STP Marketing Strategy Essay

Paper Type:  Essay
Pages:  7
Wordcount:  1817 Words
Date:  2022-05-09
Categories: 

The STP marketing field and finally is a vast framework simplifying and summarizing market segmentation process. As a result, segmenting a market is the process where consumer groups within a specific market are segmented then profiled by some variables. These variables determine the characteristics of the market, tendencies and the taste and preferences of the consumers. The segmentation, positioning and targeting processes are components of chronological market segmentation order. Segmentation entails identification of the market that is to be segmented. This is by identifying, selecting and applying the bases used in the segmentation process besides developing profiles for the segments of the market.

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Targeting refers to the identification process of the segments that are most attractive from the stage of segmentation. In this stage, a firm or company will only choose or go for the segments that are most suitable for business in terms of profit. Positioning is the final stage that is more business-oriented. This is the stage where the company, firm or corporation assess the competitiveness regarding the advantages then position itself in the minds of the consumers to be the most attractive choice in the chosen categories of pursuit. This work discusses the STP marketing strategies that are commonly accepted, the limits of segmenting a market. To be precise, I caution on relying on the best-known STP strategy of marketing. Finally, this work discusses the best-recommended strategy to pursue when a company, individual or group has reached the limits of segmentation commitments and market segmentation.

The STP marketing technique entails segmentation commitments at brand levels; however, the STP marketing strategies do not prolong the efforts at the corporate stage to catch several segments in the market. Therefore, firms and corporations can apply either the concentrated STP marketing strategy by issuing single brands to precisely more than one segment or a differentiated marketing STP where they attempt to capture various market segments through targeting different brand for each segment. An example of companies is the Rosewood Hotels &Resort and Crystal Cruises that have a small focus on luxury seeking segment, which exemplifies the strong STP strategy. These hospitality companies like Choice Hotels Int. Focus on numerous target segments having many diverse brands thereby using the differentiated STP strategy of marketing. These brands include the Econolodge, Clarion, Cambria Suites, Ascend collection and Comfort Inn. Another company that applies the differentiated STP strategy of marketing is the Carnival Corporation that targets numerous segments of cruise market with the company's family brand. These segments include the Cunard, Carnival, Princess, Seabourne and Holland America. As a result, as the STP strategy imposes limits on the brand strategy, it does not prolong different ambitions and corporate strategies.

Market Segmentation and Selection of Market Segments

There is more than one method of segmenting a market. One may decide to differentiate his or her customers according to various demographic variables like gender, age, income, and education. Another method is by segmenting according to geographic variables like state, region, nation and type of neighborhood as purchase frequency, media habit, and channel usage and brand loyalty. In the current business world, the schemes of segmenting a market have become more sophisticated by the application of numerous segmenting variables and advanced statistics. For instance, Nielsen Claritas applies the demographic, geographic and the behavioral data to segment the United States Household into PRIZM segments. Claritas gives the segments names like "Country Squires, Money & Brains, and Blue Blood Estates." Claritas defines the money & Brain as the residents with high incomes, advanced degrees who have a sophisticated taste that matches their status. Many City dwellers of this type are predominantly white people with Asian-American concentration married with few kids and live in fashioned manicured lots and residential. As a result, one can identify the kind of segment that is of interest for a business venture or pursuit. The Claritas' PRIZM divides the market into 66 various entities. However, if an individual decides to start a business, he or she should define the segment so tightly. The common characteristics marketers usually look for are accessibility, actionability, sustainability, and measurability. Under measurability, the marketers understand the size, characteristics of purchasing and the value requirements of certain segments. Accessibility entails an efficient and effective communication ability with the segment. Sustainability is how profitable the segment chosen will be different from other market segments and maintain the business value offers.

The final part of is the action part that is the ability of a company to establish a competitive advantage in terms of what it offers to a certain market segment. However, when it comes to individual choice when it comes to which variables to use in segmenting the market, there is no precise answer since it depends on the type of business or company, the market and finally the consumers. As a result, different types of markets are segmented using different variable types with a different number of segments. Thus, a pre-existing STP generic segmentation of markets sold by a research firm might not be ideal for your business or company. For this, I encourage people, corporations and firms should commission segmentation research for one's specific market beginning with many variables, analyzing them and winnowing the variables gradually to see the one's grouping of consumers or producing segments will be more useful to the business.

The main factor one should consider in segments is that the groupings must contain customers who are similar and distinct from other segments concerning their response to your projected market appeals and offerings. Besides, different market segments ought to differ in a manner that will enable the size and factor of accessibility be measured, should be large to justify efforts of separate targeting, reachable through communication channels and other forms of marketing media. Besides, the segments should be stable and do not diminish size over time.

Since the STP marketing strategy is for one to conduct your study, many market segmentations are not available to the public. Therefore, a useful segmentation, for instance of a restaurant (serving industry) is first identified by the number of attributes attached to restaurants like a good place where people meet, friendly service, consistent food quality from visit after visit, lively upbeat neighborhood, convenient location and finally attractive waitress and waiters. After that, they asked some sampled customers to rate. The respondents rated the importance of every attribute of the restaurant and their concurrence with lifestyles like "I love to cook, I never seem to have enough money, and I look to meet many people." As a result, these data were analyzed by the application of statistical technique referred as cluster analysis to find the segments of customers with relative perceptions of that ideal restaurant that is still in theory. However, Swinyard and Struman did not say about the type of statistical analysis used, but from their data, it was clear that they applied the cluster analysis since it was performed on the ratings for the attributes that performance differed among the restaurants that existed in the market. In my opinion, the authors used this kind of technique because of the large and well-defined clusters. The second reason is that the attributes on which the restaurants perform well do not lead to consumers choosing a particular restaurant over the other despite the importance of the characteristics.

As a result, it is essential to understand that one should select the clustering variable measure that depicts the reason why consumers cane prefers your restaurant to the others in the market. After the identification of segments with analysis of clusters, they also compared various groups on lifestyle factors demographic variables and restaurant patronage patterns that are represented in table 1. Despite Swinyard and Struman omitting the statistical results in their research, by the available information, it appears that it was a good segmentation of the market since the segments differed from each other regarding restaurant patronage characters and the actionable motivators to customer's choice among the restaurants in the market. Another reason is the sizes of segments were measurable from the sample size in the survey.

The third reason that makes their segmentation of the market good is that the segments were substantive regarding sharing of dollars to warrant targeting and patrons. However, these segments would have been more comprehensive if there was an application of a different pattern of media usage and dispersions in geography that would enable the restaurants to be cost-effective regarding communications and the differences between the segments are not adequate to lead marketing decisions. For efficient delivery of appropriate marketing segmentation, it is essential to hire expertise in marketing since from the research segmentation strategy used by Struman and Swinyard is not adequately capable.Once the identification of market segments, one will be able to make a decision based on the preferred ones and those disregarded. However, some marketers offer different advice on the criteria one should apply when deciding on the segments despite an overwhelming fact that the most attractive segments are those that are relatively inexpensive to attain with marketing efforts, have strong growth potential and sales. The other fact is that a good market segment viewed by weak or few competitors, and satisfies the needs of the corporation or firm's resources.

On an actual point of view, if one is to open a restaurant or food industry in a market studied by Struman and Swinyard, entering that kind of market (on the family dinner segment) one could prosper. Besides, one can find the most significant success since it spends a lot on dining outs and has the highest number of restaurant loyalists. In addition to this, the sector has the fewest number of competitors thus penetrating in such an environment would be easy. One critical aspect that I recommend to people in business is that when choosing a market segment, one should go for the segment that fits their personality that will ease their relationship with customers. Therefore, for the success of the business, the character and personality play an important part in target segment selection. A consideration about segments, in general, is that it is unpredictable that one segment can be superior to the other on all standard criteria. This implies that selecting a segment entails a mixed view that there are no common metric assisting people to compare the segments across various criteria. As a result, this makes the selection of segments to be more scientific. However, one should consider the importance and size of the segments across various criteria when making an overall evaluation of the effectiveness of the segments.

Cons of the STP marketing

Market segments are discovered but not created, a fact that obscures a tendency of segmenting the market by the by-product categories of a company or market. In the hospitality industry, this can be illustrated by categorizing the segments regarding extended- stay hotels or the all-suite instead of segmenting according to the customer expectations and characteristics that will...

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STP Marketing Strategy Essay. (2022, May 09). Retrieved from https://proessays.net/essays/stp-marketing-strategy-essay

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