Market Segmentation: Defining a New Strategy for a Leading Player in the Power Market
Despite the encouraging growth trajectory in the global power market, several power companies have not been able to induce and sustain the required capacity addition to match the ever-growing demand.
The global power market is undergoing a massive transformation, which arguably, together with the emergence of technologies such as AI and IoT will redefine the way businesses function in the coming decades. In the power market, this drastic transformation is being driven at one end by the increasing need to power a growing society in a way that it makes sense for the environment. However, at the other end, this transformation is fueled by the rapid technological innovations and developments that help in sourcing and storing energy from several sources.
Challenges in the global power market vary by region and the adopted utility model, but a few major pain points that are expected to wreak havoc in this segment include – the rise in distributed power generation, the global shift towards energy efficiency, a change in resource mix, and negative demand growth in specific market segments. In the light of such realities, the global power market is expected to face a range of short-term challenges; thereby, driving the need to redefine business models.
The Business Challenge
- The client: A power company
- Revenue: ~$15.6 billion
- Area of Engagement: Market segmentation
To improve their profitability and competitiveness, the client – a multinational power company – approached Infiniti to engage in a market segmentation study. The B2B power company wanted to identify and target the right market segment in order to maximize customer retention, brand recall, brand equity, communications, and competitiveness.
The client wanted to conduct a market segmentation study to gain strategic insights into the global power market. Their primary objective was to identify the appropriate segments and develop specific services, products, and marketing campaigns that address the needs of the particular segments. At the same time, by focusing on the needs of the most profitable market segment, the power company wanted to enhance customer retention.
How Our Market Segmentation Solutions Help Companies in the Power Market?
An effective market segmentation study requires a detailed understanding of the market landscape and the skilled art of finding and grouping the appropriate segments. With vast experience in power market segmentation, our experts help you to gain insights into the global power industry’s landscape.
Several power companies shape their market segmentation strategies using the outcome of market analysis and market research. However, market segmentation requires more ‘art’ and ‘skill’ rather than market research. With years of experience in market research, our experts help you uncover underlying market segments and their characteristics to drive business value.
Summary of our market segmentation engagement
Infiniti’s market segmentation engagement helped the power company to enhance profitability by effectively segmenting the market into sub-divisions. The market segmentation study also helped them accomplish three main goals – identify segments that had the highest potential to drive profitability, identify segments that were interested in procuring value-added services, and develop new strategies to enhance customer retention.
Furthermore, to help the client assess the market landscape and identify imminent market trends, the market research experts at Infiniti conducted a market segmentation study that offered valuable insights on decision-making procedures, market trends, and barriers. The approach included primary and secondary research methodologies coupled with qualitative and quantitative data collection procedures. The experts also reached out to various stakeholders in the power market.
Solution Benefits and the Business Impact
Infiniti’s market research experts offered end-to-end solutions that helped power company to better understand the market’s dynamics. In addition, the market segmentation study helped in the identification of new white spaces for products and service offerings. The client also gained detailed insights into the power market, which enabled them to optimize their customer acquisition and retention strategies.
In today’s competitive market landscape, businesses across sectors are expected to face unprecedented future challenges owing to the high capital costs and stringent regulations. Arguably, this pressure is more on the global power market, which is being influenced not only by the corporate mandates and imperatives for maintaining cost efficiency but also by several geopolitical and macroeconomic factors.
As the power market arrives at this crossroads, companies operating in this sector will have to make a series of difficult decisions. To do so, the power companies will have to focus more on sustainable development than in the past, by considering factors such as – economic, social, and technological advancements. To answer several such questions effectively companies will have to consider the most likely future scenario and consider the implications of each of the scenario on the overall business value.