Target Marketing: Meaning, Process, Benefits

Target marketing involves the identification of the most profitable market segments. Therefore, businesses may decide to focus on just one or a few of these segments. They may develop products or services to satisfy each selected segment.

Such a target marketing strategy differs from mass marketing (where a company may decide to produce and distribute one product to all consumers) or product differentiation (where a company offers a variety of products to a large market).

Marketers have been moving away from mass marketing endeavors, as they are increasingly targeting smaller segments with customized marketing programs.

It clarifies how businesses could select the most profitable segments as they employ market coverage and positioning strategies to attract them.

Meaning of Target Marketing

Market targeting decides which market segment(s) presents a greater opportunity.

Also, positioning represents for each chosen market, develop market offering- the offering is market positioning in the minds of customers.

Market targeting means the process of evaluating the attractiveness of each market segment and selecting one or more segments to enter.

After a firm has identifies its market-segment opportunities, it has to decide how many and which ones to target.

A target market is a homogeneous (similar) group of customers to whom a company wishes to appeal. It is a picture of what a firm will do in some market. In target marketing, the marketing mix is tailored to fit some specific target customers.

Positioning is the act of designing the- company’s offering and image to occupy a distinctive place in the mind of the target market. The result of positioning is successful.

So we understand that;

  • A market is a set of all actual and potential buyers.
  • A target market is a group of people toward whom a firm markets its goods, services, or ideas with a strategy designed to satisfy their specific needs and preferences.
  • Any marketing strategy must include a detailed (specific) description of this.

Target Marketing Process – 3 Steps of Segmentation, Targeting, and Positioning (STP) Model

The target marketing process provides the fundation for selecting the target market – a chosen segment of the market that an organization wishes to serve. It consists of the 3 step process of (1) segmentation, (2) targeting, and (3) positioning.

3 Steps of Segmentation, Targeting, and Positioning (STP) Model

  1. Market Segmentation

The first step is market segmentation, which involves dividing a market into a distinct group of buyers with different needs, characteristics, or behavior who might require separate products or marketing mixes.

  1. Market Targeting

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

  1. Marketing Positioning

The third step is market positioning. Marketing positioning involves arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers, which is accomplished through formulating competitive positioning for a product and a detailed marketing mix.

The Target Marketing Process also is known as STP Model(Segmentation, Targeting, and Positioning).

Benefits and Importance of Target Marketing

Benefits of the Target Marketing Process are;

  • Understanding customers’ needs.
  • Suitable marketing mix.
  • Differentiation.

Understanding customers’ needs

The target marketing process provides a basis for understanding customers’ needs by grouping customers with similar characteristics together and for the selection of the target market. Segmentation allows marketers more precisely to define customer needs and expectations.

Marketers improve their understanding of how, why, and what influences customer buying. Being in touch with customers increases their responsiveness to changing needs and allowing better marketing programs.

Suitable marketing mix

This process allows marketers to understand customers’ requirements of a target market and design a suitable marketing mix that meets their needs. Hence providing effective and efficient matching of organizational resources to targeted segments and promising greater return on marketing investment.


Breaking a market into different segments allows marketers to decide which segment is more appropriate to differentiate their offerings from the competitors.

Market segments need to be protected from competitors. Otherwise, there is a threat that new entrants will establish a foothold and grow market share in a neglected, poorly served segment of a market.

Final Words

In target marketing, the seller divides the market into segments, chooses one or more of them, and develops products and marketing mixes most appropriate for each selected segment. For example, Colgate now produces toothpaste for the middle-aged buyers’ segment, which claims to prevent tooth decay.

It is impossible to appeal to all customers in the marketplace who are widely dispersed with varied needs. Organizations that want to succeed must identify their customers and develop marketing mixes to satisfy their needs.

We took a look at steps in the target marketing process, including how to divide markets into meaningful customer segments, evaluating each segment, deciding which segment(s) to target, and designing market offerings to be positioned in the minds of the selected target market.

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