What is STP (Segmentation, Targeting, Positioning)?

STP is one of the most fundamental marketing frameworks taught in every MBA program. Segmentation can be based on demographics (age, income), psychographics (lifestyle, values), behavioral patterns (usage frequency, brand loyalty), or geographic factors. The goal is to identify segments with distinct needs that justify different marketing approaches.

Targeting involves evaluating each segment's attractiveness (size, growth, profitability, accessibility) and selecting which segments to pursue. Companies can use mass marketing (one approach for all), differentiated marketing (different approaches for different segments), concentrated marketing (focus on one niche), or micromarketing (customized for individuals).

Positioning is how you want customers to think about your brand relative to alternatives. A positioning statement typically follows: "For [target segment] who [need], [brand] is the [category] that [unique benefit] because [reason to believe]." The positioning should be distinctive, credible, and sustainable. In case interviews, STP analysis is essential for any marketing or market entry case.