Blog · Territory, capacity and quota planning
The STP marketing model connects market groups, target choices and positioning. Follow a worked business example that tests the sales and contribution evidence behind each decision and separates recorded results from buyer research.
The STP marketing model means segmentation, targeting and positioning: define useful buyer groups, choose which to prioritize and establish the benefit the offer should stand for. Its value is the connection between those decisions. A target choice needs economic evidence, while a positioning claim also needs buyer and delivery evidence.
| Stage | Decision | Evidence to bring | Business owner |
|---|---|---|---|
| Segmentation | Which buyer groups differ meaningfully? | Account fields, purchasing conditions, buyer research | Marketing with sales |
| Targeting | Which groups should receive resources? | Contribution, demand evidence, reachability, delivery requirements | Commercial leader with finance |
| Positioning | What relevant benefit can the offer credibly promise? | Buyer language, verified capabilities, competing alternatives | Marketing with operations |
Start with market segments in marketing for the opportunity-group boundary. Keep the group definition stable while comparing results. Otherwise a disappointing group can appear better simply because its weaker customers were reassigned.
Industry, size and purchasing structure may help identify businesses consistently. Census guidance on NAICS explains its classification of establishments by production activity. Such a code describes an industry; it does not establish buyer needs. The existing B2B customer segmentation method covers the detailed account assignment work.
Use account IDs, approved segment labels, proposal IDs, qualification dates, final outcomes, net revenue, variable delivery costs, attributable acquisition spending and delivery hours. State the observation window and the cost policy before calculating anything.
This fictional US training company reviews an annual proposal cohort. Every proposal belongs to a distinct account and has reached a final decision. Every winning account has completed its first engagement. Revenue and delivery costs below cover those first engagements; acquisition spending includes the effort spent pursuing both wins and losses in each group.
| Candidate group | Proposals | Buying accounts | Net revenue (USD) | Variable delivery cost (USD) | Acquisition spending (USD) | Delivery hours |
|---|---|---|---|---|---|---|
| Manufacturers | 12 | 6 | 180,000 | 90,000 | 30,000 | 90 |
| Distributors | 20 | 8 | 240,000 | 156,000 | 36,000 | 160 |
| Contractors | 10 | 5 | 150,000 | 75,000 | 30,000 | 75 |
| Total | 42 | 19 | 570,000 | 321,000 | 96,000 | 325 |
These are deliberately small illustrative groups. They demonstrate the calculation, not a market benchmark or a reliable estimate for every prospective buyer.
Cohort contribution after acquisition spending = Net revenue − Variable delivery cost − Acquisition spending
Contribution per delivery hour = Cohort contribution after acquisition spending / Delivery hours
This contribution excludes fixed overhead, taxes and financing. It is a management comparison with an explicit cost boundary. It is not net income, and it does not predict the incremental return from the next campaign.
| Group | Contribution calculation (USD) | Contribution (USD) | Contribution margin | Contribution per delivery hour (USD) |
|---|---|---|---|---|
| Manufacturers | 180,000 − 90,000 − 30,000 | 60,000 | 33.3% | 666.67 |
| Distributors | 240,000 − 156,000 − 36,000 | 48,000 | 20.0% | 300.00 |
| Contractors | 150,000 − 75,000 − 30,000 | 45,000 | 30.0% | 600.00 |
| Total | 570,000 − 321,000 − 96,000 | 153,000 | 26.8% | 470.77 |
For manufacturers, 60,000 / 180,000 = 33.3%, and 60,000 / 90 = $666.67 per delivery hour. Percentages are rounded to one decimal place and hourly figures to cents, using unrounded calculations.
The checks are direct. Group contributions sum to $153,000, equal to total revenue less both cost columns. Hours sum to 325. Overall contribution per hour is 153,000 / 325 = $470.77; averaging group rates would give the wrong total.
Manufacturers contribute more despite distributor revenue being higher. That supports investigating manufacturers as a priority, subject to reachable demand and available delivery skills. Use the separate target-market selection guide for that allocation decision.
A revenue table cannot tell you which benefit buyers value. The SBA's market research guidance recommends investigating demand, pricing, saturation and competitors, using existing sources or direct research. Ask buyers which problem triggered the purchase and which alternatives they considered.
Suppose manufacturer interviews identify scheduling training around production shifts as an unmet need. A proposed position could be: “For plant managers scheduling safety training across shifts, our company provides practical sessions planned around production calendars.” That is a hypothesis for testing, not a conclusion from the contribution table.
Operations must verify that the timetable and staffing can support the promise. Sales should test whether buyers understand and value it. Record objections alongside outcomes so that a later review can distinguish an appealing message from an offer the business can deliver profitably.
Suppose manufacturer variable delivery costs rise to $108,000 while revenue, acquisition spending and hours stay unchanged. Its contribution becomes 180,000 − 108,000 − 30,000 = $42,000, and contribution per hour becomes 42,000 / 90 = $466.67.
Contractors still contribute $45,000 and $600.00 per hour. The original manufacturer advantage has disappeared. This sensitivity check identifies a delivery-cost assumption worth validating before expansion. Keep acquisition spending definitions aligned with your separate customer acquisition cost calculation.
Upload your account, sales and cost workbook with approved group labels; Covirage maps the columns, and its tools compute and check the supplied revenue and contribution figures. The external AI model explains the results with every figure traced to its rows, supporting the evidence behind your commercial decisions. Create a free Covirage account and bring a sample of your own data.
See sales insights for the business questions these comparisons support.
Segmentation defines groups with shared needs or buying conditions. Targeting chooses which groups deserve commercial resources. Positioning states the relevant benefit and reason to choose the offer. Each stage needs evidence, and later findings can change earlier choices.
Segmentation describes candidate groups without committing resources. Targeting makes a choice among those groups using demand, economics, reachability and delivery requirements. A business can recognize a segment clearly and still decide that it should not pursue it.
Revenue data can show which groups buy and what they contribute. It cannot establish why buyers prefer an offer or which benefits they believe. Combine the figures with buyer interviews, sales notes and verified delivery evidence.
Marketing normally coordinates the review and buyer research. Sales validates account groups and purchasing conditions, finance checks contribution definitions, and operations confirms delivery capacity. The commercial leader approves the target choice and the promises the business will make.