University of Northampton MKTM028: Marketing Management and STP

This essay provides a comprehensive analysis of marketing management, with a specific focus on segmentation, targeting, and positioning (STP) strategies. It begins by introducing the evolving nature of marketing in the contemporary business landscape, highlighting the increased competition and the need for innovative marketing approaches. The essay delves into the core components of STP, including segmentation based on demographic, geographic, psychographic, and benefits sought variables. It then explores targeting strategies such as cost leadership and differentiation, emphasizing the importance of aligning these strategies with the preferences of the target market. Positioning is also discussed as the final element of STP. The essay uses real-world examples to illustrate the application of STP across different industries, identifies gap areas, and offers recommendations for improvement. The assignment is based on the University of Northampton MKTM028 Strategic Marketing module.

Running head: MARKETING MANAGEMENT
Marketing management
Name of the student
Name of the university
Author note

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Introduction
In the current business scenario, marketing management concept is much more diverse
and complex that it was a few years ago. This is mainly due to the reason that competition is high
in the current time with the presence of number of players operating in different business sectors.
Thus, with the increase in the competition in the market, companies are initiating distinctive and
innovative marketing strategies to stay ahead in the competition. However, on the other hand, it
should also be noted that prior to the initiation of the different marketing activities, the target
market should be properly identified due to the reason that different customers are having
different sets of preferences and requirements. Therefore, it is important for the business
organizations to identify the exact customer segments in accordance to their product and service
offerings.
On the other hand, segmentation of the customers involves different concepts and steps,
which should be maintained in a sequential manner to have the positive and favorable outcome.
This includes segmenting, targeting and positioning. Each of these elements are being done in
segregating the target customers based on different variables and designing approaches
accordingly. It should also be noted that effectiveness of the segmentation, targeting and
positioning is also depended on different situations and the extent to which the organizations are
implementing the strategies effectively. Different business organizations are having different sets
of business environments and thus they are following different approaches in respect to the
segmentation, targeting and positioning.
This essay will discuss about the effectiveness of segmentation, targeting and positioning
in different situations and how they can be aligned in different situations in terms of their

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variables. In addition, a few practical and real world examples will also be used to identify the
differences in implementing the segmentation, targeting and positioning elements along with
identifying the gap areas. Recommendations will be discussed in accordance to these gap areas
in this essay.
Segmentation, targeting and positioning
In segmenting the customers, targeting and positioning elements are also being included
due to the reason that segregating the customers on the basis of different variables will serve the
primary purpose of differentiating the customer sections. However, it is also important to design
the strategies for targeting the segmented customers. These strategies will also be different and
diverse based on the trends of the segmented customer sections. Moreover, positioning is also
important due to the reason that based on the trends of the segmented customer sections; brand
and offerings should be positioned. This positioning should also be done based on the taste and
preference pattern of the customers. For instance, in the case of the luxury customer segments,
lifestyle positioning is important to attract more customers. Thus, it can be concluded that each
of these three elements are important in initiating the segmentation strategies properly. The
following sections will discuss in detail about each of these elements.
Segmentation
Segmentation is the primary element in the entire process. This refers to the process of
dividing the different customer sections based on different variables. This is being done in order
to identify the particular customer section in accordance to the offerings of the organizations.
According to Venter, Wright and Dibb (2015), segmentation should be done from the
perspective of the customers. This is due to the reason that in the current marketing scenario,

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taste and preference pattern of the customers should be given the major focus in segmenting
them, which will help the marketers in designing their offerings accordingly. Moreover, the
authors have also stated that segmenting on the basis of the requirements of the customers will
help the organizations in meeting the expectations of the customers properly and effectively.
Thus, it can be concluded that segmentation on the basis of the benefits sought by the customers
can an effective choice in segmentation.
However, on the other hand, there are number of opposite views also being identified
where the different other variables of segmentation are given importance. Schlegelmilch (2016)
stated about the other major ways or processes of segmentation. According to the authors, all
these models are effective in different situations. One of the major variables of segmentation is
demographic segmentation. This refers to the process of segmenting the customers on the basis
of age, income and genders. Thus, demographic factors are used as the segmenting factors. One
of the major advantages to be gained by initiating the demographic segmentation is convenience.
This is due to the reason that demographic factors are relevant in any market situations and thus
the marketers can initiate the segmentation strategies accordingly. However, on the other hand,
Khoo-Lattimore and Prayag (2015) stated that initiation of demographic segmentation will also
prove challenging for the business organizations. This is due to the reason that basic
segmentation can only be done on the basis of demographic factors. In addition, demographic
segmentation will not enable the organizations in segregating the customers on their benefits
sought. For instance, segmenting on the basis of the demographic factors will not help the fast
moving consumer goods manufacturers in identifying their target customer segments. This is due
to the reason that based on the age group, they have identified a target group but among this
group there are customers with different benefits sought and behavioral factors.

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Another major variable of segmentation is geographic segmentation. This refers to the
division of the customer sections on the basis of their geographic presence and areas. According
to Sair (2014), geographic segmentation is mainly applicable and effective for the multinational
organizations due to the reason that they operate in different regions across the world. With the
help of the geographic segmentation, multinational companies are segregating the customer
bases on the basis of regions of their origin. For instance, Unilever is having certain product
portfolio for the Indian subcontinent and European markets. This is beneficial for the
multinational organizations due to the reason that they can offer products according to different
taste and preference pattern of the customers from different regions. However, on the other hand,
it is stated by Nella and Christou (2014) that even though the geographic segmentation can be
beneficial in different cases but it not having holistic benefits for the organizations and not all the
organizations are having these benefits. This is due to the reason that customers from same
geographic areas may have different taste and preference patterns that will pose issues for the
marketers. In this article, the authors have given the example of wine industry where it is stated
that taste and preference of the customers in terms of wine can be different irrespective of their
same geographic areas.
Apart from the popular segmentation variables such as demographic and geographic
segmentation, there are number of other variables also being practiced by the marketers such as
psychographic segmentation. Tupikovskaja-Omovie et al. (2014) stated that psychographic
segmentation is applicable mainly in the luxury commodity markets. This is due to the reason
that psychographic segmentation refers to the factors such as lifestyle patterns and activities.
Thus, companies operating in the sectors such as luxury and higher end products are
incorporating this variable, which is helping in targeting the customers based on their

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preferences. The authors have also stated that psychographic segmentation is more based on the
preferences of the customers over the other segmentation variables discussed. However, in this
case also, there are number of challenges that will be faced by the organizations. As per Canhoto,
Clark and Fennemore (2013), initiation of psychographic segmentation strategy will be complex
for the marketers due to the reason that it is difficult for the business organizations in offering
different products and services on the basis of different psychographic preferences of the
customers and it is also difficult for the organizations to maintain the diverse portfolio.
The above discussed segmentation variables are traditional mode of segmentation
strategies and in the current time, benefits segmentation is being more practiced. This refers to
the segmentation of the customer bases on the basis of the benefits sought by the customers.
According to Gad Mohsen and Dacko (2013), benefits segmentation is the most effective forms
of segmentation for the contemporary business firms. This is due to the reason that with the help
of these variable, business entities can target the customer sections based on the particular
benefits served by the products. The authors have given the example of organic food, which can
be consumed by the customers across countries and income levels with only the requirement of
preferences for organic consumption. Thus, organic food manufacturers can segment the
customer base on the basis of the benefits offered by their products. This will help them to target
the specific customers across the world and across different demographic factors.
Targeting
Next to the segmentation, targeting is important to consider in catering to the segmented
customer bases. Targeting refers to the process of initiating different approaches to attract the
customers segmented. After the segmentation of the customers, it is important for the marketers

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to initiate the targeting strategies due to the reason that segmented customers will not get
attracted without initiating strategies to cater them. This should also be noted that targeting
strategies should also be based on the trend of the segmented markets in order to have the higher
level of attraction among the segmented customers. According to Khan (2013), there are mainly
three types of targeting strategies can be initiated, which includes cost leadership, differentiation
and market focus strategies. Each of these strategies is applicable for d3ifferent types of
customer segments and in accordance to their individual choices. The author has also stated that
it is important for the business organizations to align their targeting strategies in accordance to
the target market preferences due to the reason that the more effective will be the targeting
strategies, the more will be the efficiency of them in catering to the segmented customers.
According to Zehir, Can and Karaboga (2015), differentiation strategy is one of the most
common and used targeting approaches. This refers to the initiation of the unique and distinctive
approaches, which will be different from that of the competitors and will be able to stay different
among the presence of substitute products. As per the authors, this strategy can be effective in
the current business scenario due to the reason that competition is high and threat of substitute
products is also high. In this case, initiation of the differentiation strategy will help them to fend
off the competition and to enhance value proposition for the customers. It is also being stated by
the authors that in the case of the differentiation strategy, pricing factors are given less focus and
thus it helps the business organizations to have more profitability from their sales.
On the other hand, it is stated by Huo et al. (2014) that cost leadership strategy can also
be effective enough in targeting the segmented customers. This is due to the reason that price
was and will always be the most important determining factor for attracting customers. This
strategy refers to the process of reducing the cost of operation and offering the final products in

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competitive pricing. Thus, lower pricing compared to the competitors will help in covering larger
segmented customer sections and getting the maximum sales volume. However, Semuel, Siagian
and Octavia (2017) stated that initiation of cost leadership strategy will be effective only when a
certain factors can be considered. One of these factors is reduction in the cost of operation. This
refers to the fact that reduction in the cost of production will only enable to offer the competitive
end prices to the customers. This is important to consider due to the fact that offering minimal
pricing with having similar cost of production as others will affect the profitability and business
viability in the long term. In addition, Teeratansirikool et al. (2013) stated that initiation of cost
leadership strategy is not applicable in every business sectors rather they are can effective for
lower end sectors. This is due to the reason that in the case of the higher end market of luxury
goods, initiation of cost leadership strategy will cause reduction in the brand value. Customers
will perceive lower and inferior quality with the lower pricing.
The last targeting strategy that can be initiated is market focus strategy, which refers to
the strategy of identifying a single market segment and offering products according to their taste
and preference pattern. According to Urde, Baumgarth and Merrilees (2013), initiation of the
market focus strategy will be effective for the niche brands due to the reason that it is easier for
them to target a particular section and offer products accordingly. However, on the other hand, it
will be difficult for the mass market brands to initiate market focus strategy. This is due to the
reason that they are catering to large number of customer segments and each of them is having
different sets of preferences, which cannot be met with market focus strategy. Thus, market
focus strategy is having very limited exposure and usage in the market.

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Positioning
The last element in the entire process of STP is positioning, which refers to the process of
creating competitive position in the market and accordingly in the mindset of the targeted
customers. According to Maarit Jalkala and Keranen (2014), positioning strategies are also based
on different factors and these helps in creating the favorable impression in the target customer
segments. One of the major positioning strategies being practiced is positioning on the basis of
the benefits for the customers. This is much effective due to the reason that for the segmentation
based on the benefits sought, positioning accordingly will help in having maximum outcome. On
the other hand, it is also being stated by the authors that positioning strategies should be done in
accordance to the segmented market and targeting approaches. This will ensure the maximum
favorable results from the process.
Application of the segmentation, targeting and positioning strategies
Effectiveness and relevancy for the segmentation, targeting and positioning strategies can
be identified on the operations of the large business organizations. For instance, Apple follows
psychographic segmentation and geographic segmentation strategies. This is due to the fact that
with the help of the psychographic segmentation, they are catering to the customers with having
the preferences for innovative and class leading products along with having higher social values.
On the other hand, with the help of the geographic segmentation, they are catering different
regions with different product strategy. For instance, Apple is more focused on selling their low
cost models such as Iphone SE and 5C in the developing markets and Iphone X and XS in the
developed countries. This is in terms to the market trends in different regions.

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It is also identified that The Body Shop is a leading brand, which is using demographic
segmentation. This is due to the reason that with the help of the demographic segmentation, The
Body Shop is offering specific products for female and male segments. In addition, they are also
offering products specific to different age groups. For instance, they are having baby care
products for the age groups below 10. Thus, it can be concluded that segmentation should be
initiated based on the nature of products and customer segments. On the other hand, Apple is
following differentiation strategy for targeting the customers. Thus, the products of Apple are
differentiated in terms of software, aesthetics and utilities. This is also further helping Apple in
pricing premium for their differentiated features. Positioning strategy of Apple is based on the
social factors due to the fact that customers perceive Apple as premium brand and thus premium
pricing is being initiated. With the help of the higher end pricing, Apple is maintaining their
exclusive product position in the market. The more will be the price, the more premium
positioning can be gained.
Recommendations
It is recommended that each of the business organizations should have integrated process
of segmentation, targeting and positioning. This is due to the reason that integrated process will
be beneficial in having maximum alignment with the business objectives. Moreover, it is also
recommended that segmentation, targeting and positioning should be initiated as the primary
process over other activities. This will help in having the marketing activities in accordance to
the trend and preference pattern of the segmented customers. Contemporary business
organizations should also be targeting more than one customer segments. This is due to the
reason that current competitive scenario is having the presence of number of players and
targeting one customer segment will not be a viable option. Thus, they should target more than

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one customer segments and different targeting and positioning strategies should be initiated.
Process of segmentation and targeting will only be effective and successful when the
organizational objectives will be aligned with that of the market trends. This is due to the reason
that current market trend is rapidly changing and it is important for the businesses to cope up
with the change and initiate the segmentation and targeting strategies accordingly.
Conclusion
It can be concluded that segmentation, targeting and positioning strategies are the basic
and foundation of initiating marketing activities. Hence, it is important to identify the targeted
segment and position the product accordingly prior to the initiation of other marketing activities.
In this essay, the effectiveness of the segmentation, targeting and positioning is being discussed
along with the different variables of them. It is identified that each of the variables and types of
segmentation, targeting and positioning strategies are applicable for different situations and
different organizations. Moreover, this essay also discussed about the real world examples of the
organizations, which have initiated different variables of segmentation, targeting and positioning
strategies. It is identified that approaches in regards to the segmentation and targeting are
depending on the nature of the products being offered. However, a few recommended steps are
also being identified that will help in mitigating the current gap areas and enhances the
effectiveness of the entire process.

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