STP Framework
The logical sequence for defining your audience and competitive position.
Marketing can't be everything to everyone. STP is the process that forces strategic choices: which customers matter most, which segments you'll pursue, and how you'll differentiate. It's the bridge between understanding your market and building a strategy. A logical sequence—not steps you skip.
Segmentation
Divide the total market into distinct groups of customers with similar needs, characteristics, or behaviors.
You can segment by demographics (age, income), psychographics (values, lifestyle), geography (region, urban vs. rural), or behavior (usage rate, loyalty). The goal is to find meaningful differences—groups that respond differently to marketing efforts.
Targeting
Evaluate each segment and decide which one(s) to pursue. Choose where you'll compete.
Not all segments are worth pursuing. You evaluate based on size, growth potential, competition, alignment with capabilities, and profitability. Targeting is where strategy happens—it's saying "yes" to some customers and "no" to others.
Positioning
Define how you want your target segment to perceive your brand relative to competitors.
Positioning is the mental space you own. It's the reason a customer chooses you over alternatives. You craft this through product features, messaging, pricing, and brand associations. Positioning isn't what you say—it's what customers believe.
STP is sequential because each step builds on the last. You can't target before you segment. You can't position before you target. It's a forcing function for strategic clarity.
In 1967, he published "Marketing Management: Analysis, Planning, and Control," which became the most widely adopted marketing textbook in business schools worldwide. While the first edition had little emphasis on segmentation, targeting, and positioning, Kotler's subsequent editions synthesized these concepts—drawing from Wendell R. Smith's segmentation work and the positioning ideas of practitioners like David Ogilvy and, later, Ries & Trout—into the unified STP framework.
Kotler's contribution wasn't inventing segmentation or positioning—it was making them systematic. STP became the template for strategic marketing planning: a sequential process that forced discipline and could be taught, tested, and replicated. The framework spread globally through his textbook, which has been updated through 15+ editions and remains the standard curriculum in marketing education.
Late 1960s America: Markets were becoming saturated. The post-war manufacturing boom had created product proliferation. Customers faced overwhelming choice. Mass marketing—trying to sell to everyone—was losing effectiveness. Companies needed a way to focus.
The Rise of Market Research: Consumer research was maturing. Companies could now segment markets with data—demographics, psychographics, behavioral patterns. But having data isn't the same as having strategy. STP provided the process for turning insights into action.
Competitive Intensity: As categories matured, differentiation became survival. You couldn't just be "a car company" or "a soap brand"—you needed to own a specific position in customers' minds. Ries and Trout's positioning work made this explicit: perception is reality, and you need to actively manage it.
Why It Endures: STP remains the foundation of marketing strategy because it forces the hard choices that weak strategies avoid. Who are we for? Who are we not for? What do we stand for? These questions are timeless. The framework survives because human attention remains scarce and competitive.