March 2003News
Access Control & Identity Management
Products & Solutions
Two years after the implementation of a new market segmentation philosophy by instrumentation specialist Endress+Hauser, the traditionally confusing instrumentation market in South Africa has settled into a structured, pragmatic environment that allows customers to accurately plan for capital projects and even annual maintenance expenditure.
Endress+Hauser spokesperson, Grant Joyce, believes the entire industry benefits from a clearly defined market that is easy to understand and evaluate. "From the buyer's perspective, there is no more confusion as to which version of which product is required for a particular application. Similarly, from a supplier's perspective, marketing has become easier, as our target market generally needs less education with regard to the basics of instrumentation."
Joyce compares Endress+Hauser's market segmentation philosophy to that used by auto manufacturers. "Say you are 30 and you want to buy a BMW. Chances are you will buy a BMW 316it compact instead of a BMW 520, not only because you cannot yet afford a 520, but also because you do not need that much space, as you do not have kids yet. The same is true for Audi, where you will buy an A3 rather than an A6. However, in 10 years time, your needs will have changed. Not only will you then be able to afford an A6 or 520, but you will probably prefer the more sophisticated image associated with the latter models," says Joyce.
"Now, let us carry that analogy through to a typical Endress+Hauser product, like the Cerabar pressure transducer. If you are a small business with only one or two points in your process where you need to use a pressure transducer, you would purchase a Cerabar T, which has fewer features and costs less than the Cerabar M," he continues.
"If you needed, say, 20 pressure transducers as an integral part of a medium-sized process, you would probably go for the Cerabar M, which is more accurate than the T, has higher stability specifications and can be programmed. Finally, for top-end plants, there is the Cerabar S. For the price premium at which the S is available, customers get the most accurate pressure transducer that exists, manufactured according to the most appropriate, customisable composition for your individual application, and with all the bells and whistles that one might hope to find on a pressure transducer."
This three-pronged market segmentation approach does not only bring the right product to buyers at the right price for the application, but fits with Endress+Hauser's philosophy of offering complete, scalable solutions that will allow customers to stay with the same supplier, from being a start-up company to becoming a large corporation.
Endress+Hauser’s three-pronged market segmentation approach brings the right product to buyers at the right price for the application
"It has brought price stability to the market and has also reduced capital expenditure, as there is no point in using a top-end product in a basic application. Going forward, our customers know what to expect from us, both in terms of price and product quality. After all, just like an Audi A3 is equal to an Audi A6 in quality, our products, whether a T, M or S, differ only in terms of features and functionality," concludes Joyce.
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