How to Apply STP Marketing: A Worked Segmentation, Targeting, and Positioning Plan
Shusaku Yosa
STP connects segmentation, targeting, and positioning: understanding differences in a market, choosing whom to serve, and deciding what customers should associate with your offering. Filling in three labels is not enough. A useful plan explains the evidence, the customers you will initially exclude, the value you can deliver, and the first action that will test your assumptions.
Define the decisions and the finished worksheet
Start with a small, usable output rather than an elaborate persona or a polished positioning map. The three decisions should fit together, but the process can move backward. Discovering an expensive service requirement may lead you to revise the segment or your promise.
Decision | Question | Output |
|---|---|---|
Segmentation | Which needs or buying conditions differ? | Grouping criteria and evidence |
Targeting | Where can we deliver worthwhile value? | Selection and exclusion reasons |
Positioning | Why should this customer choose us? | Benefit, alternatives, and supporting evidence |
A detailed demographic profile is useful only when those details affect the decision. An invented age or job title does not establish a customer need. Record what is known and what remains a hypothesis.
Research needs before choosing a grouping
Use interviews, inquiries, purchase conditions, and usage records to understand the task customers are trying to complete. A page view is observed behavior; a strong preference for that feature is an interpretation that still needs checking. Include people who considered the offering but did not buy.
The worked example below is a fictional B2B reporting service. Research would examine reporting frequency, current tools, approval steps, implementation authority, and the work that creates delays. These are research questions, not claims about a real market or a particular software product.
Segment where the response or service should differ
Suppose the research suggests three situations: teams repeating a standard report every month, teams whose reports change by project, and teams whose reporting is already standardized. The relevant questions differ: reducing repetition, preserving flexibility, or justifying a switching cost. Grouping is useful when it changes the offer or the way you deliver it.
Do not subdivide until every customer is alone. Separate campaigns and service processes have costs. OpenStax discusses practical criteria for effective segments, including whether they can be reached, distinguished, measured, and served. Use those questions to test a grouping, rather than treating an acronym as proof that the market has been understood.
Select a target and record whom you will not serve
Compare customer need with reach, delivery costs, and your capacity. In the fictional example, small teams producing repeatable monthly reports are the initial target. Complex consolidated reporting is excluded because the assumed service cannot yet support its requirements.
Candidate | Main issue | Initial decision |
|---|---|---|
Small teams with repeatable reports | Repetitive work; limited staff | Trial candidate; confirm authority and switching effort |
Project-based reporting teams | Changing formats and workflows | Investigate support cost before selection |
Complex consolidated reporting | Extensive control and integration needs | Outside the present delivery scope |
These judgments are hypothetical. Writing down exclusions helps sales and delivery avoid making incompatible promises. Target-market selection can involve one, several, or broad groups; a narrow target is not automatically the best choice.
Write a promise supported by evidence
“Convenient and high quality” does little to distinguish an offering. A more testable statement might promise a clearer recurring reporting process for small teams, supported by a demonstrated workflow and an appropriate support arrangement. Separate the intended benefit from evidence that you can actually provide it.
An empty area on a positioning map does not establish demand or profitability. Price is also a legitimate choice criterion. Positioning concerns the value and reasons for choice, not a requirement to avoid price competition in every market.
Translate the plan into an offer and a first test
For the fictional service, align the trial, support scope, pricing assumptions, channel, and message with the selected reporting task. A focused target followed by a generic campaign for everyone is an inconsistent plan. Test the same reporting task before and during a trial, documenting errors and support effort as well as time.
- Record why people decline the trial or purchase.
- Set a review date and define which evidence would change the target or promise.
- Change a clear assumption, rather than adding unrelated features after every comment.
Use segmentation versus targeting for the grouping and selection details, STP applied to OMO for a store-and-online example, and one-to-one marketing when considering ongoing customer relationships.