Here's a truth that sounds obvious but that most marketing teams still get wrong: you can't market to everyone. I know, I know. You've heard that a thousand times. But watch what happens in practice. A brand says "our target audience is women aged 18-54 who care about wellness." That's not targeting. That's a description of half the population.
Targeting is the disciplined act of choosing which specific customer segments you will pursue and which you will deliberately ignore. It sits at the center of the STP model (Segmentation, Targeting, Positioning) and it's the decision that determines whether your marketing dollars work hard or just evaporate.
Targeting is the second step in Philip Kotler's STP framework. After you've divided the market into distinct segments through segmentation, targeting is the process of evaluating each segment's attractiveness and selecting one or more segments to serve.
The American Marketing Association defines targeting as "the process of evaluating each market segment's attractiveness and selecting one or more segments to enter." That's a clinical definition. What it really means is this: targeting forces you to say no. It forces you to decide that some customers matter more than others for your business, your product, and your moment in time.
This sounds harsh, but it's the foundation of every effective marketing strategy. Without targeting, you spread your budget thin, your message generic, and your positioning unclear.
Kotler and other marketing scholars have identified four fundamental approaches to targeting. Each one reflects a different philosophy about how broad or narrow your focus should be:
You treat the entire market as one segment and deploy a single marketing mix to reach everyone. Coca-Cola did this for decades with a universal "refreshment" message. The advantage is economies of scale in production and advertising. The disadvantage is that you're vulnerable to competitors who serve specific needs better than your one-size-fits-all approach.
You target multiple segments, each with a tailored product, price, or message. Procter & Gamble is the textbook example. They sell Tide, Gain, Cheer, and Era in the same laundry detergent category, each aimed at a different segment. It's more expensive to operate, but it captures more total market share.
You pick one segment and go deep. Whole Foods before the Amazon acquisition was a classic concentrated targeting play: premium organic groceries for affluent, health-conscious urban consumers. The risk is obvious (if that segment shrinks, you're in trouble), but the upside is that you can own your niche completely and build extraordinary brand equity.
You tailor your offering to individuals or very small groups. Netflix recommending shows based on your viewing history. Amazon suggesting products based on your browse patterns. Spotify's Discover Weekly playlist. Micromarketing was once a fantasy; now, thanks to AI and data infrastructure, it's the default for digital-native brands.
| Strategy | Segments Served | Message | Cost | Risk | Best For |
|---|---|---|---|---|---|
| Undifferentiated | All | One universal message | Low | Competitor vulnerability | Category leaders, commodities |
| Differentiated | Multiple | Tailored per segment | High | Complexity, cannibalization | Large portfolios, CPG |
| Concentrated | One | Deep and specialized | Medium | Segment dependency | Startups, luxury, niche brands |
| Micromarketing | Individuals | Personalized | Very high | Data infrastructure, privacy | Digital-native, subscription |
Not all segments are worth pursuing. The classic criteria for evaluating a segment's attractiveness include:
Size and growth potential. Is the segment large enough to be profitable? Is it growing? A segment that's shrinking may not justify investment even if it's currently large. Gartner's marketing research regularly highlights that high-growth segments often deliver 3-5x better ROAS than mature ones.