esigning Buildings Wiki Newsletter Reg

construction industry knowledge base

Search

Main author Categories

Philip Collard
Other Consultant
Last edited 03 Aug 2014
Website
See full history
Create an article

Market segmentation in the construction industry

Share Foll

It is very important for firms to split their clients (or customers) into different segments, grouping
Related articles
together those clients with similar characteristics which have similar needs. This is not simply
about size or sectors but more about what services are bought, by whom, and why. The aim is to Constructing a three ye
plan.
identify true clients’ needs, which can be combined together to identify the best segments on
which to focus marketing efforts. Embedding successful

Marketing audit.

This process is called ‘segmentation’ and will identify the most attractive and profitable segments Marketing planning.
and also those with the highest potential for growth. One-year tactical or op

Winning work.
Operating a market segmentation strategy can offer considerable competitive advantage.
Segmentation centres around identifying the best way to distinguish the main sectors an
organisation works in within the total construction market. The skill is in choosing appropriate
segmentation criteria given the wide range of possibilities.

The criteria must refer to difference in demand by each customer group. For example the needs
and requirements of development directors of retailers are different to development directors
specialising in commercial office buildings. The features of an organisations range of services
benefit different clients in different ways and so organisations must distil the benefits they
experience and promote tailored messages to each segment group.

Major segmentation criteria in the construction industry would be:

Industry segments Geographical

Commercial Wales
 Industrial North

Public non-housing Midlands

Infrastructure South

Private housing Scotland

Public housing etc

Each of the above industry classifications must also be segmented into further categories such
as; commercial retail, commercial office or public health, education and private health and private
Featured articles
education etc. The same applies for geographical segmentation such as Midlands into East and
West Midlands. Snowfall at the Berkele

Whilst organisations must clearly segment accordingly to their own customer grouping it is
advisable to organise them in such a way that it is possible to layer over data and research
findings from industry research bodies to ensure consistency and compatibility. If organisations
fail to ensure their segmentation forecasting is based on quantitative research, it will not usually
be easy to measure potential segment size, or more importantly, progress. It is therefore critical to
recognise that the full implementation of a segmented strategy demands an adequate flow of data
for both planning and control purposes.

Without the use of segmentation organisations pursue a homogenous strategy, which may lead to
a product or service trying to be all the things to all people. This may work reasonably well when
an organisation is dominant, or in a monopoly situation, but it leaves their product or service RSHP create a fairytale
vulnerable to attack by competitors who target smaller sectors of the market. In time this could guests to The Berkeley
mean the 'homogenous' product or service appeals less and less to the total market whose needs
are being satisfied elsewhere, and leaves them with fewer potential customers.
Fragmented industry

This article was created by --Philip Collard 14:48, 10 December 2013 (UTC)

Find out more

Related articles on Designing Buildings Wiki

Constructing a three year strategic marketing plan.
How many institutes an
Embedding successful key client management.
Marketing audit. construction industry po
Marketing planning. - 253...
One-year tactical or operational marketing plan.
 Winning work.
Railway tunnels

Share Add a comment Send us feedback

What are the longest ra

world? Find out here.

Flood resilience

An article examining ch
property flood resilienc

Draft London Plan

Sadiq Khan unveils pro
housebuilding, industria
venues.

Construction industry B

Major industry bodies w

to jump over a Brexit 'c

Construction sector dea

More detail is provided

Clark, which also reaffi
reduction objectives se
2025.

Risk register
What is the risk registe
construction and how d
responsibility?

Modern train stations

How train stations arou

to meet local needs.

Supply chain assessme

 Bryden Wood create a
tool to optimise the sup

Sprinklers

Estimating the cost of w

systems.

Industrial Strategy

A rather vague constru

to 'procuring for value'

Click here to see more

news.

© Designing Buildings Ltd. 2017 About Advertise Help Privacy Policy T&Cs Contact Feed