The specialty chemicals space is witnessing considerable growth owing to the rising demand for function-specific chemicals among the end-user segments. Growing concerns regarding pollution and environmental degradation are necessitating the need for chemical substances that generate lower greenhouse emissions. Specialty chemicals, at large, comprise of antioxidants, biocides, catalysts, enzymes, and specialty coatings. Moreover, the relentless demand for specialty chemicals among the construction segment for various residential projects and public infrastructure contributes to the growth of the industry.
Some of the factors that may curtail the growth of the specialty chemicals industry include:
- Aggressive competition: The specialty chemicals space is very competitive with the presence numerous offshore companies. Leading players in the chemical industry are facing the need to reduce their price offerings to gain a better market position. Moreover, it becomes essential for the companies to offer a differentiated set of products to pace up their position in the specialty chemicals space.
- Fluctuating raw material prices: The prices of raw materials keep on changing, and the producers at large find it difficult to bridge the gap between the production and selling cost. Prominent organizations are facing the need to maintain consistency in their product offerings while compromising on the costs. In addition, businesses should also ensure proper planning to bridge customer relationships and improve their profit margins.
To counter these challenges and understand customers’ attitude toward the products, businesses are leveraging market segmentation solutions. An effective market segmentation study offers insights into the needs, priorities, and common interests of the audiences and adequately allocate the resources to meet the business requirements. A market segmentation solution further helps businesses develop a targeted marketing approach to advertise and sell their products.
The Business Challenge
- The client- A renowned specialty chemicals supplier
The client, a renowned specialty chemicals supplier, wanted to identify different groups of purchasers in the market and target the products and services for each group. With the help of Infiniti’s market segmentation solution, the specialty chemicals supplier wanted to tailor their offerings for different groups and precisely meet the demands of the consumers. The primary objective of the client was to match their offerings with customers’ preferences and, in turn, improve their overall business efficiency.
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Our Approach
To identify the potential targets and implement a robust segmentation strategy, the market segmentation experts at Infiniti also carried out extensive research comprising interviews and discussions with prominent stakeholders in the specialty chemicals space. The experts also compiled information from a wide array of reliable sources such as paid industry databases, industry forums, and company presentations.
The Solution Benefits and the Business Impact
The market segmentation solution offered by Infiniti helped the specialty chemicals supplier efficiently target and track each group and meet the needs of each individual segment. The solution also assisted the client in identifying potential ways to split the market based on demographic criteria such as the socio-economic status. Moreover, the solution also helped the client re-define their advertising and media campaigns to enhance the return on investment. The market segmentation solution also offered insights on the ways to devise potential branding strategies to keep themselves relevant in this competitive market space.
The Future
The growth of the chemical industry will be characterized by the advent of new technologies. Moreover, the industry is also likely to witness a stipulated growth owing to the rising demand for chemicals among the end-user segments such as construction, clothing, and agriculture.
A must-read case study for strategy specialists and decision-makers looking to develop an understanding of the specialty chemicals industry
