STP. Part 1: Segmentation

enviro

This is a basic lesson on STP for the followers of this forum. STP is part of the foundation of any business. First is segmentation

Segmentation of the market is a large and complex area.

To successfully exploit a segment of the market, the segment must first meet certain criteria.

1. Identify and measure: What is the market? What is the size of it?

2. Access: Is it possible to communicate with the segment as a group? Can you get the product to them?

3. Size: The market segment must be big enough to be worth targeting.

4. Fit: Does the group have the same needs? The needs of the group must fit together.

5. Stability: The membership of the segment must be constant


1,2 and 3 are the most important.


*Following this the type of segmentation to be used should be established.


There are various ways to segment the market.


Geographic Segmentation
Depending on the type of product/service that is being provided, geographical location can be very important. The product/service may only apply to people living in certain locations or types of areas. For example, if you were selling GAA jerseys, there would be little or no demand for Cork jerseys in Dublin.

Demographic Segmentation
Most commonly used method of segmenting the market. Information is easy to come by and normally cheap or free.
Demographics can be divided into the following areas:

* Age
* Income
* Education
* Gender
* Social Class (Rich, Middle Class, Unemployed ect...)
* Sexual Orientation (Pink Pound)
* Occupation
* Religion
* Family Size


Psychographic Segmentation
This type of segmentation works by segmenting the market according to their personalities. For example: behaviour, interests, lifestyles and attitudes. The downside of this type of segmentation is access to information. It would normally require some primary research, which can be time consuming and expensive.


Behavioural Segmentation
This looks at the way consumers behave and can be a useful and reliable way of segmenting. Ask questions like: when is the product/service consumed and in what quantity.


Resources like the census and the CSO should be examined first and then move onto others after you have exhausted those.

steve_

Nice post!

bogwalrus

great post and answers the thread i submitted a few days ago. thanks