Pearson UK.

Camilleri, M. A. 2018. Market segmentation, targeting and positioning. In Travel Marketing, Tourism Economics and the Airline Product (pp. 69-83). Springer, Cham.

Çengel, Ö. and Ledo Hernandez, D. 2019. Impact of analytics on strategic marketing performance.

Dibb, S. and Simkin, L. 2016.Market segmentation and segment strategy. Marketing theory: A student text, pp.251-279.

Dietrich, T., Rundle-Thiele, S. and Kubacki, K. 2017. Segmentation in social marketing. Springer Singapore:.

Dolnicar, S., Grün, B. and Leisch, F. 2018. Market segmentation analysis.In Market Segmentation Analysis (pp. 11-22).Springer, Singapore.

Ernst, D. and Dolnicar, S. 2018.How to avoid random market segmentation solutions. Journal of Travel Research57(1), pp.69-82.

Iyer, P., Davari, A., Zolfagharian, M. and Paswan, A. 2019. Market orientation, positioning strategy and brand performance. Industrial Marketing Management81, pp.16-29.

Mason, K., Kjellberg, H. and Hagberg, J. eds. 2018. Marketing Performativity: Theories, practices and devices.Routledge.

Olson, E. M., Slater, S. F., Hult, G. T. M. and Olson, K. M. 2018. The application of human resource management policies within the marketing organization: The impact on business and marketing strategy implementation. Industrial Marketing Management69, pp.62-73.

Palmatier, R. W. and Crecelius, A. T. 2019. The “first principles” of the marketing strategy. AMS Review9(1-2), pp.5-26.

Pooler, J. A. 2018. Demographic targeting: the essential role of population groups in retail marketing. Routledge.

Smigielska, G. and Stefanska, M. 2017.Innovative positioning as a marketing tool of retailers on the food market. Entrepreneurial Business and Economics Review5(1), p.77.

Remember, at the center of any academic work, lies clarity and evidence. Should you need further assistance, do look up to our Strategic Marketing Assignment Help

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