Mapping the Market: Segmentation, Targeting, and Positioning

Have you ever wondered how brands identify their ideal customers and create offerings that truly meet their needs?

This chapter introduces the segmentation, targeting, and positioning (STP) framework^[1]. By breaking the market into distinct segments, identifying the most promising targets, and positioning products or services to resonate with those audiences, organizations can create effective marketing strategies. The STP process not only helps businesses connect with the right audience but also ensures their offerings meet specific needs.

In this chapter, we will explore how organizations can effectively map their markets using segmentation, targeting, and positioning strategies to inform smart marketing decisions.

• Define market segmentation and targeting and explain their role in identifying and reaching specific audiences.
• Compare and apply common segmentation approaches, including demographic, geographic, psychographic, and behavioural methods, in both consumer and organizational markets.
• Use the ADAMS framework to evaluate the viability of market segments and distinguish among targeting strategies, such as undifferentiated, differentiated, niche, and micromarketing.
• Explain how targeting decisions influence the marketing mix by shaping product development, pricing strategies, distribution channels, and promotional efforts.
• Develop differentiation strategies that create unique value for customers in competitive markets.
• Create effective positioning strategies by analyzing competitive advantages and using tools like perceptual mapping.
• Integrate segmentation, targeting, and positioning (STP) principles to design comprehensive marketing strategies for tourism, hospitality, recreation, and service sectors.