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Saturday, May 22, 2010

Explain STP in Marketing - Market Targeting

Market Targeting is the process of evaluating each market segment’s attractiveness and selecting one or more segments to enter.

Evaluate the Market Segment

Evaluate whether the segment in which you are interested meets the four criteria for effective segmentation


1. measurable (we can estimate how many people or organizations are in the segment)

2. accessible (we can reach the segment through available means)

3. compatible (the segment is consistent with the overall goals of the organization)

4. substantial (the segment is large enough to justify our develop of products or services just for that segment)


Selecting Market Segment

a) Undifferentiated Marketing: It is a marketing coverage strategy in which a firm decides to go for the whole market with one offer.

Ex: Soft drink firms like Coke and Pepsi who retains the same flavor across segment.

b) Differentiated Marketing: It is a marketing coverage strategy in which a firm decides to target several market segments and designs separate offers for each.

Ex: Railway that differentiate its products in i.e. sleeper class, AC class

c) Concentrated Marketing: It is a marketing coverage strategy in which a firm decides to go with large markets share in one or few market segment.

Ex: Different car maker companies have some basic features and offer specific benefit to its buyers.

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