An Analysis of the Potential Target Market through the Application of the STP Principle/Model

Abstract

Purpose – The purpose of this paper was to establish and identify the target market of a proposed residential development in Gaborone using the STP strategy. Research design/methodology/approach – Both non-probability and probability sampling techniques were used by applying qualitative and quantitative research methods (interviews and questionnaire) were used to get research data in order to meet the objective of the study. A survey instrument using a self-administered questionnaire was developed and administered to the respondents who were working earning a monthly salary was used in order to meet the minimum qualifying criteria for a home loan being 30% of one’s income to service mortgage payments. Significance - The study is relevant to developers who just develop/invest scarce resources without establishing the need/demand for the product. It will be a lesson learnt for those developers who shun/disregard the input of market research in the process of decision making for housing property development. Findings – The study established that this was the first research of its kind within the housing market. It also revealed that target market identification is critical in market research because it help the developer to minimise the unsystematic and systematic risks which might affect the success of the development project thereby impacting on the profitability of the business. It will also help them appreciate by positioning the product in the minds of the target market through offering the product with features that the customers are looking for. From the developer’s point of view, they will be fulfilling the customer’s needs by implementing the recommendations and results of the market research report. Once these needs are met and fulfilled, the property listing period is also reduced at the time of marketing the property and customers are identified even before the propduct is developed thus adding value to the business. Originality/value – Based on the key findings, recommendations are made in this paper to improve the market take-up rate through the application of STP analysis.

DOI: 10.5901/mjss.2015.v6n4s3p324