Segmenting the energy market: Problems and successes

Research output: Contribution to journalArticle

5 Citations (Scopus)

Abstract

This paper aims to explore how segmentation is often undertaken in practice, highlighting problems commonly encountered. It is based on the deregulated and highly competitive UK market for energy, namely gas and electricity supply. The case is appropriate for modules in marketing strategy, target marketing and marketing management, at MBA, MSc or advanced UG levels. The case highlights why this organisation opted for segmentation, how it conducted this project, and the problems faced. These insights are referenced with the segmentation literature. With little product differentiation possible, gas and electricity tend to be price-driven purchases, which increases the importance of effective segmentation and shrewd target segment selection. Both consumer and business segments are cited, but the case focuses more on the business-to-business outcomes. The approach adopted for selecting which segments to target is also featured. This case explores the use of market segmentation and the practical difficulties encountered. The solutions to these difficulties are highlighted. The case could not disclose the company's identity, but provides an insightful explanation of how segmentation may be conducted and the problems encountered. There is bias towards business segments, rather than consumer ones. Readers will be made aware of the impediments facing effective execution of market segmentation and be well prepared to spot such difficulties in any such projects that they might undertake. Few cases explore the practical issues encountered during segmentation or the creation of a new target market strategy. These difficulties are addressable, but only if they are anticipated or identified expediently. This paper provides such warnings and guidance.

Original languageEnglish
Pages (from-to)580-592
Number of pages13
JournalMarketing Intelligence & Planning
Volume29
Issue number6
DOIs
Publication statusPublished - 20 Sep 2011
Externally publishedYes

Fingerprint

Energy market
Segmentation
Market segmentation
Marketing management
Purchase
Guidance
Electricity
Energy
Gas
Module
Electricity supply
Business outcomes
Impediments
Target marketing
Business to business
Product differentiation
Target markets
Marketing strategy
Warning
Gas supply

Keywords

  • Consumers
  • Energy
  • Energy industry
  • Marketing
  • Marketing strategy
  • Pricing

ASJC Scopus subject areas

  • Marketing

Cite this

Segmenting the energy market : Problems and successes. / Simkin, Lyndon; Dibb, Sally.

In: Marketing Intelligence & Planning, Vol. 29, No. 6, 20.09.2011, p. 580-592.

Research output: Contribution to journalArticle

@article{e4b2bdf6cd914e78ac2a44a166b952ae,
title = "Segmenting the energy market: Problems and successes",
abstract = "This paper aims to explore how segmentation is often undertaken in practice, highlighting problems commonly encountered. It is based on the deregulated and highly competitive UK market for energy, namely gas and electricity supply. The case is appropriate for modules in marketing strategy, target marketing and marketing management, at MBA, MSc or advanced UG levels. The case highlights why this organisation opted for segmentation, how it conducted this project, and the problems faced. These insights are referenced with the segmentation literature. With little product differentiation possible, gas and electricity tend to be price-driven purchases, which increases the importance of effective segmentation and shrewd target segment selection. Both consumer and business segments are cited, but the case focuses more on the business-to-business outcomes. The approach adopted for selecting which segments to target is also featured. This case explores the use of market segmentation and the practical difficulties encountered. The solutions to these difficulties are highlighted. The case could not disclose the company's identity, but provides an insightful explanation of how segmentation may be conducted and the problems encountered. There is bias towards business segments, rather than consumer ones. Readers will be made aware of the impediments facing effective execution of market segmentation and be well prepared to spot such difficulties in any such projects that they might undertake. Few cases explore the practical issues encountered during segmentation or the creation of a new target market strategy. These difficulties are addressable, but only if they are anticipated or identified expediently. This paper provides such warnings and guidance.",
keywords = "Consumers, Energy, Energy industry, Marketing, Marketing strategy, Pricing",
author = "Lyndon Simkin and Sally Dibb",
year = "2011",
month = "9",
day = "20",
doi = "10.1108/02634501111166094",
language = "English",
volume = "29",
pages = "580--592",
journal = "Marketing Intelligence and Planning",
issn = "0263-4503",
publisher = "Emerald",
number = "6",

}

TY - JOUR

T1 - Segmenting the energy market

T2 - Problems and successes

AU - Simkin, Lyndon

AU - Dibb, Sally

PY - 2011/9/20

Y1 - 2011/9/20

N2 - This paper aims to explore how segmentation is often undertaken in practice, highlighting problems commonly encountered. It is based on the deregulated and highly competitive UK market for energy, namely gas and electricity supply. The case is appropriate for modules in marketing strategy, target marketing and marketing management, at MBA, MSc or advanced UG levels. The case highlights why this organisation opted for segmentation, how it conducted this project, and the problems faced. These insights are referenced with the segmentation literature. With little product differentiation possible, gas and electricity tend to be price-driven purchases, which increases the importance of effective segmentation and shrewd target segment selection. Both consumer and business segments are cited, but the case focuses more on the business-to-business outcomes. The approach adopted for selecting which segments to target is also featured. This case explores the use of market segmentation and the practical difficulties encountered. The solutions to these difficulties are highlighted. The case could not disclose the company's identity, but provides an insightful explanation of how segmentation may be conducted and the problems encountered. There is bias towards business segments, rather than consumer ones. Readers will be made aware of the impediments facing effective execution of market segmentation and be well prepared to spot such difficulties in any such projects that they might undertake. Few cases explore the practical issues encountered during segmentation or the creation of a new target market strategy. These difficulties are addressable, but only if they are anticipated or identified expediently. This paper provides such warnings and guidance.

AB - This paper aims to explore how segmentation is often undertaken in practice, highlighting problems commonly encountered. It is based on the deregulated and highly competitive UK market for energy, namely gas and electricity supply. The case is appropriate for modules in marketing strategy, target marketing and marketing management, at MBA, MSc or advanced UG levels. The case highlights why this organisation opted for segmentation, how it conducted this project, and the problems faced. These insights are referenced with the segmentation literature. With little product differentiation possible, gas and electricity tend to be price-driven purchases, which increases the importance of effective segmentation and shrewd target segment selection. Both consumer and business segments are cited, but the case focuses more on the business-to-business outcomes. The approach adopted for selecting which segments to target is also featured. This case explores the use of market segmentation and the practical difficulties encountered. The solutions to these difficulties are highlighted. The case could not disclose the company's identity, but provides an insightful explanation of how segmentation may be conducted and the problems encountered. There is bias towards business segments, rather than consumer ones. Readers will be made aware of the impediments facing effective execution of market segmentation and be well prepared to spot such difficulties in any such projects that they might undertake. Few cases explore the practical issues encountered during segmentation or the creation of a new target market strategy. These difficulties are addressable, but only if they are anticipated or identified expediently. This paper provides such warnings and guidance.

KW - Consumers

KW - Energy

KW - Energy industry

KW - Marketing

KW - Marketing strategy

KW - Pricing

U2 - 10.1108/02634501111166094

DO - 10.1108/02634501111166094

M3 - Article

VL - 29

SP - 580

EP - 592

JO - Marketing Intelligence and Planning

JF - Marketing Intelligence and Planning

SN - 0263-4503

IS - 6

ER -