The basic marketing principles are often forgotten
when it comes to starting up a business.
It will put you at a great advantage to take time to write a very basic
marketing plan. It will significantly
help in directing your focus as well as form strategies to reach the right
The STP process is a great place to start, even before your product or
service is marketed. STP stands for
segmentation, targeting and positioning.
Basically, segmentation is the way in which you recognize your
customers. Start by making a list of
every potential customer. Then, split
that list into smaller, more detailed segments. The best way to use segmentation is by starting out big. For example, put individuals in a different
segment than businesses. From that
point, continue dividing each segment further.
You may want to use demographics such as age, sex, location etc. Or, you might consider interests, hobbies or
group affiliation. The main goal is to
find commonalities in buying habits between your segmented groups.
Once you feel that everything has been segmented in just the right way,
take time to evaluate each segment. Try
to calculate the size of the segment, the likeliness of obtaining them and how
much they overlap from one to another.
Targeting is the next step in the process. Here you will make decisions about which segments to pursue. First, you will need to determine the size
of your market. Will you target a mass
market? Will you target a niche market? Basically, how large or small will your
segment be defined? Niche markets are
the smallest way to go, which means for less competition.
The two main considerations for choosing between market segments
are: recognizing the competition level
and knowing the prospective value of the segment. Everything that you do will be dependent on which segment is
chosen. It is wise to first evaluate
where you want your business to go.
The last step in the STP process is positioning. This will help you to define which method
youll use to position your product or service. There is another method to help develop this element: the 4Ps Product, Price, Promotion and
It is vital that the focus of your product follows the direction of
your selected target. Find out the
needs and wants of the people in your segment.
If you are marketing a product that isnt new, be confident that it fits
well within your target market.
The price you choose for your product or service is a very important
element. There are many factors that
must be considered. Youll want to
think about the meaning behind a price.
If it is too little, some might think that your product is cheap. Another factor is competition. It would be foolish to market a similar
product at the same price as your competitors, while directed towards the same
market. If you want a little assistance
in this area, there are entire books written on the subject. Also, avoid the cost plus profit margin
mentality. The best way is to evaluate
the price independently, while considering competition and value.
Simply put, promotion is the method in which you will deliver your
message about your product or service.
There are many methods to choose from:
Internet, commercials, radio, mass mailings or magazine
The last piece of the 4P method is place, which can also be referred to
as marketing channels. Place is the
technique used to bring your product to market. For example, who will sell your product and where will you sell
your product? Will your method be
strictly to the customer, or will you use distributors or retailers? Will you use the Internet alone to market
your product or will there be traditional methods?
This is a tried and true process that will allow you to organize the
plan in your head. Invest time in
identifying your strategies and goals on paper and it may help you to explore