A New Spatial Classification Methodology for Simultaneous Segmentation, Targeting, and Positioning (STP Analysis) for Marketing Research

Abstract : The Segmentation-Targeting-Positioning (STP) process is the foundation of all marketing strategy. This chapter presents a new constrained clusterwise multidimensional unfolding procedure for performing STP that simultaneously identifies consumer segments, derives a joint space of brand coordinates and segment-level ideal points, and creates a link between specified product attributes and brand locations in the derived joint space. This latter feature permits a variety of policy simulations by brand(s), as well as subsequent positioning optimization and targeting. We first begin with a brief review of the STP framework and optimal product positioning literature. The technical details of the proposed procedure are then presented, as well as a description of the various types of simulations and subsequent optimization that can be performed. An application is provided concerning consumers' intentions to buy various competitive brands of portable telephones. The results of the proposed methodology are then compared to a naïve sequential application of multidimensional unfolding, clustering, and correlation/regression analyses with this same communication devices data. Finally, directions for future research are given.