The Value of Segmentation, Targeting, and Positioning in Dispensary Advertising

Chances are that your customer base is made up of individuals who share certain characteristics, interests, or traits. After all, they all shop with you and love cannabis.

At the same time, some may prefer vapes, while others stick with flower or concentrates. Grouping these individuals up into segments that can be targeted with marketing messages is much more time and cost-effective than trying to market your dispensary to all of them at once.

By making the most of segmentation, targeting, and positioning, you can market your dispensary to each of these groups in ways that are more likely to appeal to them, and less likely to waste precious advertising dollars.

How can you put segmentation, targeting, and positioning to work for your dispensary? Keep reading to find out!

What Is the Segmentation, Targeting & Positioning Model?

Businesses love to think that their products or services can appeal to just about anyone. But in reality, certain kinds of people are more likely to respond to their marketing message than others.

Casting a wide net and hoping for the best can quickly drain your marketing budget. The segmentation, targeting, and positioning model (STP) is an audience-focused approach for communicating with potential and established customers. This customer-centric approach to advertising can work to help you discover and target niche markets, new customers, and new market opportunities.

The segmentation, targeting, and positioning model is a 3 step process that divides your audience into groups and targets them with specific marketing messages that are likely to appeal to them. Ultimately, the STP model will help you better target your advertising messages for the benefit of both your customers and your dispensary.

So what does the STP model actually look like?


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The process all begins with segmentation.

Before you can target your audience with personalized messages, you first need to know just who they are.

Segmentation is the process of dividing your audience into groups or ‘segments’ based on shared characteristics. Splitting your customer base up into smaller groups will make it easier to promote the products, features, services, and benefits that will appeal to them the most.
In order to effectively segment your audience, you must first use data to create accurate customer personas. There are several ways for you to obtain this data such as by directly asking your customers questions (surveys, emails, etc.), by using software to indirectly track customers, or by seeking out third-party data sources and combining them with your own data.

When it comes to directly tracking your customers, you should consider the following data sources:

  • The dispensary locations that a customer frequents
  • The products that a customer purchases most often
  • The brands that a customer purchases most often
  • The amount of money that a customer spends: in total, on certain brands, on certain products
  • Special dates such as a customer’s birthday, date of first purchase, etc.

However you choose to collect it, data will help you to better understand your customers in order to group them up more accurately and effectively. Once you have obtained the data you need, you can begin using it to create customer personas and target segments.

There are many criteria that you can use in order to segment your audience. You can effectively segment your dispensary’s customers based on criteria such as:

  • Demographics: age, gender, ethnicity, marital status, income level, etc.
  • Lifestyle: interests, activities, preferences, hobbies, etc.
  • Behavior: frequent purchases, brand loyalty, money spent, shopping habits and trends, etc.
  • Psychographics: personality, attitudes, beliefs and values, risk aversion, etc.
  • Geographic Location


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Once you have established customer segments, you can begin to think about how to target them. Targeting is the part of the process where you select which of your customer segments you want to focus on.

Deciding which segment to target isn’t always an easy task. There are certain criteria that you should consider when deciding which segments to prioritize:

  • How big is the segment? Is it large enough that it deserves to be prioritized?
  • Are there significant measurable differences between this segment and other segments?
  • What kind of revenue can you anticipate from marketing to this segment? (this can depend on factors such as age, income level, spending trends, etc.)
  • Is the segment accessible? How effectively can your marketing team reach it?
  • Are there any potential barriers to marketing to this segment? (legal, social, cultural, religious, etc.)

Targeting multiple segments from the very start can quickly become overwhelming. It’s a good idea to move forward one segment at a time, even if you are targeting multiple segments at once. Focusing on just one segment at a time will help you to develop straightforward and successful positioning strategies for each segment.


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After identifying which segments you wish to target, you can begin to develop a positioning strategy for each one.
Market positioning is the process of framing a brand in a certain way that appeals to customers. A brand’s position is where it exists in the customer’s mind in relation to other companies on the market, and especially in relation to its close competitors.

Rather than just floating your brand out there and hoping for the best, positioning gives you a certain level of influence over how people relate to your brand. Positioning can help to provide clarity on the value of your brand, to differentiate you from your close competitors, to incorporate memorable messages into your branding, to justify your pricing strategies, and much more!
The first step is to take a moment to examine your brand from the perspective of a potential customer.

  • If you were them, would you choose your brand over a competitor, and why?
  • What is it about your brand that would appeal to you if you were a customer in this segment?
  • What features are particularly appealing to you as a member of this audience segment? Conversely, what would your pain points be?

This exercise can help you to identify customer pain points and potential weaknesses in your brand strategy, while also giving you a better understanding of where your brand currently stands in relation to competitors.

By gaining a solid understanding of what each segment thinks is most important for brand selection, and by identifying the areas where your competitors are excelling or falling short, you can develop a successful positioning strategy for each segment.

Positioning maps are an excellent tool for identifying where your brand stands in relation to competitors when it comes to important brand attributes.

Bringing It All Together

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By making the most of segmentation, targeting, and positioning, dispensaries can target their marketing messages to improve their effectiveness.

The STP model can be applied throughout various marketing platforms, campaigns, and initiatives. For instance, segmenting your mobile ads geographically can help you to optimize your PPC spend, and segmenting your loyalty program members can help you to offer more appealing offers and promotions to each segment.

To find out more about segmentation and how you can apply it to your dispensary’s customer base, check out our article on making the most out of segmentation! This is a great tool to implement with display ads to get the most from your budget.