The process consists of three parts. The first phase, choosing the value, represents the “homework” marketing must do before any product exists. The marketing staff must segment the market, select the appropriate market target, and develop the offering’s value positioning.
The formula “Segmentation, Targeting, Positioning (STP)” is the essence of strategic marketing. Once the business unit has chosen the value, the second phase is providing the value. Marketing must determine specific product features, prices, and distribution.
The task in the third phase is communicating the value by utilizing the sales force, sales promotion, advertising, and other communication tools to announce and promote the product. Each of these value phases has cost implications.
