How to Conduct an STP Analysis for Starbucks



Introduction to STP Analysis

Segmentation, Targeting and Positioning (STP) Analysis is an essential tool for developing and executing effective marketing strategy. It is used to identify and break down market segments into smaller ones that an organization or business may better serve. By understanding the segments, companies can target their products and services at the needs of specific customer groups in order to position them more effectively in their markets. When a company employs STP, it begins by analyzing its potential market segments, selecting which ones it will target with its offerings, and then positioning those offerings appropriately to meet the needs of the targeted customers.

STP analysis involves five main steps:

  1. Market Segmentation – Identify market segments through research consisting of gathering data on potential customers’ needs and wants.
  2. Target Market Selection – Choose a segment or segments out of all that were identified as most suitable for targeting product/service offering based on insight into customer behavior and preferences determined through initial market segmentation research process.
  3. Product-Market Fit – Analyze the company’s offerings in order to determine if there is a perfect fit between what the company has to offer (product/service features) versus what each target segment requires from such offering (benefit needs).
  4. Positioning Strategy – Develop positioning strategies for each identified target market based on insights generated from previous steps taken within STP process – product/market fit plus drive brand message/value allowing customers recognize differentiating factor making company stand out from its competitors within each target group analyzed before decision on implementing particular business strategy was made originally by top manager(s).
  5. Monitoring & Review – finally there should be established process of constantly monitoring performance results achieved through implementation chosen strategies within each selected target market so possible modifications could be done according feedback given either buyers or marketplace itself upon condition team responsible handles these activities correctly basing decisions they make upon valid data collected while using appropriate tools developed precisely delivering such set goals successfully [1].

Defining the Market

STP analysis is an essential part of any business strategy and can be applied to Starbucks to determine the best way to target their customers. The STP analysis consists of three main steps: Segmentation, Targeting, and Positioning.

In this article, we will focus on the Segmentation step which is used to define the market. Through segmentation, we can identify the different groups of customers and determine their needs, wants, and preferences.

Identifying the Target Market

In marketing, target market (sometimes referred to as target audience) is a group of customers who are identified as likely purchasers of a product or service. It involves segmenting the market based on various factors such as demographics, purchasing power, lifestyle, and buying habits. Knowing the target market helps marketers tailor their marketing strategies and techniques according to their needs and preferences.

Identifying the target market for Starbucks involves analyzing the internal and external environment (e.g., competitors’ tactics, customer demographics, etc.) of the company. The exercise will help to identify its potential customers and what kind of messaging should be used across different communication channels in order to effectively reach them.

STP analysis (segmentation-targeting-positioning) is a useful tool for understanding how to better identify Starbucks’ target market through segmentation so that it can then focus its efforts on addressing their wants and needs with an effective positioning strategy. STP should be conducted in three primary steps:

  1. Segmentation: Divide the larger population into smaller groups based on various factors such as age, gender, location, income level etc., that characterize your desired customer profile
  2. Targeting: Select specific segments for which you plan to develop your product or service
  3. Positioning: Establish your unique position within each selected segment by creating messaging tailored specifically for them

Through STP analysis Starbucks is able to better define its ideal customer profile in order: (1) to identify existing opportunities in untapped markets; (2) develop strategies customized for its core customers; (3) adjust its approach so that it remains competitive against rivals; and (4) ensure that it continues to retain current customers while attracting new ones through targeted campaigns tailored specifically towards their interests and demographics.

Understanding the Target Market

A thorough STP (Segmentation, Targeting and Positioning) analysis often forms the backbone of any business’s marketing strategy. It helps businesses better understand their brands’ strengths and weaknesses, as well as identify potential opportunities in untapped or emerging markets. Starbucks is one such brand that has implemented an effective STP strategy over the years to continue to engage customers and remain on top of the competition.

When designing its STP strategy, Starbucks is considerate of Segmentation, Targeting, and Positioning. Through segmentation they define their target market – who they should be aiming their campaigns at to attract maximum customers. For Starbucks it includes focusing on gender, age group of customers, geographic location and lifestyle preferences.

Targeting involves evaluating potential customer segments for suitability; whether or not it meets the brand’s ideal customer criteria (i.e tastes/preferences) but also serves practical considerations such as accessibility from a geographic standpoint, ability to purchase their products based on financial ability etc. Lastly positioning involves creating a marketing message that speaks directly to audiences within the target market segment ensuring that a deep connection is formed with influential audiences in order to drive loyalty as well as create evangelists for the brand – both important components for successful growth especially in today’s environment where social media gives more power than ever before for consumers when choosing which brands to support or actively avoid.

Ultimately through an effective STP analysis backed by sound research across key markets around the world companies like Starbucks are able to keep current customers around while actively engaging new ones under tighter control than ever before allowing them more degrees of freedom when operating globally while minimizing risk and maximizing opportunities – shaping tomorrow’s culture through quality coffee products today!


Segmentation is an essential part of the STP analysis. It is the process of dividing the market into manageable segments which can be used to identify target customers and their needs. Starbucks uses demographic, geographic, psychographic, and behavioural segmentation to identify potential customers.

Let’s take a closer look at how Starbucks applies segmentation in order to better target potential customers:

Identifying Relevant Segments

When it comes to conducting an STP analysis for Starbucks, the first step is to identify relevant customer segments. Customer segmentation involves the establishment of different groups or segments of customers that share similar characteristics, such as demographics (e.g age, gender, income), psychographics (values, lifestyle needs), and/or behavior patterns (usage rate/frequency of products).

The benefit of identifying relevant customer segments is that it allows companies like Starbucks to develop an effective marketing mix and reach out to target customers in a more cost-effective manner. In other words, targeting specific types of customers means they don’t have to spend time and money airing commercials on television or radio programs that are not relevant to them.

Furthermore, by investigating customer preferences, needs and wants through market research efforts such as surveys and focus groups supports organizations like Starbucks in creating suitable products & services tailored for specific types of customers.

Evaluating Segments

Evaluating segments is an essential step in STP analysis which allows marketers to identify target markets to prioritize, what strategies to use and how to allocate resources appropriately. The evaluation process should consider the size and growth of the segment, its profitability and consistency with the firm’s objectives.

The key aspects that need to be taken into account while evaluating a segment include:

  • Size: How many people are there in the selected segment? Is it large enough for Starbucks to make profits?
  • Growth Potential: What is the potential rate of growth for this segment? Does it offer a good long term business opportunity for Starbucks?
  • Accessibility: Is it easy or difficult for Starbucks to reach out to this segment online or through traditional channels such as stores, print media and radio etc?
  • Profitability: Can Starbucks make returns by providing products/services tailored specifically towards this segment’s needs?
  • Competitive Situation: Does Starbucks face significant competition in this market or can they leverage on their industry leadership position?
  • Objectives Fit: Will serving this segment help Starbucks achieve their long term objectives such as brand building or increased revenue?

By taking each of these factors into consideration, marketers can evaluate how attractive a given target market is for purposes of marketing planning.


Targeting is an essential part of the STP (Segmentation, Targeting, and Positioning) analysis process. A marketer must be able to identify and segment potential customers, and then decide which target market to focus on. This process also includes analyzing the positioning strategy that will best appeal to the selected target market.

Let’s explore how to conduct an STP Analysis for Starbucks:

Selecting the Target Market

Once the situation analysis is complete for a company such as Starbucks, it is important to identify the target market that will be most receptive to their products and services. This process is often referred to as Segmentation, Targeting and Positioning (STP) and involves a careful review of the four variables: geography, demographics, psychographics (lifestyle), and behavior.

  • Geography: Starbucks considers factors like existing store locations, proximity to its customers’ homes or worksites and whether certain regions have demonstrated higher growth rates than others when determining the optimum geographic area for their target market.
  • Demographics: Starbucks looks at key demographic categories like age, gender, ethnicity, income level and occupation when deciding on their target market group.
  • Psychographics (Lifestyle): This can include looking at lifestyle indicators such as values, attitudes, interests/hobbies as well as personality traits when defining the company’s STP strategy.
  • Behavior: Analyzing brand loyalty metrics such as purchasing habits or buying cycles can help Starbucks determine which customers fall into specific behavior categories that can be harnessed for effective targeting.

Once all of this data has been collected and analyzed then Starbucks should be able to develop an effective competition segmentation strategy by analyzing their competitors’ strengths and weaknesses in relation to these variables along with any other relevant information.

Developing Positioning Strategies

Creating an effective positioning strategy is important for ensuring that your business goals are met. Through the process of STP (segmentation, targeting, positioning) a company can identify their ideal customer and craft marketing strategies that convert. Here’s a step-by-step guide on doing an STP analysis for Starbucks.

  1. Step 1: Segmentation
    The first step in creating your positioning strategy is to segment the different customer types in order to identify which target market you’ll want to focus on. Starbucks segments its customers into different groups based off of lifestyle, socioeconomics, geography and other factors.
  2. Step 2: Targeting
    Once you’ve segmented the customer base into different groups, it’s time to decide which specific segment you’re going to target with your messaging. Start by compiling data around both current and potential customers to find out who is most likely to purchase from you. At Starbucks, they do this through surveys and questionnaires that help them understand the profile of their customers better.
  3. Step 3: Positioning
    The next step is positioning or placing your product or service in the minds of customers so they can easily recognize it amongst competitors. To achieve this effectively with Starbucks’ targeted segments, brainstorm ways that could differentiate your product or services and develop creative ideas for how to communicate those differentiators across various channels such as advertising and social media campaigns. Focus on conveying a narrative around why and how your company stands out from competitors — this will be essential for developing strong brand loyalty over time with customers in each target market segment.


Positioning is an integral part of any STP (Segmentation, Targeting and Positioning) analysis for Starbucks. It is important to first identify the target market, then define the positioning strategy to maximize the appeal to that particular target market. By understanding what motivates people and what strategies Starbucks should use to communicate their message, a successful positioning strategy can be developed.

Let’s take a closer look at what positioning entails:

Developing Positioning Strategies

The purpose of a positioning strategy is to differentiate a brand from its competitors. Achieving distinctiveness requires an understanding of the competition and the target audience’s needs and preferences. STP stands for segmentation, targeting, and positioning.

Here are some key questions to consider when developing positioning strategies for Starbucks:

  • Who is the target market? What do they need or what gap do they have that Starbucks can fill?
  • Who are Starbucks’ main competitors and how are they positioned in comparison?
  • Which services or products should be emphasized by Starbucks to meet their customers’ needs?
  • What unique benefits does Starbucks offer in comparison to competing products/services?
  • How will these unique benefits be portrayed in product design, branding, advertising, etc.?
  • What other factors should be taken into account when developing the primary positioning statement for Starbucks?

These questions need to be answered in order to develop an effective positioning statement that meets the needs of both the business and its customers. Positioning strategies should reflect a thorough analysis of data gathered from market research and customer feedback as well as competitor observations. Many creative tactics can then be used to shape customer perceptions around marketplace products, services, brands, or ideas. It is important that companies stay ahead of their competition by creating clear distinctions around their offering that contribute not only to its success but also leverage potential growth opportunities.

Implementing Positioning Strategies

In pursuing effective positioning strategies, organizations need to closely analyze their target markets and design marketing efforts that meet their needs. A STP analysissegmenting, targeting, and positioning—is the ideal approach to accomplish this.

Segmentation is the process of dividing an audience into distinct subsets of customers with similar characteristics. These groups may be identified according to location, age group, product interests, and other criteria. Targeting is the process of selecting an appropriate market segment or segments that have the highest potential for a given product or service. Positioning is defining how you would like your product or service to be perceived by your target market in comparison with your competition.

A positioning strategy helps a company differentiate its products from those of its competitors; it must showcase its unique value proposition to potential customers so that those customers can determine why those particular offerings are better than others in the marketplace. Once the company has identified its desired market position, it can develop tactics and messages that will achieve it through pricing strategies, distribution changes, promotions or using other methods. It’s important for companies conducting a positioning strategy analysis to identify any potential gaps between customer perceptions and desired goals before investing resources into any particular tool or tactic.


In conclusion, when conducting an STP analysis for Starbucks coffee shop, it is important to identify the target market of the business and understand who the customers are. After this has been accomplished, it is crucial to develop a marketing mix strategy that considers how best to reach your target customers. Additionally, it is important to define the positioning of your brand so that potential customers will have a better understanding of what Starbucks stands for and why they should choose it over other coffee shops.

Finally, segmentation and targeting play a major part in STP analysis as they enable brands to design unique experiences and offerings tailored specifically to meet the needs of their target customer base. By following this process closely and making strategic decisions regarding STP analysis within a company like Starbucks can be very beneficial in terms of achieving overall success within the marketplace.