Increasing globalization, sterner emissions regulations, and the recent upsurge of big data are among the top challenges impacting the construction equipment industry in the next few years. Click To Tweet
The major challenges manufacturers and suppliers in the construction equipment industry face are as varied as the products they develop and sell. Nevertheless, designing products which meet customer needs, and doing so in an efficient and quick manner, is an area of continual improvement for manufacturers and suppliers in this industry. Additionally, increasing globalization is also a noted challenge, particularly in terms of manufacturing and developing products that meet the requirements of customers in various markets.Globalization has also brought about more consolidation of manufacturers and suppliers as companies in the construction equipment industry look to improve their product offerings, as well as better manage uncertain market conditions.
- The client: A leading construction equipment supplier
A leading South American conglomerate consisting of diversified businesses in the fields of construction and engineering, founded in 1944, approached Infiniti to conduct a robust market segmentation study. The construction equipment supplier was facing predicaments in identifying the potential customer segments and segment them based on their preferences. As a result, the client wanted to devise a robust market segmentation strategy to target specific and smaller groups. Additionally, with the help of a market segmentation engagement, the client wanted to identify the key segments and implement a segmentation strategy to deliver services for specific segments in South America.
How Can Market Segmentation Help Construction Equipment Suppliers?
Market segmentation solutions help construction equipment suppliers overcome the factors influencing the growth, yield advantage of new prospects, and reduce overall costs. These solutions also help companies in profiling the needs and desires of the customers and develop the product offerings accordingly. Moreover, Infiniti’s market segmentation solutions help construction equipment suppliers to categorize the market segments in terms of the distribution and geography.
Summary of our market segmentation solution?
The market segmentation experts at Infiniti followed a widespread research methodology comprising interviews and discussions with prominent stakeholders in the construction equipment industry space to help the client efficiently segment their products according to their end-user requirements. The experts also compiled information from a plethora of secondary sources including paid industry database, company presentations, and industry forums to help the client gain a better perspective of the market scenario in South America.
Solution Benefits and the Business Impact
With the help of Infiniti’s market segmentation engagement, the construction equipment supplier created multiple segmentation strategies to differentiate the market in South America based on distribution and pricing. This helped them to streamline their product positioning strategy based on the potential opportunities and accordingly align the product offerings with the target segments. Additionally, the client offered personalized marketing campaigns to target the best customers while being cost-effective.
The Future of the Global Construction Equipment Industry
The global construction equipment industry is witnessing significant changes. The demand has been highly unpredictable and is currently weak, the customer landscape and prospects of manufacturers and suppliers are changing, new revolutionary technologies are booming (big data and electrification), and competitors from emerging markets are becoming stronger. Also, change is not new in the construction equipment industry. But what is unique about this moment in the industry’s development is that many of these changes are congregating and hammering the industry all at once.
A must-read case study for strategy specialists and decision makers looking to develop an understanding of the global construction equipment industry
The recent increase in the number of construction activities around the globe leads to the path towards development. Development is a never-ending process, which is why there is always some form of construction going on somewhere. This, in turn, increases the demand for construction equipment, not only in terms of volume but also to innovate and evolve. Manufacturers are constantly innovating and bringing innovations to markets of all sizes and types. Additionally, mobility solutions have also been keeping pace as construction equipment continues to evolve.
The complexity of user demands
The construction industry is getting more and more efficient with new technologies. Today, it comes as no surprise that companies are able to build skyscrapers in a matter of few months. However, to build such marvels, complicated construction equipment are required. Users are demanding more efficiency, versatility, and durability from construction equipment. For instance, tires and tracks comprise the most expensive consumable items in a construction equipment. Contractors use such machines on a wider range of work and are under the pressure to deliver timely performance without compromising on durability. Additionally, they also want to get the highest amount of work done from machines with little capital and maintenance cost. Manufacturers are also leveraging the use of tire tracking software to help increase the awareness of the current situation and help predict future issues to minimize hourly costs.
Tracked construction equipment
To boost the performance of heavy machinery construction equipment, users are increasingly adopting tracks over tires. It is also evident in numerous industry reports which outline the growth of compact track loaders in comparison to traditional skid steers. The trend is evident in the rental, construction, and agricultural sectors. Tracks provide wider footprint better pulling power, more torque, and enhance the maneuverability and stability of the equipment. Such trends are even more prominent in places where seasons change drastically. Such tracked construction equipment usually costs less than tires and offers undeniable advantages. Additionally, manufacturers have come up with over-the-tire track (OTT) solution, which can convert a skid steer loader into a compact track loader within minutes.
Rising popularity of rentals
Let’s face it, all companies are on the lookout to cut their cost base. Sometimes it makes sense to rent the construction equipment than to make a purchase. For one, they avoid all the maintenance and depreciation costs. Also, they can make sure they make optimal use of the equipment. Buying and maintaining a large fleet of equipment carries a substantial financial burden and risk for the company. Renting out an equipment can provide companies with the flexibility to use it when needed without having to bear a huge capital expenditure.
Use of radial tires
Using construction equipment such as wheel loaders, backhoe, and motor graders to move between the local job sites is not uncommon in North America and Europe. It offers contractors productivity advantages as floating the equipment from site to site is often cumbersome. As a result, radial tires are gaining popularity as it offers better ride quality, decreased heat build-up, and reduced tread wear on hard surfaces.
To know more about the trends in the construction equipment market:
The construction market in the US is expected to witness significant growth over the next 15 years.
In today’s challenging supply market landscape, companies in the manufacturing sector are developing frameworks and tools to improve transparency and mitigate potential risks across the supply chain. The industry is also focusing on realigning their business models to go on par with the rising competitive cost structures and adequately meet the changing market dynamics. In the construction industry, the increasing appetite for infrastructure investment in the developed economies is driving the growth of the industry. Furthermore, the growth of the construction equipment sector can also be attributed to factors such as increasing urbanization and growing population.
However, on the other hand, here are some factors that may hinder the growth of the manufacturing industry.
- The rise of green construction: Today, the construction equipment sector is witnessing sustainability concerns with the sector accounting for more than 40% of the world’s carbon emission. Therefore, governments from across the globe are compelling prominent manufacturers to adopt smart planning and sustainable design techniques that could help in reducing the pollution levels.
- Poor productivity and reliability: Amid the shrinking profit margins, the barriers to the entry in the construction industry are low with the productivity remaining stagnant over the last couple of years. Moreover, the significant rise in the raw material prices has had a substantial impact on the productivity and the overall bottom line performance. Therefore, construction equipment manufacturers are facing the need to invest in advanced technologies to generate adequate profit margins.
- Skilled labor shortages: Recently, construction companies are witnessing a dramatic reduction in their workforce. It is estimated that 54% of the companies are unable to hire employees with the right skill trades. Moreover, the recent recession has also affected the current market with major skilled workers leaving the industry in search of better opportunities.
Amid the growing regulatory challenges and shrinking profit margins, companies in the manufacturing sector have started shifting towards the use of digital technologies to tap potential opportunities and address challenges related to poor profitability. Moreover, prominent construction equipment manufacturers should take adequate initiatives to be more productive and stay ahead of the competition. To tap into the potential market segments and identify the most profitable customers, construction equipment manufacturers are facing the dire need to adopt a robust market segmentation solution.
The Business Challenge
- The client: A leading construction equipment manufacturer
A renowned construction equipment manufacturer with manufacturing facilities spread globally, wanted to identify the latest trends in the construction industry and target specific products and services. With the help of a market segmentation study, the client wanted to tailor their offerings to meet the needs of the customers and improve their profit margins. The primary concern of the construction equipment manufacturer was to explore and analyze the characteristics of the potential customers and sell products and services in an agile and efficient manner.
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To profile the most profitable competitors, the market segmentation experts at Infiniti carried extensive research comprising interviews and discussions with key stakeholders in the construction equipment manufacturing sector. The experts also compiled information from a wide array of sources such as paid industry databases, company presentations, and industry forums.
The Solution Benefits and the Business Impact
The market segmentation solution offered by Infiniti helped the construction equipment manufacturer identify the latest industry trends and develop a more targeted approach to engage the customers. The client was able to segment the market based on purchase behaviors and divide markets according to the lifestyle, personality traits, values, and interests of the customers. Moreover, the market segmentation solution also assisted the construction equipment manufacturer in creating different target customer groups based on geographical boundaries.
In the future, the manufacturing industry is likely to promote innovation and productivity with prominent construction companies heavily investing in new technologies to gain a better market share.
A must-read case study for strategy specialists and decision makers looking to develop a better understanding of the construction equipment manufacturing space in terms of customer segmentation.
Lately, players in the construction equipment industry have started leveraging effective market analysis solutions to enhance their profitability and competitiveness across the industry space. Market analysis engagement includes the study of the market in terms of its strength, weaknesses, opportunities, and threats. Such engagements also help players operating in the construction equipment industry to devise effective market expansion strategies by taking drawbacks into account. Moreover, market analysis solutions have become an essential force for companies in the construction equipment landscape to gain comprehensive information about niche segments in the market.
The market analysis solutions offered by Infiniti help construction equipment industry clients in gaining insights into the dynamic market space. Additionally, clients operating in this industry space can determine the potential trends and opportunities in the construction equipment industry and improve their operations.
The Business Challenge
A global construction equipment industry client with offices spread across various geographies was facing predicaments in understanding the existing landscape of the industry. As a result, they wanted to gain a comprehensive picture of key components affecting the growth of the market. Furthermore, the client wanted to gain insights into the strengths and weaknesses of competitors to build a better market expansion plan and offer superior products to their customers.
Our Approach and Solutions Offered
To deliver valuable insights to the client, Infiniti’s market analysis specialists followed a comprehensive in-depth research methodology that included discussions and interviews with leading stakeholders in the construction equipment market space. Moreover, the market analysis specialists devised a dashboard comprising relevant pieces of information. This helped the client design effective marketing strategies across all verticals.
Additionally, the client was provided with a comprehensive representation of the key components of growth factors and insights about the market’s growth potential.
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Benefits of Market Analysis Study:
- Assessed potential opportunities and performances across geographies
- Gathered information to identify and mitigate risks across new segments
- Developed a robust business plan and analyzed the target market
- Devised an efficient product marketing strategy
Benefits of Our Integrated Approach:
In a brief period of eight weeks, the construction equipment industry client was able to add values to the information provided, find new niche market segments, and operate more efficiently with the help of an efficient product marketing strategy. Additionally, the client gained insights into the vital components to target in the market space to achieve a superior competitive advantage over their peers in the industry.
A must-read case study for strategy experts and decision makers looking to develop an understanding of the construction equipment industry.
For most businesses, market assessment plays a pivotal role in understanding the end-user, their attitudes, habits, and practices to effectively position their products in the market. Moreover, market assessment helps organizations answer strategic questions about the levels of investment in the business and the profitable growth areas. In the construction equipment space, a detailed market assessment helps businesses identify the target market and determine unique sales proposition. Furthermore, through a robust market assessment study, leading businesses can make informed data-driven product development decisions.
To determine the market attractiveness and enhance their product offerings, leading manufacturers in the construction are approaching organizations like Infiniti research. Infiniti’s market assessment solution helps the client effectively determine the market’s competitiveness and target the niche segment to identify the potential market gap. Organizations can further size up the challenges and opportunities and reform their existing sales architecture to go on par with the future buying patterns in the heavy excavator space.
The Business Challenge
The construction equipment sector is witnessing steady growth with a considerable number of equipment providers offering a wide array of products. However, a renowned heavy excavator manufacturer was facing a predicament understanding their market effectiveness in terms of the potential competitors, their offerings, and product positioning. The client further wanted to expand into a new market segment and refine the relationship with their existing customer base. Furthermore, the client wanted to understand the market dynamics and effectively allocate resources to retain their foothold in the market.
To identify the relevant customer segment and devise new marketing strategies, the client approached Infiniti’s market assessment experts. Infiniti’s market assessment experts carried out a blended approach comprising interviews and discussions with leading stakeholders such as KOLs, industry experts, product users, and procurement experts in the construction sector. Similarly, the market assessment experts at Infiniti created a dashboard to compile information from different proprietary sources such as paid industry databases, industry forums, company presentations, and newsletters.
Market Assessment Solution Benefits:
- Gained a detailed characterization of the market in terms of the product lines
- Gained a comprehensive analysis of the consumer’s purchasing habits, usage, and overall awareness of the product
- Identified the key competitors and their performance in the market
- Analyzed the market landscape in terms of SWOT analysis and identified the barriers to entry
- Assessed the needs, expectations, and standards of the customers and devised an effective go-to-market strategy
Benefits of Our Integrated Approach
With the help of this market assessment study, the client was able to identify the overall market potential, the extent of competition, and assess unmet customer needs. Furthermore, the client was able to gain accurate and actionable data and improve the products and services. Also, the client was able to take necessary adjustments in their marketing and product development approach.
A must-read case study for strategy experts and decision makers looking to develop an understanding of the construction equipment space.
In today’s dynamic and competitive business environment, construction equipment rental companies across the globe are leveraging new market segmentation strategies to enhance their competitiveness and profitability. Moreover, construction equipment rental companies have also started targeting new customer segments by offering attractive and innovative products and services to deal with the high level of market competition. As a result, market segmentation studies have become an essential force for companies in this landscape to gain an in-depth information about niche segments in the market. Moreover, an effective market segmentation helps construction equipment rental companies gain a better outlook of the market and customer preferences.
Infiniti’s market segmentation solutions assist equipment rental companies in identifying the potential parameters for positioning their portfolios in the market in terms of demographics and psychographics. With our help, clients can determine the potential opportunities and the eminent trends in the construction equipment rental industry to optimize their current offerings and improve their operations.
The Business Challenge
The primary aim of the client was to identify customer preferences, target the right customers, and allocate resources to meet the customer requirements.
Moreover, the leading construction equipment rental company wanted to leverage superior market segmentation strategies to develop new and unique products to different target audiences in the market space. Additionally, the client wanted to understand the factors hampering the growth of the market and develop effective strategies to introduce their offerings in this market space.
To overcome the potential challenges, target the right customers, and develop a new product strategy, the construction equipment rental client approached Infiniti Research’s team of market segmentation experts. Infiniti’s team of experts conducted a comprehensive research including discussions and interviews with leading stakeholders in the construction equipment rental space. Additionally, they compiled information across numerous exclusive sources such as company presentations, paid industry databases, newsletters, and media platforms to cater to the challenges faced by the client.
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Benefits of the Market Segmentation Study:
- Identified the segments that are easier to target and allocated resources
- Segmented the potential customers into sub-segments based on their preferences
- Helped client tap potential niche market segments
- Improved competitiveness and profitability and enhanced marketing and service efficiency
- Tailored products and services to address the unique needs of the target audience
Benefits of Our Integrated Approach
In a mere span of ten weeks, the construction equipment rental client was able to identify potential target groups and benchmark their product offerings against those of their competitors. The client was also able to enter potential markets and venture into new segments within the construction equipment industry. The engagement also helped the client devise an effective marketing plan to overcome potential challenges.
A must-read case study for strategy experts and decision makers looking to develop an understanding of the construction equipment rental industry.
In recent years, the adoption of excavators and wheel loaders has been increasing with the parallel increase in construction activities. These machines account for a significant percentage of the construction equipment market globally. Excavators find their application in below ground and surface level operations; whereas, wheel loaders find extensive use in construction projects, owing to their small size and versatility. The rising adoption of earth moving equipment can be attributed to the advances in technology, increasing demand for better infrastructure facilities, and expanding urban population.
Although earthmoving machines are witnessing an augmented adoption among various end users, the market is subjected to several challenges. High initial investment costs, the high cost of research and development, and stringent emission norms are some of the factors, which may hamper the market’s growth. With years of expertise in carrying out extensive research, Infiniti’s market analysis team offers strategic insights into the market landscape in terms of the pricing trends, competitors, and product portfolio.
The Business Challenge
A prominent South Asian conglomerate was facing challenges understanding the accurate pricing information of the select set of models across the US and Europe. The client wanted Infiniti to carry out a comprehensive market analysis on pricing and customer intelligence for specific competitors operating in the excavator and wheel loader segment in Europe so that they could identify potential investment opportunities.
Want to learn more about Infiniti’s research methodology?
Our Research Methodology
To gain an in-depth understanding of the market’s landscape, Infiniti’s market analysis experts carried out a blended research approach comprising of email or phone based invites, reminders and conducting telephone, followed by data analysis and insight development. Moreover, the market analysis experts also conducted a combination of dealer interviews and customer surveys to offer a holistic overview of the market space across the target region.
Our Solution Helped the Client
- Identify the purchase considerations of different brands
- Obtain pricing and customer intelligence insights for specific competitors
- Analyze the retail price trends and customer preference for the segment under focus
- Understand the current price, terms and conditions, discount schemes, and financing options for excavators and wheel loaders
Benefits of Our Integrated Approach
In a span of four weeks, the client was able to assess the excavators and wheel loaders market in terms of key buying factors and ranking of attributes. The market analysis engagement also brought into limelight the key influencers and purchase decision makers in the market and also analyzed the influence of advertisements and promotions on the potential growth prospects of the market.
A must-read market analysis case study for strategy experts and decision makers looking to assess the market landscape for excavators and wheel loaders.
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