HEST capital and operational expenditure data.
\\n\\n
More than half of the publishers listed alongside IntechOpen (18 out of 30) are Social Science and Humanities publishers. IntechOpen is an exception to this as a leader in not only Open Access content but Open Access content across all scientific disciplines, including Physical Sciences, Engineering and Technology, Health Sciences, Life Science, and Social Sciences and Humanities.
\\n\\nOur breakdown of titles published demonstrates this with 47% PET, 31% HS, 18% LS, and 4% SSH books published.
\\n\\n“Even though ItechOpen has shown the potential of sci-tech books using an OA approach,” other publishers “have shown little interest in OA books.”
\\n\\nAdditionally, each book published by IntechOpen contains original content and research findings.
\\n\\nWe are honored to be among such prestigious publishers and we hope to continue to spearhead that growth in our quest to promote Open Access as a true pioneer in OA book publishing.
\\n\\n\\n\\n
\\n"}]',published:!0,mainMedia:null},components:[{type:"htmlEditorComponent",content:'
Simba Information has released its Open Access Book Publishing 2020 - 2024 report and has again identified IntechOpen as the world’s largest Open Access book publisher by title count.
\n\nSimba Information is a leading provider for market intelligence and forecasts in the media and publishing industry. The report, published every year, provides an overview and financial outlook for the global professional e-book publishing market.
\n\nIntechOpen, De Gruyter, and Frontiers are the largest OA book publishers by title count, with IntechOpen coming in at first place with 5,101 OA books published, a good 1,782 titles ahead of the nearest competitor.
\n\nSince the first Open Access Book Publishing report published in 2016, IntechOpen has held the top stop each year.
\n\n\n\nMore than half of the publishers listed alongside IntechOpen (18 out of 30) are Social Science and Humanities publishers. IntechOpen is an exception to this as a leader in not only Open Access content but Open Access content across all scientific disciplines, including Physical Sciences, Engineering and Technology, Health Sciences, Life Science, and Social Sciences and Humanities.
\n\nOur breakdown of titles published demonstrates this with 47% PET, 31% HS, 18% LS, and 4% SSH books published.
\n\n“Even though ItechOpen has shown the potential of sci-tech books using an OA approach,” other publishers “have shown little interest in OA books.”
\n\nAdditionally, each book published by IntechOpen contains original content and research findings.
\n\nWe are honored to be among such prestigious publishers and we hope to continue to spearhead that growth in our quest to promote Open Access as a true pioneer in OA book publishing.
\n\n\n\n
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These aspects of forest fire are the subject of this book. I realize, however, that the contents in it can only be an incentive for the reader to learn more, in an interesting aspect. I assume that this book will be valuable to researchers as well as students who are interested in different aspects connected to forest fires, not only from the ecological point of view but also from the social one. 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He also works as a Honorary Senior Research Fellow at Birmingham University, UK, Lecturer at the Postgraduate European Institute, and has worked as Senior Manager in Accenture (2013-2014). He obtained his European PhD with a maximum distinction. He is a holder of the Runner Prize for Management Science and Engineering Management Nominated Prize (2020), Advancement Prize (2018), First International Business Ideas Competition 2017 Award (2017), Runner (2015), Advancement (2013) and Silver (2012) by the International Society of Management Science and Engineering Management (ICMSEM), and Best Paper Award in the international journal of Renewable Energy (Impact Factor 3.5) (2015). He has published more than 150 papers (65 % ISI, 30% JCR, and 92% internationals), some recognized as follows: “Applied Energy” (Q1, as “Best Paper 2020”), “Renewable Energy” (Q1, as “Best Paper 2014”), “ICMSEM” (as “excellent”), “International Journal of Automation and Computing” and “IMechE Part F: Journal of Rail and Rapid Transit” (most downloaded), etc. He is an author and editor of 25 books (Elsevier, Springer, Pearson, Mc-GrawHill, IntechOpen, IGI, Marcombo, AlfaOmega, etc.), and 5 patents. He is also an Editor of 5 International Journals and Committee Member of more than 40 International Conferences. He has been a Principal Investigator in 4 European Projects, 6 National Projects, and more than 150 projects for universities, companies, etc. He is an European Union expert in AI4People (EISMD) and ESF. He is Director of www.ingeniumgroup.eu. 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He is currently working as an Assistant Professor at the College of Computer Science and Information Technology, King Faisal University, in Saudi Arabia since 2008. He has contributed well in King Faisal University for achieving ABET Accreditation, by working as a member and Secretary for Accreditation and Quality cell for more than 08 years. He takes care of versatile operations including teaching, research activities, leading ERP projects, IT consultancy and IT management. He headed the department of IT, and administered the Prometric center in the Institute of Business and Technology (BIZTEK), in Karachi Pakistan. He has worked as a consultant for Network and Server Management remotely in Apex Canada USA base Software house and call center.\n\nDr. Noor Zaman has authored several research papers in indexed journals\\\\international conferences, and edited six international reputed Computer Science area books, has many publications to his credit. 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The green-house gas emissions associated with conventional electricity generation will lead to an increase in the average global temperature over the upcoming years, which in turn will lead to raised sea levels and more frequent extreme weather conditions and droughts. To mitigate such global climate changes, the world needs an energy transition that allows a cleaner and more sustainable energy supply.
The decarbonization of the world’s energy system has started in 2015 after the signature of the legally binding agreement by 195 countries to keep the global warming well below 2°C [1]. Since then, significant amounts of RES have been installed and integrated into the grid while securing the supply and the system resilience. Expanding the utilization of RES into the electricity grid however requires large-scale electricity storage to cover for their energy intermittency. Even a small-scale grid that handles only 10–30 gigawatts could not rely entirely on intermittent RES without having a gigawatt-scale storage that can work for many hours; so, for example, securing 3 GW for 2 days requires a 144 gigawatt-hours storage. There are many storage options; some of these are the flow batteries, which store the energy directly in the electrolyte, but are still in an early stage of deployment; sodium-sulfur batteries, with higher energy density than Li-ion ones; however, their hot liquid metal electrolyte is inconvenient; supercapacitors, which cannot provide electricity over a long enough time; and compressed air and flywheels have made it only to small and midsize installations due to location restrictions. Hydrogen energy storage however offers a clean, sustainable, and flexible storage option that can be scaled up to enable large-scale energy storage over long periods of time with no restrictions on location, and therefore it has the potential to enable the energy transition. While the transition toward using more variable RES into the power grid will unbalance the supply and demand, using the excess in the RES power supply in electrolysis to produce hydrogen and store it for future use during RES supply deficit can help balancing the grid. The stored hydrogen can also be used in other sectors like transport, industry, residential heat, etc. Implementing hydrogen energy storage with renewables therefore have the potential to improve the economic efficiency of renewable investments, enhance the security of power supply, and serve as a carbon-free seasonal storage supplying energy when the RES production is low or the energy demand is high.
This chapter explores the context of hydrogen as an energy vector and the role of hydrogen energy storage in the world energy transition. An exploration into the hydrogen technology techno-economic potential, its applications, achievements, and challenges to its deployment as well as recommendations for accelerating its deployment are covered in this chapter. This chapter also includes a model that has been developed to enable the quick sizing of a hybrid renewable hydrogen energy system (HRHES) that integrates solar and wind renewable resources combined with hydrogen energy storage to meet a specific electrical load. The effect of the electrolyzer thermal transients at start-up, when operated in conjunction with the intermittent renewable generation, on the quantity of hydrogen produced is included in the developed model. Implementing the developed model as a tool for identifying the performance issues within installed hydrogen systems during their operation is also given in this chapter. Two case studies are provided to verify the developed model, and to validate that thermally compensated electrolyzer models are essential for designing new hydrogen installations as well as for monitoring the performance issues within running installations.
Twenty-four percent of the global green-house gas emissions are produced from the electrical power generation sector [2]. Implementing RES into the power generation sector can play a vital role in reducing this emission percentage and accordingly address the climate change with its associated political, economic, and environmental pressures [3]. To enable the high penetration of fluctuating RES into the electrical power network, the network should be able to absorb and store the excess in the power fed so that they remain stable and should utilize the RES generation in the most possible effective manner. Delivering the RES generation to the load when needed and to the storage when the generation exceeds consumption allows the absorption of the excess in RES generation and thus reduces the need for the grid weak interconnections upgrading and remove a considerable amount of constraint issues. Additionally, implementing energy storage reduces the spinning reserve requirements and thus allows spinning reserve operational costs to be diverted to the EST operational costs [4].
The flexibility that the storage brings to the grid reduces the electrical supply and demand imbalance associated with increased RES integration, and thus facilitates energy transition. While the inclusion of energy storage brings some additional capital and operational costs together with energy conversion loss efficiencies [5] and although there is limited experience with implementing large-scale energy storage technologies (except for pumped hydro), the implementation of EST is still considered vital for enabling the projected increase of RES into the power network as a step toward achieving the energy transition [6].
Energy storage increases the power grid capacity in accommodating the increasing fluctuations in supply and demand, and thus it plays a crucial role in supporting the wider integration of distributed RES in modern electrical networks [7]. Integrating EST into electrical networks allows more flexibility in accommodating the increased amounts of RES [8].
In power systems, energy storage provides a method for “Load Leveling” by storing the power during periods of light loading and delivering it during periods of high demand, thus avoiding the high costs during peak demand and postponing investments in grid upgrades or in building new generating capacity. It also provides a method for “peak shaving,” which works like load leveling but aims to reduce the peak demand. Energy storage can also be used for “time shifting” by storing the energy during low price times, and discharging it during high price times. All these actions allow reduction in the grid’s energy management issues and improve the power quality. Figure 1 depicts how energy storage allows load leveling and peak shaving with conventional power plants, and Figure 2 depicts how implementing bulk energy storage with intermittent RES facilitates their high penetration into the electricity grid through storing the surplus in their energy to be used later to match the fluctuating load demand curve.
Energy storage for Load Leveling and Peak Shaving.
Energy storage with RES to enable their high grid penetration.
Energy storage is crucial for many applications and while implementing them in large size at the supply side can assist in the network bulk energy management, implementing them distributed near the consumer can assist in reducing power quality issues. EST energy storage duration ranges from few seconds of operation to several hours [9]. Figure 3 shows a summary of the different storage technologies with the applications in which they are best suited as conducted by the AEA technologies for the Scottish Government [10].
Energy storage technology overview, Scottish Government Report [10]. *SMES = superconducting magnetic energy storage.
It can be seen from Figure 3 that energy storage technologies that are best suited for short duration storage and low to medium power outputs are typically seen as performing better in improving the power quality, while EST that provide medium to high power outputs with long durations are better suited for the energy management of electrical networks.
Traditionally, the electrical network infrastructure has been designed to deliver electricity from several large-scale centralized fossil-fuelled electrical power stations to several domestic, industrial, and commercial consumers through a transmission network that is suited for power flow in one direction from generation to load. The hydrocarbon-fuelled and nuclear power stations are conventionally load following and can adjust their electrical generation output to follow demand, and thus the electrical grid maintains its equilibrium. When the network experiences any imbalance condition, the network operators implement control mechanisms to return the network to its balanced state. So, when generation cannot meet demand, the spinning reserve is connected to the electrical network and is loaded up according to demand. However, spinning reserve is a highly costly, carbon intensive, and inefficient method for maintaining the network stability as it requires the generating stations to remain running and consuming fuel to be brought online very quickly when needed to maintain the supply and demand balance.
The admission of the RES into the grid provides genuinely green energy at the points of entry; however, it creates a huge operational problem in managing the central generators to cover any transient variations in the renewable power input and consumer demand, thus hindering the renewable potential. The power network operators will have to manage the imbalance by either increasing the operation of the spinning reserve leading to increased costs [11], or by implementing other ways different from what they use with traditional power stations [12]. So, owners of RES connected to an increasingly congested electrical transmission and distribution network will have to incur financial penalties when they produce power at times of low demand and the network operators will have to pay compensations to RES owners when they introduce constraints [13]. An example of this is what happened at Scotland in April 2014, when strong winds made the Scottish grid not able to absorb all the wind power generated and had to constrain it off the grid while paying compensations to the owners of wind generators. Approximately £890,000 was paid over few hours to six wind farms.
Given that the global renewable energy contribution (excluding bio-fuels) is predicted to increase by over 50% between 2010 and 2035 [14], the electrical power networks therefore need to have the capacity to store the excess power fed into the grid from fluctuating and intermittent power sources [15]. The electrical power networks also need to continually achieve equilibrium under the increasing demand conditions while reducing their dependence on the expensive and inefficient spinning reserve, and thus it is crucial to increase their capacity through the implementation of energy storage technologies [16]. Therefore, it can be concluded that implementing EST is essential in modern power grids.
Hydrogen energy storage technologies are slowly but surely unlocking the potential of RES. Integrating HEST into the power networks not only allow the absorption of excess energy from fluctuating RES, but also allow the supply of supplementary energy needed when the RES production is insufficient to meet demand. Thus, HEST enable balancing the supply and demand while allowing the increased implementation of variable output RES.
Chemical energy storage in the form of hydrogen (gas or liquid) has the potential to store energy over long periods of time and can be scaled up with no restrictions on its location. Hydrogen can be used as an energy carrier, stored and delivered to where it is needed. The storage mechanism does not have high rate of self-discharge or degradation in performance. The basic elements of a hydrogen energy storage system (HESS) can be recognized in Figure 4. The electrolyzer (hydrogen generator) is used to convert the electrical energy from an energy source (typically renewable) into hydrogen for storage. The hydrogen storage system can store the hydrogen in several forms (pressurized gas, metal hydride, or liquid Dewar tank). A hydrogen energy conversion system then converts the stored chemical energy in the hydrogen back to electrical energy while giving off water and heat as by-products with no carbon emissions. The hydrogen energy conversion system that is commonly used is the fuel cell, given that its typical average electrical conversion efficiency, as recorded for installed projects, ranges between 40 and 50% compared with a maximum of 37% for a small combustion engine [17]. Alternatively, the stored hydrogen can be used for other end uses and thus hydrogen and oxygen gases are sold as commodities.
Basic elements of a hydrogen energy storage system (HESS).
A key barrier to realize the potential of hydrogen energy storage systems is the limitation in the available modeling software and tools [18]. Another challenge is the ability to quantify the energy capacity and economic viability of the hydrogen energy storage technology (HEST) when integrated into the electrical power grid to enable the projected increase of renewables. Addressing these challenges is the main key for accelerating the wide deployment of the hydrogen technology.
Hydrogen, as a form of energy storage, can deliver a fuel for making power or heat or for fueling a car while absorbing the intermittent power inputs from RES. Hydrogen production systems (electrolyzers) can be operated as deferrable and controllable loads within a smart grid infrastructure to allow the absorption of increased renewable energy generation in constrained power networks. The stored hydrogen can be used later in generating electricity when needed, or it can be used in other energy intensive sectors such as the gas grid, transport as a fuel, and industrial processes. Hydrogen storage is not geographically restricted and offers the potential to shift constrained renewable generation into other energy intensive sectors.
Large industrial and commercial consumers can play a vital role in balancing the grid through the intelligent use of their electrical loads while implementing hydrogen production and storage technologies. One example which demonstrates that hydrogen technology can be used for balancing the grid is what happens in “Tessenderlo Group,” a company which utilizes both oxygen and hydrogen gases in its chemical processing activities [19]. Tessenderlo utilizes one of the world’s largest scale hydrogen production systems, in the order of multiple Mega Watts (MW) scale [20, 21], and is charged at a lower cost/kWh in return to allow the local distribution network operator (DNO) to adjust its electrolytic hydrogen and oxygen production in maintaining the electrical network in the balanced state [22]. The DNO makes these adjustments in accordance with the demands on the electrical network using demand side management (DSM) techniques. The hydrogen production is reduced when the electrical network is experiencing a period of high demand and low energy production, and increased when the generation in electrical network exceeds consumption. Such a trading arrangement with a preferential tariff minimizes the need for the local network operators to waste money on highly inefficient spinning reserves. So, while utilizing the electrolyzer in maintaining the grid balance both hydrogen and oxygen gases are produced to be used in the chemical processes.
Hydrogen is in a strong position to be applied widely as an energy storage vector for balancing the grid while increasing the RES integration. Over the last decade, several renewable hydrogen concepts have been investigated [23] and several installations have been implemented to demonstrate the role of energy storage in the form of hydrogen in balancing the supply and demand in constrained grids. Many of these installations were based around small-scale RES of only a few tens of kilowatts, with exceptions to the hydrogen mini grid system (HMGS) in Rotherham, the Yorkshire [24, 25], the Utsira (Norway) energy system [26], and the Hydrogen Office [27], where large-scale RES have been utilized. All these systems have utilized commercially available alkaline electrolyzers with rated hydrogen production capacity in the range of 0.2–10 Nm3/h and operating pressures in the range of 7–20 bar, except the Hydrogen Office electrolyzer of 3.5 Nm3/h at 55 bar.
Hydrogen storage technologies can be divided into physical storage, where hydrogen molecules are stored (this includes pure hydrogen storage via compression and liquefaction), and chemical storage, where hydrides are stored. While chemical storage could offer high storage performance due to the strong binding of hydrogen and the high storage densities, the regeneration of storage material remains an issue with a large number of chemical storage systems still under investigation.
Demonstration projects have showed that hydrogen has a flexibility with RES, which is not available in other energy storage technologies. It has been found out that energy storage employing hydrogen technologies is best suited with renewable energy sources through the absorption of their surplus generation via electrolysis and storing it in the form of compressed hydrogen gas for later re-use in many applications such as the following:
Controllable generation reserve via fuel cells and/or gas turbines and/or internal combustion engines (ICE)
Fuel for transport applications
A means to transfer the renewable energy into the gas grid
A chemical process gas for other end uses in food, fertilizers, etc.
As the governments around the world are strategically moving toward a low carbon economy, hydrogen storage will undoubtedly play an important role in making use of the grid constrained “green” energy within a rapidly growing market [28].
Hydrogen can be stored for long periods of time without degradation. Hydrogen can be stored in a gaseous or liquid form, or in some instances adsorbed onto a solid form in the case of metal hydride storage technology. Hydrogen is mixable with other gases making it suitable for mixing into the existing natural gas grid in a process known as sector shifting [29]. Additionally, hydrogen can be used as reactive agent in the chemical transformations of synthetic natural gas and fuels.
Hydrogen is seen by many of the energy industry experts as a mean of storing the surplus renewable energy from sources such as wind, solar, wave, and tide [30, 31] for later use. It is also seen to have a market potential for vehicle fueling in both urban and remote rural areas [32, 33].
It can be noticed from Figure 3, which has overviewed the different storage technologies together with the applications in which they are best suited as conducted by the AEA technologies for the Scottish government, that hydrogen has a role to play in durations between several minutes to hours and is best suited for applications larger than 100 kW, and thus can be identified as appropriate for the Energy Management of Electricity Networks.
HES, when compared to the other ESTs, is seen to be suitable for use with RES [34]. In summary, the stored hydrogen produced during the RES excess generation periods can be:
injected into the gas grids (since it is mixable with other gases);
used to generate electricity and heat via a fuel cell;
used to power a fuel cell (FC) or a combustion engine’ vehicle; or
used in many industrial processes (like fertilizer production)
Figure 5 overviews the implementation of hydrogen energy storage with RES.
Implementing hydrogen energy storage with RES.
Despite of the benefits and potential that HEST presents, the high capital cost and the low turn-around efficiency (i.e., electricity to hydrogen stored then back to electricity) are two noteworthy limitations [35]. Significant efforts are being made by industry to address cost and efficiency concerns. Additionally, many countries have started the process of publishing draft guidelines for the use of hydrogen energy storage technologies [36].
To contribute to the effective and wider implementation of the hydrogen technology, especially where HESS are operated in combination with variable RES, appropriate financial mechanisms and effective modeling techniques are developed in this chapter.
Energy storage technologies are generally compared in terms of their lifetime, efficiency, energy density, power density, and technological-maturity [37]. They are also often compared based on application-specific benefits and specific characteristics of interest [38, 39]; however, such comparisons did not take into consideration their financial competitiveness.
Financial competitiveness of EST is to define the price of stored energy per kWh over the lifetime of the energy storage system. The Electric Power Research Institute (EPRI) has developed and documented a method that analyses the costs associated with grid connected energy storage applications [40]. The EPRI utilizes a levelized cost model (LCM) approach to perform the cost benefit analysis for energy storage technologies. The LC, in its basic form, is calculated by dividing the annual expenditures by the annual income and correcting for inflationary effects. The LC reflects the capital and operational expenditures including the upfront capital costs, the fuel expenses, the operating and maintenance (O&M) charges, the financing costs, etc. levelized cost analysis is often used in regulatory review and longer-term resource planning [41]. Levelized costs can be done using limited input data, thus useful for evaluating technologies with limited operating experience or available data.
The HEST has not been included in the EPRI analysis [42] or in other cost analysis modeling techniques available in literature. HEST appears to be commonly excluded from the cost comparative studies due to its high capital cost and low turn-around efficiency compared to other bulk ESTs. Even the studies that examined HEST have not included its additional revenue streams. So, a study that has been completed by the National Renewable Energy Laboratories (NREL) has introduced the value of grid connected stored hydrogen for transport applications [43], but did not consider the potential value of the oxygen gas as a by-product from electrolysis. Since the by-product oxygen would either have a positive or a negative effect on the cost competitiveness of HEST, therefore, a new LCM is developed in this section to explore this.
Figure 6 illustrates the economic revenue streams of both the conventional and hydrogen energy storage technologies. While conventional energy storage systems allow for energy to be stored and released in the form of electrical energy, hydrogen as an energy storage mechanism allows surplus RES electrical energy to be stored and released as electricity in addition to hydrogen and oxygen gases that could be sold as commodities offering greater financial competitiveness. Since this could offset the HEST low energy efficiency and high capital costs, it is considered in the developed HEST financial competitiveness model.
HEST possible economic revenue streams compared to conventional EST.
The costs of energy storage are considered using a levelized cost of ownership approach. Typically, the capital costs of an energy storage facility are expressed as £/kW installed, where it includes all expenses involved in the purchase and installation of facility. The £/kW capital expenditure (CapEx) multiplied by the size of the facility produces the total cost of the project. In the proposed model, all the costs related to an energy storage facility are expressed as (i) total £/kW of usable discharge capacity (in kW) and (ii) total £/kWh of usable energy storage capacity. EST with deeper Depth of Discharge (i.e., the ability of an ESS to release its stored energy) and higher turn-around efficiency (i.e., ratio between input energy and output energy) will have a lower unit cost of usable power and energy [44].
Using the levelized cost approach, the levelized storage cost (LSC) of energy storage technology can be expressed as shown in Eq. (1) [41]:
where ISCt is the invested storage capital in year (t); SOMt is the storage operation and maintenance costs in year (t); ECt is the input energy cost (t); r is the annual discount rate (typically 10%); and EOt is the value of released energy in year (t).
The LSC for the hydrogen storage technology will have additional revenue potential realized in the sale of both hydrogen and oxygen gases as a commodity. Equation (1) is therefore expanded to include H2t and O2t, and the LSC is expressed as shown in Eq. (2):
where H2t is the value of sold hydrogen gas year (t) and O2t is the value of sold oxygen gas in year (t).
To evaluate the economic competitiveness of hydrogen energy storage systems utilizing the “surplus” or “grid constrained” renewable energy generation, several configurations are considered here to conclude the most economic scenario.
Scenario 1: Selling 100% of the hydrogen and oxygen gases produced by electrolyzer, and no electricity to sell (i.e., no fuel cell electricity generation).
Scenario 2: Selling 100% of the H2 gas stored as electricity injected back to the power grid through the FC electricity generation (i.e., no H2 gas to sell), and selling 100% of the O2 gas.
Scenario 3: Selling 50% of the produced hydrogen as gas while the other 50% is sold as electricity to the grid via the fuel cell, and selling 50% of the oxygen as gas while the remaining 50% is vented to the atmosphere (i.e., not making use of half the produced oxygen value).
Scenario 4: Selling 100% of the hydrogen as gas (i.e., no fuel cell generation and no electricity to sell) and no selling of oxygen gas (i.e., not making use of all the produced oxygen value).
Scenario 5: Selling 100% of the stored hydrogen as electricity back to the power grid (i.e., no H2 gas selling), and no O2 gas selling (i.e., not making use of all the produced oxygen value).
Note that, Scenarios 4 and 5 do not utilize the by-product oxygen gas.
These five scenarios are tested on the “hydrogen office” energy storage system, as a case study, and the levelized cost per unit output is calculated for each scenario using Eq. (2). The Hydrogen Office, in Methil Docks Business Park in Scotland, employs a wind/hydrogen energy storage system that has been installed to demonstrate the potential of HES in storing surplus renewable energy. The Hydrogen Office’s main components are shown in Figure 7, the Capital expenditure (CapEx) and Operational Expenditure (Opex) data are given in Table 1, and the market value for the by-product H2 and O2 gases is given in Table 2 [34].
The Hydrogen Office simplified system overview.
CapEx & OpEx data | |
---|---|
Hydrogen CapEx | |
Electrolyzer (£/kW) | £ 2500.00 |
Storage (£/kWh) | £ 27.00 |
Fuel cell (£/kWh) | £ 4000.00 |
Hydrogen OpEX | |
Electrolyzer (£/kW) | £ 50.00 |
Storage (£/kWh) | £ 2.00 |
Fuel cell (£/kW) | £ 100.00 |
HEST capital and operational expenditure data.
Market data | |
---|---|
O2 Sale (£/Ton) | £ 3000.00 |
H2 Sale (£/Ton) | £ 5000.00 |
Market value for hydrogen and oxygen gases.
Figure 8 shows the LSC results for the five scenarios. It can be seen from figure that the most financially competitive configuration for the hydrogen energy storage technology is realized in Scenario 1. A favorable result is also seen in Scenarios 2 and 3. The least competitive configuration is seen in Scenario 5 when none of the gases is sold as commodity. Although hydrogen has a high financial value when sold as a gas, Scenario 4 demonstrates that it is not competitive when sold on its own.
The LCM simulated output costs for the HEST scenarios.
It can be concluded from Figure 8 that the hydrogen energy storage technology has a great potential and financial benefit in enabling the projected increase of renewable generation into the electrical network as it allows alternative economic pathways for the surplus renewable generation. The stored hydrogen is not only limited for electricity production, but can also be sold for another end uses. Moreover, HEST has the most economic potential when its by-product oxygen is sold as well.
The HEST levelized cost is then compared to the levelized costs of other conventional energy storage technologies as obtained from a research conducted by NREL and summarized in Table 3 [45]. Figure 9 illustrates this comparison.
Technology | Levelized storage cost (LSC) |
---|---|
NiCd battery | £ 0.52 |
NaS battery | £ 0.16 |
Radox flow battery (RFB) | £ 0.17 |
Pumped hydrostorage (PHS) | £ 0.08 |
Compressed air energy storage (CAES) | £ 0.06 |
Levelized costs of other energy storage technology [45].
The levelized cost of HEST versus the levelized costs of other conventional energy storage technologies.
It can be seen from Figure 9 that CAES and PHS are more cost competitive than the five HEST scenarios proposed. This shows that there is still a need for reducing the HEST CapEx or increasing its turn-around efficiency to increase its financial competitiveness. However, HEST can compete with NaS and RFB technologies when it is used in conjunction with the oxygen gas by-product selling. Additionally, HEST competes with NiCd battery technology when only 50% of the oxygen gas is sold and half the hydrogen is sold as gas and the other half as electricity. HEST is not competitive when used for only selling electricity (Scenario 5) or only selling H2 gas (Scenario 4) without selling the O2 gas.
All energy storage systems have varying degrees of inefficiency (turn-around efficiency), with typical efficiency ranging from 45 to 80%. Hydrogen energy storage systems’ efficiency can be considered higher especially when implemented with RES because of the following:
The efficiency of electrolysis is high.
They commonly utilize a fuel cell that has a conversion efficiency a lot higher than that of the combustion engine technology.
Their efficiency can be increased by utilizing the output heat from electrolyzers and fuel cells in process heating.
When utilized with RES, they capture and store the excess in renewable energy that would have otherwise been dumped and this in turn adds to their efficiency.
They do not only store the electrical energy for future re-use like all other conventional ESS, but also allow both hydrogen and oxygen gases to be sold as commodities thus increasing the system economic efficiency. The 3:1 increase in revenue options, shown in Figure 6, opens the potential for downstream applications like car fuelling, fertilizer production, and high and low-grade heat applications in addition to electricity.
The available sizing models are either Commercial software (like EMCAS, EnergyPLAN, energyPRO, GTMax, IKARUS, Invert, MiniCAM, NEMS, ORCED, PERSEUS, ORCED, PERSEUS, PRIMES, ProdRisk, RAMSES, RETScreen, SIVAEL, STREAM, WASP, and WILMAR [46, 47]) or standalone modeling techniques. The commercially available software does not offer simulating the HEST as part of a hybrid renewable energy system, and those which can [like HOMER, BALMORAL, H2RES, ENPEP-BALANCE, HYDROGEMS (incorporated into Transys16), SimREN, and UniSyD3.0] require a significant quantity of input data and substantial computing resources to perform well and still some of them are not capable of sizing the hydrogen energy system. The more advanced standalone modeling techniques, like genetic algorithms (GA), particle swarm optimization (PSO), and simulated annealing (SA) need significant computing resources.
To address the large input data requirements of the commercially existing software and the significant computing resources needed by advanced GA, PSO, and SA techniques, a new deterministic sizing methodology that offers a rapid initial system sizing of a hybrid renewable hydrogen energy system (HRHES) with the minimal amount of input data and computer resources is given here. This simple technical sizing technique, referred to as deterministic [48, 49], can provide a rapid and reasonably accurate system sizing [50] while using limited number of input data. This approach can therefore play an important role at the initial design phase of HRHES.
To demonstrate the proposed new deterministic sizing methodology that offers a rapid initial system sizing of a hybrid renewable hydrogen energy system (HRHES) with the minimal amount of input data and computer resources and thus supports its initial design, a HRHES sizing model is developed here based on the presence of solar and wind as the renewable resources combined with HEST to meet the demands of an electrical load. The outline of the developed deterministic sizing algorithm is shown in Figure 10 and is detailed in the following subsections.
The proposed deterministic sizing algorithm.
The first criterion in sizing a HRHES is sizing the renewable energy sources (RES). The objective of including the RES generation into the sizing routine is to minimize the difference between the average load demand (
The capacity factor (CF) is defined as the average power output (
where
Given that sizing the wind turbine is usually restricted to the unit sizes available in the market, which in general are 3, 5, 6, 10, 15, 20, 50, 250, 330, 500, 850, 900, 1200, 2200, 3200 kW, and thus the wind turbine is sized first. The average power of the wind turbine (
The rated power output for the wind turbine is then calculated using the proposed wind turbine model given by Eq. (5). Note that, the annual average site wind speed is calculated using Eq. (6) and the wind turbine rotor coefficient of performance (Cp), which is a measure of wind turbines blade rotor effectiveness at converting the power in the wind to mechanical power, is calculated using Eq. (7).
where λ is the tip speed ratio, ratio of the wind speed, and the speed at which the wind turbines rotor tips are traveling, and it is found using Eq. (8); and B is the blade’s pitch angle.
where n is the turbine RPM; D is the turbine rotor diameter; and v is the wind speed.
The second step is to define the rated power of the supporting PV array (
After sizing the RES, the size of the electrolyzer (
When the load demand exceeds the renewable generation, this deficit is met by the fuel cell generation. The fuel cell converts the chemical energy of the stored hydrogen into electrical energy to supply the demand. The fuel cell size is selected to meet or exceed the load maximum power demand
The RES are first sized to supply a specified load on an annual average basis using Eqs. (3)–(9). Sizes of the appropriate electrolyzer and fuel cell are then identified using Eqs. (10) and (11). Because there could be times when there is no or insufficient renewable generation to supply the demand, assessing the correlation of the load demand and renewable generation is therefore needed. Simulating the energy system without storage, as shown in Figure 11, using the load and calculated sizes for PV and wind turbine allows to identify the correlation between the load demand and renewable generation.
Simulating the system without energy storage.
The difference between the load demand and the renewable generation at different timings can be found by subtracting the load demand from the renewable resource value for each recorded sample. Summing the differences for all the sample intervals yields a negative value, indicating a supply deficit, which defines the energy storage size. Equation (12) defines the size of energy storage (ES) needed to cover this deficit.
The hydrogen storage tank must be sized to hold enough hydrogen for the fuel cell to deliver the energy requirements (
where
The average volume of hydrogen (
A great challenge that faces the application of renewable-powered hydrogen energy storage systems is the ability to accurately determine the hydrogen production of an electrolyzer running on RES. Other challenges include their high costs and the need to guarantee their reliable and safe operation. A way forward toward achieving cost reduction is to lower their operation and maintenance costs by improving the hydrogen production efficiency and the system performance [53]. To achieve this, while ensuring safe system operation, the HES system must be able to handle the hydrogen gas securely and any leak must be quickly identified. If this is not the case, any leakage will impact the overall system efficiency and the operation cost and could result into a potential safety hazard as well.
To address these challenges, a model that includes the thermal compensation effect to accurately simulate the hydrogen production from an electrolyzer fed by RES is developed in this section. The developed thermally compensated electrolyzer model can also be used as a tool to detect any H2 leakage and identify performance issues within an operational electrolyzer. The developed model, when implemented on working HES systems, allows the identification of hydrogen leakages without the need for maintenance inspection thus reducing the operating costs.
Ignoring the effect of temperature on the electrolyzer hydrogen production, as the case with HOMER, may lead to unrealistic simulation results because the electrolyzer production efficiency at lower temperatures is lower than that at full production temperature. This result has been illustrated when the developed model was implemented on a 30 kW electrolyzer, as a case study, to simulate the effect of temperature across its full range of hydrogen production. Figure 12 demonstrates the impact of heat compensation on the electrolyzer hydrogen production efficiency.
Impact of heat compensation on the efficiency of a 30-kW electrolyzer.
The developed model is based on the combination of heat transfer theory, fundamental thermo-dynamics, and empirical electrochemical relationships, as measured from operating systems. The developed model is detailed in the following subsections.
To identify the effects of thermal transients on the overall hydrogen production from an electrolyzer, a three-step algorithm is developed as shown in Figure 13. The first step involves simulating the hydrogen production from a renewable-powered electrolyzer with the electrolyzer model compensated using the effects of temperature on its hydrogen production. The second step involves repeating the simulation, but with the electrolyzer temperature fixed at its full working temperature (i.e., effects of thermal transients ignored). In the final step, the overall effect of thermal transients on hydrogen production is calculated by subtracting the step 1 hydrogen output of thermally compensated model from the hydrogen output of the fixed temperature model of step 2.
Proposed algorithm to identify the impact of thermal transients on the electrolyzer hydrogen production.
A robust electrolyzer model, shown in Figure 14, is developed in this section to be used in the proposed algorithm to identify the effects of thermal transients on the overall hydrogen production. To formulate an accurate and robust electrolyzer model that can accurately predict the electrochemical and thermal dynamic behavior of an advanced alkaline electrolyzer, the model is developed based on Øystein Ulleberg model [19] while integrating the voltage/current U-I relationship, the faraday efficiency, as well as the thermal and the pressurized hydrogen storage modeling components.
Incorporating the effect of thermal transients in electrolyzer model.
An electrolyzer operating characteristic is determined by its voltage and current profile. The quantity of hydrogen produced by an electrolyzer varies with the amount of current passing through the electrolytic cell stack. The electrolytic cell voltage develops as more current is absorbed by the electrolyzer to increase the gas output flow. This U-I relationship would be a straight line for an ideal electrolyzer; however, it is a nonlinear relationship due to losses occurring in the electrochemistry and cell structure. The relationship is affected by the ohmic resistance of the electrolyte and electrodes as well as the parasitic loss of “stray” electrolysis. The parasitic loss of stray electrolysis is a phenomenon where the electrons flow down the electrolyte fluid channels instead of flowing directly between the electrodes themselves.
The voltage (U) required to breakdown the water to produce hydrogen can be expressed in terms of (Urev). The voltage required to facilitate the electrolytic dissociation of water molecules is temperature dependent and can be expressed as shown in Eq. (15).
where U is the water breakdown (or hydrogen production) voltage (V); Urev is the overvoltage beyond reversible electrochemical cell voltage; r1,2 is the empirical ohmic resistance parameter of electrolyte (Ωm2); T is the temperature (K); t1,2,3 is the empirical overvoltage parameter of electrode (mA−1 m2); s is the overvoltage parameter of electrode (V); A is the electrode area (m2); and I is the current (A).
The reversible cell voltage (Urev) is calculated using the empirical Nernst equation for electrolysis given by Eq. (16) [20].
The Faraday efficiency is the ratio between the actual and maximum theoretical hydrogen mass that can be produced by an electrolyzer. Faraday efficiency losses are caused by parasitic current losses within the electrolysis cell stack. The parasitic current loss increases as a percentage of the overall current with the decreasing current densities and increasing temperatures. Therefore, the percentage of parasitic current loss to the total current flow increases with decreasing current densities. An empirical equation for the Faraday efficiency is shown in Eq. (17).
where ηF is the Faraday efficiency; A is the electrode area (m2); I is the current (A); f1 is the Faraday efficiency parameter mA2 cm−4; f2 is the Faraday efficiency parameter (number between 0 and 1); and f1 and f2 are selected empirically.
Faraday’s law also models the production rate of hydrogen in an electrolytic cell. The production rate of hydrogen is directly proportional to the transfer rate of electrons at the electrodes. This is equivalent to the electrical current provided by the power supply. Therefore, the total hydrogen production rate in an electrolysis stack consisting of several cells connected in series can be expressed, as shown in Eq. (18).
where
The production of heat in an electrolyzer is primarily caused by electrical inefficiencies. The energy efficiency can be calculated from the thermo-neutral voltage (Utn) and the cell voltage (U) using Eq. (19).
where ηe is the energy efficiency; Utn is the thermo-neutral voltage
The value for Utn remains almost constant within the pressure and temperature range considered here (0–1200 kPa pressure, 0–80°C temperature), this value is 1.477 V [21].
The operating temperature of an electrolyzer can be found from the overall thermal energy balance of the electrolysis system. The thermal energy balance of the electrolyzer can be expressed, as shown in Eq. (20), where Eq. (21) calculates the thermal energy created by the electrolysis process, and Eq. (22) is used to calculate the thermal losses of the electrolyzer system. Equation (23) is applied to maintain the electrolyzer temperature at or below the maximum temperature specified by manufacturer; it is assumed that electrolyzer cooling system is sufficient to remove the excess heat generated by the electrolysis process.
where
To calculate the electrolyzer temperature as time passes (T), it is assumed that the electrolyzer exhibits a constant heat generation and heat transfer profile for a small-time interval of not more than a few seconds. An intra-time-step steady-state thermal model can be expressed, as shown in Eq. (24), where Tini is the initial temperature and Δt is the change in time.
When hydrogen is produced by the electrolyzer, there is a need to store it and therefore there is a need to include hydrogen storage modeling to the proposed model. The two main components needed to model pressurized hydrogen storage is the formula for the pressure considering the gas behavior and the compressibility factor Z.
The ideal gas relationship can be used to describe the behavior of real hydrogen gas accurately only at relatively low pressures up to approximately 1450 psig and at normal ambient temperatures, results then become increasingly inaccurate at higher pressures. One of the easiest ways to account for this additional compression is through the addition of a compressibility factor, designated by the symbol Z. The Z factor is derived from the data obtained through experimentation and it depends on temperature, pressure, and on the nature of the gas. The Z factor is used as a multiplier to adjust the ideal gas law to fit into the actual gas behavior, as shown in Eq. (25).
where P is the absolute pressure in Pascal; ρ is the density; T is the absolute temperature in Kelvin; and R is the universal gas constant, 8.31434 Nm/mol K.
Calculating Z: The National Institute for Standards and Technology has developed a mathematical method for calculating compressibility factors accurately using a virial equation based on pressure (MPa) and temperature (K) [22]. The compressibility factor for hydrogen at different pressures and temperatures can be calculated to a high degree of accuracy by using Eq. (26) and the constants listed in Table 4 [23, 24].
I | ai | bi | ci |
---|---|---|---|
1 | 0.05888460 | 1.325 | 1.0 |
2 | −0.06136111 | 1.87 | 1.0 |
3 | −0.002650473 | 2.5 | 2.0 |
4 | 0.002731125 | 2.8 | 2.0 |
5 | 0.001802374 | 2.938 | 2.42 |
6 | −0.001150707 | 3.14 | 2.63 |
7 | 0.9588528 × 10−4 | 3.37 | 3.0 |
8 | −0.1109040 × 10−6 | 3.75 | 4.0 |
9 | 0.1264403 × 10−9 | 4.0 | 5.0 |
Constants to calculate Z.
Molar mass: M = 2.01588 g/mol.
Universal Gas Constant: R = 8.314472 J/(mol K).
where the equation and its constants are defined for pressures in Mega-Pascal (MPa) and temperatures in Kelvin (K).
The previously developed modeling equations are used in this section to develop a MATLAB-Simulink model. The developed MATLAB model is then used in a novel way to assess the integrity of operational real-life hydrogen installations.
The hydrogen generation and storage mathematical model, described by Eqs. (15)–(26), is implemented under the Simulink framework to develop the MATLAB Simulink model. Figure 15 illustrates the interaction between the developed MATLAB Simulink subsystems for the U-I model, the Faraday efficiency model, and the thermal model but without any thermal compensation. The pressurized modeling is not shown in Figure 15, but it has been accounted for through the H2 Molar Mass.
Interaction between the U-I, the Faraday efficiency and the thermal subsystem models in MATLAB/Simulink.
However, the simulation results for this model do not reflect the real hydrogen installations results, and thus the developed model is modified to include a newly added thermal compensation factor which is detailed in the next subsection.
Simulating an electrolyzer without considering the thermal compensation leads to a nonnegligible error in the simulation which can lead to a miscalculation of the return on investment (ROI). This is especially true during a cold start of an electrolyzer. An electrolyzer is said to be in a cold start when it is switched on in any of the following situations: (i) the electrolyzer is cold (not heated up and not at its standard operating temperature), (ii) not under pressure. Note that a standard operating temperature for an alkaline electrolyzer is about 80°C; for a proton exchange membrane (PEM) electrolyzer, it is about 70°C; and for a solid oxide electrolyzer (SOE), this varies with the material being used to construct the cells. In a cold start situation, the electrolyzer is cold and not under pressure and thus its efficiency is low as it requires pressurizing and heating itself up. This takes a short time if the electrolyzer is small; however, this time dramatically increases as the size of the electrolyzer increases. For alkaline electrolyzers, this time may be 1 s for small ones but can take up to several minutes for large ones; however, time is less for the PEM technology. The developed thermally compensated model will therefore be focused on alkaline electrolyzers as they are the ones that suffer the most from heat compensation effect.
To simulate the practical operation of an electrolysis system, it is important to include compensation of the effects of temperature on the electrolytic process. The exothermic thermal reaction that takes place during electrolysis in an alkaline electrolyzer impacts the energy efficiency of the gas generation process and especially the UI relationships. In other words, as hydrogen is being produced by the electrolyzer, an electrochemical reaction takes place at the electrodes. This reaction heats up the electrolyte and the associated electrode materials (this is known as the exothermic reaction) resulting into an increase in temperature which leads to reduction in the cell voltage and cell current needed to generate the hydrogen gas. In other words, the increase in the electrolyzer temperature reduces the power requirements of the electrolytic cells for the same hydrogen production, thereby increasing the system efficiency.
Integrating the thermal model within the previously developed electrolyzer model enables the thermal energy efficiency to be incorporated, and thus allows the model to generate output data that is extremely close to the real-world electrolyzer performance. Figure 16 depicts the thermally compensated architecture included in the developed Simulink model. The new model considers the thermal energy generated by electrolysis (Qgen), the thermal capacity of the electrolyzer itself to absorb and dissipate thermal energy (Qloss), and the cooling system to maintain the thermal equilibrium required for an efficient hydrogen generation (Qcool) and utilizes Eq. (23) to calculate the thermal balance of the electrolytic process.
The thermally compensated model developed under MATLAB/Simulink framework.
Two case studies are provided in this section to verify the developed model and validate that thermally compensated electrolyzer models are critical not only for designing new hydrogen installations, but also for monitoring the performance of operational ones. These case studies are carried out on two real-world field installed systems. The first one is used to verify that the developed model can accurately simulate hydrogen energy systems. The second is used to verify that the developed model can be used as a tool for investigating the operational integrity of operating electrolyzer systems and checking their performance while identifying any failures to support the reduction in maintenance requirements.
A 30 kW real-world alkaline electrolyzer, which is operational within an existing hydrogen installation, is chosen to verify that the developed electrolyzer Simulink model can accurately simulate it. This 30 kW alkaline electrolyzer can develop 5.3 Nm3/h of hydrogen at a pressure up to 1200 kPa. It consists of two electrolytic cell stacks; each stack has 90 cells configured in a series connected array. The electrolyzer is designed to operate at a temperature of 60°C. Figure 17 shows the electrolyzer (i.e., the hydrogen generator) connected to a 4800 L gas bottle array for the storage of the generated hydrogen at a pressure up to 1200 kPa.
Hybrid renewable H2 generation and storage.
Table 5 gives the values for the electrolyzer variables, while values for the variables of the modular hydrogen storage system which is connected directly to the electrolysis system are given in Table 6.
Variable | Description | Unit | Value |
---|---|---|---|
r1 | Electrolyte ohmic resistive parameter | Ωm2 | 0.0000805 |
r2 | Electrolyte ohmic resistive parameter | Ωm2 | −0.0000025 |
A | Electrode area | m2 | 0.37 |
S | Overvoltage parameter of electrode | V | 0.19 |
t1 | Empirical overvoltage parameter of electrode | A−1 m2 | 1.002 |
t2 | Empirical overvoltage parameter of electrode | A−1 m2 | 8.424 |
t3 | Empirical overvoltage parameter of electrode | A−1 m2 | 247.3 |
f1 | Faraday efficiency parameter | mA 2 cm−4 | 200 |
f2 | Faraday efficiency parameter | 0….1 | 0.94 |
Vstd | Volume of ideal gas at STP | m3 mol−1 | 0.0224136 |
Rt | Thermal resistance of electrolyzer | W−1K | 0.018 |
Thermal capacity of electrolyzer | JK−1 | 300,000 | |
Number of cells in electrolysis stack | N | 180 | |
Ta | Ambient temperature | °C | 20 |
Tmax | Maximum operating temperature of electrolyzer | °C | 60 |
Thyst | Cooling hysteresis thermal band | °C | 3 |
Electrolyzer variables—variables for the 30 kW alkaline electrolyzer.
Variable | Description | Unit | Value |
---|---|---|---|
V | Tank volume | m3 | 4.8 |
Ta | Ambient temperature | °C | 20 |
Variables for the hydrogen storage—4800 L void capacity.
A data-log of the current consumed by the real-world electrolyzer while in operation is given in Figure 18. The electrolyzer temperature and pressure responses to the current are also recorded and compared to the results from the developed Simulink model, as illustrated in Figures 19 and 20, respectively. Both figures demonstrate that the developed model results are very close to the data collected from the operating electrolyzer, thus confirming that the developed model can be used for accurately simulating real-world installations.
Data-log of the current consumed by 30-kW electrolyzer while in operation.
Recorded electrolyzer temperature versus model output.
Recorded electrolyzer pressure versus model output.
On further analyzing Figure 19, it can be noticed that the electrolyzer is switched on at time 133 s (cold start) and it reaches its operating temperature (and pressure) at time 309 s; thus, the time taken from the cold start to the operating temperature is 176 s. This means that the electrolyzer almost took 3 min to reach its operating conditions and substantial amounts of hydrogen will not be produced during this time. If such a small electrolyzer took 3 min to reach its steady-state operation, then it can be tangibly assumed that this time will be much higher for a larger scale electrolyzer and substantial loss in hydrogen production could be realized. Considering the financials, it will be consequently affected by the loss in the hydrogen production during the cold start period. It can therefore be concluded that the inaccurate hydrogen production numbers generated from nonthermally compensated hydrogen generators simulation models will generate misleading higher ROI values. Thus, it can be also concluded that the developed thermally compensated simulation model is essential for accurately calculating the potential for financial return of a hydrogen system since it allows the accurate computation of hydrogen production.
The thermally compensated electrolyzer model is further tested in one of the most unexploited applications for any model—its use in a postinstallation scenario. When an electrolyzer model is developed, it is usually used in the preinstallation stage to investigate if the planned system will operate as anticipated when installed in the field. In this section, the developed model is further used in a postinstallation scenario to demonstrate that it is also capable to detect issues within operating systems removing the need for maintenance crew on-site inspection.
The developed Simulink model was used to simulate an operating hydrogen generator when its performance was detected to be not as anticipated for a couple of weeks. It was suspected that the electrolyzer has developed an internal issue, so the aim was to examine if the developed model can be used in a post-installation situation to determine this performance issue. The operating hydrogen system, on which the developed Simulink model was tested in a postinstallation scenario, is been operating in Africa for over 8 years and it employs a 30 kW alkaline electrolyzer identical to that given in Table 5 connected to a storage system of 2499 L void volume capacity. On comparing the model output results to the on-site collected data, two performance issues were doubted. The first was an early degradation of the stack; however, this was disregarded as none of the other similar installed stacks illustrated such a drastic performance issue. The second was the presence of a hydrogen leak; and this was clear from the divergence between the modeled and recorded data shown in Figure 21. The figure shows that there was more H2 production in the model results than what was achieved in the practical installation, and this in turn suggests a leak within the installed system. This suggestion was confirmed by an on-site inspection of the hydrogen system which revealed that a fitting in the pipe that carries the H2 gas from the electrolyzer to the storage system had developed a premature failure. The fast rate of detected leak spray bubbling, shown in Figure 21, indicates the presence of a leak on two sides of the faulty pipe fitting shown in Figure 22. This finding clearly demonstrates the apparent benefit of the developed model in identifying leakages during operation, and thus it can save the time and cost of maintenance inspection as well as preventing the safety hazards associated with the hydrogen vented in atmosphere.
Divergence between the modeled and recorded pressures indicating a suspected hydrogen gas leak.
Source of leakage identified after on-site inspection.
The developed thermally compensated model has been able to reveal this hydrogen gas leak, which was about 10.89 g, equating to a 2.3% reduction in the overall system efficiency. This leak was so small for the leak detection system to detect; therefore, if many small leaks like this occur at different locations of a large-scale system without being detected by the safety alarm system this could lead to more financial losses and potentially a hazardous situation. Therefore, the developed model can be used as a tool to provide an early warning of leakages or other issues, and thus provided an extra layer of safety and a potential for increasing the financial return through the development of a predictive maintenance system.
In conclusion, the contributions to knowledge that has been presented within this chapter can be summarized as follows:
A novel levelized cost model has been developed for investigating the financial competitiveness of the hydrogen energy storage technology. It has been identified that hydrogen use as an energy storage mechanism achieves the most financial competitiveness when the by-product oxygen is utilized.
A new deterministic sizing methodology that offers a rapid initial sizing of renewable hydrogen energy storage systems has been given. The proposed method requires a very limited number of input data to offer an initial system size for a hybrid renewable hydrogen energy storage system (HRHES) very quickly, and thus it is useful at the very early initial design phase to assist in the early decision-making for system implementation. To develop this sizing model, a model has been developed for every single item in the proposed HRHES (the implemented renewable energy sources, the electrolyzer, H2 storage, and fuel cell). These models were then integrated together.
An algorithm for modeling the impact of thermal transients, especially in alkaline electrolyzers, on the overall hydrogen production has been developed. The prolonged thermal transients, associated with electrolyzers fed by renewable energy sources, result into extended periods of time where the electrolyzer does not produce hydrogen at its highest efficiency, and thus resulting into an overall reduction in its hydrogen production. The typical effect of thermal transients on the electrolyzer hydrogen production can be found by using the proposed algorithm, and a reduction in the cumulative hydrogen production was found to be in the range between 1 and 3%.
The thermally compensated electrolyzer model has been developed in Simulink and has proven, through a case study, to be able to accurately simulate hydrogen generation and storage systems. The developed model presents a key finding for the hydrogen industry as it does not only allow the investigation of hydrogen systems performance in a preinstallation scenario prior to embarking into the expensive capital investment, but also proven to be useful in postinstallation scenarios. The developed model was found to be able to simulate operational installed hydrogen systems and assist in identifying their performance issues accurately.
The global marketplace is highly competitive. In these hyper-competitive marketplace manufacturers, distributors and marketers trade goods and services for money, time, testimonials, information, and referrals from consumers across country borders. For organizations (representing manufacturers and other stakeholders in the distribution and sales of products) to most suitably develop/focus their product and service offerings on satisfying the unique needs and demands of a variety of prospects and consumers, marketers divide the market into groups, called segments. Understanding the needs and wants of a select group of consumers is imperative to sustainable business success in this hyper-competitive space. Marketing is the process of identifying and studying consumers’ dynamic needs, thus enabling marketers to create, capture, and communicate offerings that represent value to customers, clients, and society at large. Marketing communication aims to deliver value exchange between the marketing entities and consumers [1]. The exchange between an organization (a person, firms, retailers, wholesalers, NGOs, governments, associations, industries) and a consumer (individual customer or business buyer) will only take place if the offering (product, service, idea, knowledge, information, experience) is seen as “of value” to the prospective buyer(s). Also, an acceptable level of trust needs to exist between the parties involved in the exchange. Therefore, good marketing communication that delivers an exchange that satisfies both parties (buyer, seller, and other stakeholders), requires a clear vision, thoughtful planning, and well-targeted activities. To offer genuine value to current and future customers, the overall market is segmented into categories of consumers with fairly similar, homogeneous needs and wants, similar access points and of whom engage with similar communication channels to gather product knowledge and information. Several segmentation models exist, and we will discuss those later in this chapter.
“Marketing is aimed at satisfying customer needs and wants”.
Consumers are only likely to purchase products and services (combined we call them offerings) that satisfy conscious needs and wants or when awareness of offerings results in impulsive buying due to perceived value or perceived benefits. These needs and wants become demands when consumers have both the intention to purchase an offering and the money to turn their wants into a purchase—often of a very specific (sometimes branded) product or service. Needs may range from physiological needs like thirst and hunger to psychological needs such as acceptance to a particular group. Hedonic needs and desires such as aspiring to be recognized as a top achiever may also impact consumers’ decisions. For example, some consumers may buy a leather case for its functionality durability (functional needs), while others may buy a leather briefcase to fit into their professional dress code (social needs), while another group of briefcase buyers may simply buy it for the implied status of and recognition that comes with carrying an expensive (a hedonic need to indicate status), Louis Vuitton briefcase.
“Two basic types of information needs: functional needs and hedonic needs. Utilitarian needs are those linked to the function of the product, service, or good being purchased (e.g., a lawnmower must cut tough tufts of grass well). Hedonic needs refer to the emotional and psychological needs of the various consumers (e.g., fantasies, ambitions, aspirations)”.
A segmenting, targeting, and positioning (STP) plan starts with the organizations’ overall strategy. A clear understanding and articulation of the organizations’ mission and objectives are essential to a worthy-to-follow STP. As an example, the Swedish car manufacturer Volvo’s mission is “Our solutions to global challenges are driven by our mission to drive prosperity through transport solutions” [2]. Further, an investigation into and adaptation of the plan to suit the context within which it competes is necessary.
“Understanding the environment within which the firm operates is called contextual intelligence = CiQ”.
This contextual intelligence is also called a SWOT analysis. A SWOT analysis is based on evidence about the strengths, weaknesses of the resources, capabilities, and competencies within the organization and the opportunities and threats of the political, economic, social, technological, legal, and natural environment external to the organization [3]. For example, marketers bringing out an electronic vehicle (EV) will benefit from knowing if the government will support the necessary hosts of new charging stations; what additional features consumers may expect; what consumers’ attitudes are towards environmental issues as they relate to EVs; and what pricing and promotion strategies competitors are likely to adopt these innovative cars [3].
Segmenting the market into niche groups in order to identify large and profitable market segments is imperative to new firms and new products, before many competitors select their preferred market segments. Coke No Sugar CNS (no sugar, original taste, also called ZERO in some markets) offered Coca-Cola an opportunity to market ZERO to a large new market segment, namely, health-conscious men [4]. But Coca-Cola’s mainstream competitor, Pepsi, and other smaller competitors (e.g., diet Schweppes), responded with similar no-sugar, low-calorie fizzy drinks such as Pepsi Max that may potentially turn this opportunity into a threat.
“Segmentation is a way to cut the larger population into smaller groups or categories of people with similar needs, wants, and demands. Adept marketers also consider lifestyles (value of the product to their way of life) and product usage (how compatible the product is to their way of life and other purchasing choices)”.
So another tool in the marketers’ toolkit to create awareness, interest, and desire for their product offering2 (the solution for a consumers’ problem) in order to create actions (sales, reviews, membership, etc.) is to diversify the offering to suit different market segments. Similarly, organizations will need to decide how to diversify the marketing channels to target (focus resources and efforts) each different audience (niche segment) they wish to attract and, ultimately, engage with as loyal customers (firms move customers from prospects to engaged customers and ultimately to loyal clients—the latter is also called fans or supporters). With the growth of social media (communication facilitated by online and mobile media) as an information search and communication channel for consumers, it is fast becoming an integral component of any integrated marketing communication (IMC) plan. Marketers apply the 4-E framework to think about the objectives of marketing objectives, aimed at various preselected and highly focused audiences: E1 = Excite, E2 = Educate, E3 = Experience, and E4 = Engage (Figure 1).
The 4E-framework using integrated marketing communication channels.
To excite a prospective buyer or consumer, the offer has to be relevant to them and be seen to be of some value, in other words, a worthy solution to some problem or issue they perceive (e.g., a problem could be that they want to upgrade their phone to a later model with a better camera and a longer lifetime for the battery of their mobile device). The relevancy can be improved by studying the needs of a particular target audience and personalizing the firm’s offering to suit their needs—hopefully, better than those offered by direct and indirect competitors. (Indirect competitors solve the same problem, but not necessarily with the same product. For example, Disprin can reduce headaches, as does Advil and Tylenol. But an indirect competitor might be a physiotherapy session or even acupuncture as they may also reduce the customer’s headache, but they are not chemical medicines in tablet form and dispensed over the counter.) To personalize3 offers, insights are gained using online data gathering and analysis tools such as Google Analytics, a listening system such as Radian6, or current customer information from databases such as Act or Salesforce CRM [5].
“Marketing is an exchange of value between customers and marketers. This exchange will only take place if there are trust and value between the two parties of the exchange. To personalize or customize an offer is likely to lead to better alignment of perceived and real value and therefore more sales”.
One way to engage various audiences is by positioning your offering or brand as a particular solution, so those prospective buyers will think of your brand as a solution, or particularly valuable, relative to their needs. A firm’s positioning within a target audience’s mind is how and what they think about your brand when your communication cuts through the various channels to reach them and more importantly why the marketers’ offerings are going to meet their respective needs better than other competitive offerings. For example, Volvo’s core activity is the production, distribution, and sale of trucks, busses, and construction equipment [2]. Volvo is positioned in the automotive market (buyer need: mobility) as a safe and reliable car, whereas BMW in contrast is positioned as a car for the driving enthusiast, with their well-known slogan “designed for driving pleasure” addressing these buyers’ needs [6]. According to authors Al Ries and Jack Trout [7], creating a unique new category might be profitable, especially when a strong leading brand already occupies a large section of the market for that particular offer. A good example is K-Pop bands, who are taking the music market (even in the USA and Europe) by storm. K-pop is a genre of popular music originating in South Korea, aimed at young adults. The boy band BTS is a recent global phenomenon, using a combination of heavy pop, hip-hop, and emotional appeal with a sense of authenticity plus clever multimedia marketing to promote their albums. They are the first non-USA band to appear on the US Top 200 charts for a number of weeks. Their studio has created an entirely new music segment where they can rule the air waves (and young adults’ hearts and minds). According to Vox News [8], the reason why BTS broke the culture barrier to succeed in the USA is market driven. “The answer lies in a combination of factors, and most of them are about change: the changing nature of K-pop’s studio culture and the way “idols” are produced; changing depictions of masculinity in South Korea; changing ranges of acceptable expression in K-pop; and, above all, the approach BTS has taken to building its fan base and interacting with its fans.”
A way marketers set the offering/product apart from competitors is to establish a new product category that differentiates them clearly and positions them in a new way with modified, improved benefits for certain customers. For example, marketers for a new soft drink, filled with additional vitamins and energy boosters (such as guarana, taurine, or caffeine), position the sugary soft drink as an “energy drink,” in contrast to a regular soda. (e.g., Red Bull is the leading brand in the energy drinks category, whereas Coke Cola or Pepsi may be the leading soda in the same consumer market).
Buyers differ in their needs, wants, and demands. Marketers further differentiate between buyers and segment them into smaller segments that are fairly homogeneous in terms of either needs, resources, locations, buying attitudes, or buying practices. The main purpose of segmentation activities are to ensure that potential and current customers can be reached more effectively and that communication, product, and service offerings can be matched to the unique needs of the different buyers. A market segment is defined as a group or category of customers who can be reached with a distinct and differentiated marketing mix. Marketers create segments likely to react somewhat similarly to a unique mix of the marketing and promotional tools available to the firm, namely, product, price, promotion, place, people, physical evidence, processes, and partners (influencers and stakeholders). In this section of the chapter, we will discuss four segmentation topics: segmenting consumer markets, segmenting business markets, segmenting international markets, and segmenting online market. In Section 3 we discuss the requirements for effective market segmentation plans (MSPs) and how adept marketers monitor and control segment data to ensure sustainable competitive advantages (SCA) (Figure 2).
Designing a market segmentation plan (MSP).
“The central question for any marketing plan is: WHO? Who will we serve? Who is most likely to perceive our offering as a valuable solution for a problem they might have? Who will have the money, authority, and desire to buy from our firm?”
Consumers differ in many aspects, even when they share the same need or if they are searching for a solution to the same problem. Prospective buyers differ in what they are willing to pay (and other limited resources such as time, willingness, or ability to travel to buy an item) and buying attitude (these may vary from hostile to an active, engaged fan or supporter) to buying practices (impulse buying via shopping channels, low involvement shopping via online channels, unplanned buying in retail outlets, and high involvement searches of authoritative information before active retail searches of a very specific product or service).
As market segmentation involves subdividing the market into distinct subgroups that can be served with a distinct marketing mix [9], there are many ways to segment any market, but all of the segmentation approaches start with four basic questions. (1) Who has a need or desire for our service/product/offering (need or desire)? (2) Do they have the discretionary budget or money to afford the product or service in any of the various forms (or do we have to/wish to adapt our pricing strategy to serve the target audiences?) (money)? (3) Who is the decision-maker or has the authority to approve this purchase (authority)? If we concentrate efforts on these consumers as a group, (4) do they have distinctive needs, habits, and attitudes to be able to approach and serve them as a group or segment (Distinctive)? These four questions deliver the acronym MADD. The MADD model helps marketers to divide the larger market into groups of buyers who might require separate products or marketing and communication mixes. The last D in MADD provides some way to predict how the vendor can differentiate to offer distinguishable, relevant, and superior customer value.
There is no single approach to follow, but a range of likely segmentation opportunities are sought by considering main segmentation variables, i.e., geographic, demographic, psychographic, and behavioral characteristics. For geographic segmentation, a large population of prospective consumers is divided into clusters of geographical concentration, such as nations, states, provinces, regions, cities, and suburban, even down to postal code areas or neighborhoods. For some offerings, climate and city size or population density might be key to successful categorizing of prospective buyers. When marketers use demographic segmentation approaches, they consider clusters or groups based on gender, age, life cycle stage (unmarried, married, retired) and income, education, occupation, religion, and family life cycle (no children, with children, empty nest—married but adult children) [10]. For psychographic segmentation, different groups of different socioeconomic status or lifestyle groupings such as conventional family life, a fairer deal, basic needs, visible achievement, etc. are considered. A key indicator for lifestyle in a variety of products aimed at hedonic needs or addressing status and exclusivity desires of consumers is personality. Personality traits, such as ambitiousness, openness, conscientiousness, sophistication, compulsiveness, etc., are considered during marketers’ segmentations decision. Behavioral characteristics include benefits sought (a wide range including service, quality, financing, performance); purchase occasion (regular or special occasions); usage rate (light, medium and heavy users); user status (non-user, orphan/past/lost users, first-time user, regular user); buyer readiness (unaware, aware, informed, interested, desirous, intention to buy); attitude towards the firms’ offerings (hostile; negative, indifferent, positive, enthusiastic); and loyalty (skeptic, none/indifferent, mid-level, strong, supporter/fan). Lastly, these behavioral aspects may also be linked to the online behavior of prospective customers. This may range from their likelihood to accept innovations to their online search behavior and their willingness to search for information and follow influencers or to act as influencer offering reviews and promoting the firms’ offerings to their circle of influence. We discuss online segmentation in more depth in Section 2.4 (Table 1).
Segmentation variable | Typical breakdown | Examples and comments |
---|---|---|
Benefits sought | Marketers offer a range of benefits that may address a particular need, or range of needs, for consumers. These additional benefits may include, among others, services (e.g., B&B with or without washing and ironing), quality (e.g., leather or pleather bags), financing (e.g., car purchases with lease or 48-month financing options), and performance (cars with ABS and 4-wheel drive, DOHC functions) | Qantas offers a range of flight offers for air travelers, ranging from price-sensitive travelers (who are likely to fly no-frills economy class) to full-service extra comfort business class with more personal space and the ability to sleep flat Colgate offers “whitening,” “herbal,” “sensitive,” and “fresh breath” toothpaste options to address the various benefits sought by consumers Mobile phone brand Samsung offers different screen sizes, lens quality and zooming ability, battery lifespan, and other features that relate to benefits sought, such as using the phone as a mobile office, as a camera, and in traveling long distances |
Purchase occasion | The purchase occasion links to when the idea to buy occurs or when the actual purchase will be made OR when the product will be used | Hallmark cards for special holiday such as Valentine’s day, Mothers’ Day, and Christmas or “Get well” cards. L’Oreal makeup for everyday use; special events; evening glamor; sensitive skins; refreshing after late nights or illness |
User rate | User rate refers to consumers that are either light, medium, or heavy users | In most industries, approximately 80% of the business comes from about 20% of consumers—in some cases as high as 95% comes from 15% of consumers. So, it is important to provide the products and services those clients buy. E.g., if an ice cream store (e.g., Wendy’s) runs out of chocolate or vanilla flavor, they will quickly react by refilling these flavors, while, should a flavor like pistachio or rum run out, consumers are likely to simply purchase another favorite. In contrast, should a consumer want a chocolate ice cream, they may purchase from the store’s closest competitor rather than select the next best option in the store |
User status | Firms record user status on their CRM or customer databases to determine which type of marketing tactics they should employ to increase their share of wallet (% of business from this customer) and market share. Status varies from nonusers to potential, first-time, and regular users. Past, lapsed, or ex-users (also called orphans within the firm) are customers who may have bought from the firm but no longer do so | The marketing strategy of start-ups may be to attract new users and retain them as regular users, while well-established businesses are likely to pursue recurring business from existing customers, re-interest lapsed customers, and poach clients from competitors Many firms spend a large portion of their marketing budget and resources on retaining, cross-selling, and up-selling existing customers. This is a cost-effective strategy, since past purchasers have indicated their interest in and desire for the firm’s offerings. Adept marketers also try to regain interest from lapsed or past users or determine why they have left, to see if the firm can improve their retention rate and keep current and future customers satisfied |
Buyer readiness | Consumers are at various stages of readiness: unaware of the firm’s offering; aware; informed, interested, desirous; or already have the intention to buy—thus fully ready | When a new product is launched into the marketplace, for example, an electric vehicle (EV), say Range Rover’s first priority is to raise awareness and educate consumers and potential buyers. In contrast, potential buyers may be very aware and highly informed of solar energy panels, but the uptake and purchase levels are low. Thus, entirely different marketing objectives and tactics are required to communicate with these various buyer-readiness segments |
Loyalty status | The degree of loyalty to a brand and their offerings may vary substantially from a brand skeptic (negative feelings), to neutral, indifferent, or no-loyalty, to somewhat loyal (mid-level loyalty status), to the ideal brand loyalty status of fan/supporter/zealot | Consumers can be loyal to products (Google Maps) or brands (Coca-Cola and Apple) or a store (Gap NY), a sales person (Ray White estate agent), or a company (General Life Insurance). Loyalty patterns inform marketers about what appeals to a particular market segment, and by studying less-loyal customers, marketers can learn about competitive offers and how to adapt (or die). Marketers need to take great care when studying loyalty, since various contextual and personal factors such as convenience, price sensitivity, and product availability might impact loyalty |
Attitude towards the firm’s offerings | Consumers can be placed on a continuum of attitudes towards the firm’s offerings, ranging from hostile, negative, and indifferent to positive and enthusiastic | Positive word-of-mouth (WOM) and electronic WOM (eWOM) are very valuable to marketers to build the brand reputation and perception of trust and value in prospective buyers. Many companies monitor the social media comments, rating, and reviews to determine the attitude towards the brand and its offerings. For example, FlightStar (a travel agency) may adapt its tours to exclude a particular hotel or destination if many consumers give bad reviews or leave negative comments on Twitter or Facebook about these particular hospitality providers |
Online behavior | Online behavior ranges from the likelihood to accept innovations to online search behavior; willingness to search for information (level of involvement); to willingness to follow influencers and offer reviews; willingness to promote the firms’ offerings to their personal circle of influence (called advocacy) | Marketers track individual’s buying behavior, including payment methods, click-throughs, minutes spent on a page, and influencers followed, to improve search results and the likelihood to stumble upon and/or reach the firm’s online advertisements or website. For example, a consumer opening a picture of a particular pair of jeans on Pinterest may be directed to Levi’s (jeans) website or a similar denim jacket on Levi’s site. A web-surfer looking at scenic pictures of a particular destination, say Italy, may be directed to travel products (e.g., MSC Cruises to Italy). But they might even be sent travel advertising at other times, when they are on sites unrelated to travel. |
Behavioral segmentation approaches for consumer markets.
It is most often necessary to use multiple geographic and demographic segmentation variables in combination with each other to ensure access, differentiation, and a useful model to predict behavioral responses to the firms’ marketing communication and marketing efforts. To ensure precise and viable categories with fairly homogeneous needs and access channels, marketers use multivariate segmentation. For example OurDeal, a direct competitor of the well-established Groupon, that offers discount deals to the mass market, via Channel Ten TV, carefully uses both geographic and several demographic variables to focus their offers [11, 12]. OurDeal CEO and founder Julian Holman says: “TEN is the undisputed leader in the under-50s market and this means OurDeal merchants can extend the reach of the existing OurDeal online and social media outreach activity through the power of mass marketing television and online advertising.”
The ultimate aim of targeted marketing is highly customized offers and highly personalized marketing communication. Adept marketers suggest that personalized interactions nurture loyalty, greater engagement, and thus better return on marketing investments [13]. One-on-one (also written as 1:1 marketing) relies on understanding the unique preferences, behavior, and decisions of individual consumers and then adapting the marketing offers of the firm to ensure preference or choice in favor of the marketers’ brand or offering. The personal tastes and preferences rely on very accurate knowledge of the consumer, to the point where the product and service are so highly adapted to the individual’s need, that he/she feels treated like the marketers’ only customer (hence 1:1). In today’s highly automated and digital environment, most of this information about habits and behavior, personal choices, and interests are collected during the various interactions with the firm. For example, online searches and clickthroughs are recorded on Google Analytics; personal interactions with salespeople are recorded on CRM databases; purchasing and payment habits are recorded via electronic funds transfer (EFT) systems. The firm learns the preferences and customizes a marketing plan for them. Ideally each interaction will be highly customized to suit each customer, but this highly unique customized marketing mix may be rather costly, and thus the firm will have to maximize benefit (to both parties) and minimize cost. So, after a 1:1 marketing strategy, the next best and most viable option is to create segments of customers with very similar needs, habits, decision and choice patterns, access points, and lifestyle choices. Access to consumers’ eyes, ears, and hearts is at the crux of good marketing strategies. Which channels can marketers use to communicate with their most likely prospective buyers? What should the message say to convince them to trust the brand? What should the message be to persuade them of the value of our offer? How should the firm best approach prospective customers to ensure their action and loyalty? These are the questions marketers have to ask to consider creating fairly homogeneous groups of prospects, customers, and loyal supporters.
Companies who continually listen to customers, improve their offerings, and stay competitive and relevant are likely to succeed in the hyper-competitive marketplace. The CEO of General Electric (GE), Jack Welch, once said: “we have only two sources of competitive advantage: the ability to learn more about our customers faster than the competition and the ability to turn that learning into action faster than the competition” [14].
Business-to-business marketing or B2B marketing is the marketing of products and services to a variety of organizations such as companies, government bodies, nongovernmental organizations (NGOs), and not-for-profit (NFP) businesses (such as schools, hospitals, libraries) and other firms. These may vary from small, single-person entrepreneurial firms, to family-operated local companies, retail chains, and franchisors, to large global conglomerates with various purchasing agents and complex decision-making procedures. In B2B marketing, buyers use the products and services they purchase, either to produce their own products and service offering, or use them in their daily operations, or use them to sell to other B2B customers. A university buys copiers, computers, mobile phones, books, desks, filing cabinets, and carpet, among other products, for their daily operations, while a research laboratory may buy chemicals, gas for burners, benches, white coats, copiers, mobile phones, and computers. A car manufacturer like BMW purchases pre-made seats and carpeting and some instruments like car radios and electronic dashboards to ensure a high quality interior that is both pleasing and functional [15] and compatible with drivers’ current habits. As an example, the new BMW i3 includes Apple CarPlay in their dashboard to allow drivers’ smartphones to interface with their vehicles, thus meeting current technology habits and needs of BMW drivers. As another example, we specifically chose mobile phones to appear in two of the aforementioned lists, since it could be argued that all B2B products are also consumer products, since they are bought to be used by consumers with specific needs and purposes for these products. When one of the employees of the university or research lab buys a mobile phone for personal use, it is classified as a consumer product. But, even for an identical phone, the product is considered a B2B product (phone), when an employee uses it for work purposes. Buying motives for a business customer, though, is likely to differ from that of the individual end-user (consumer). For example, a consultant using his/her phone as a mobile office is likely to have different needs such as large memory, long battery life, and various pre-loaded office management software. In contrast a private individual consumer may be more interested in the quality of the camera and the media speakers than those criteria listed by business customers.
Organizational buying behavior is a complex combination of individual decisions and organizational buying processes and procedures. Although the final purchasing budget may belong to the organization, individuals may be procurement officers, users, and people with the power to veto a decision. A key characteristic of B2B buying behavior is that several individuals from different backgrounds, with different buying motive and different levels of decision-making power, may be involved in the buying decision. For example, the purchasing process for the research laboratory to buy new laboratory equipment may involve the lab technicians (functional needs), the maintenance staff (for cleaning), accounting (for budgeting and price setting), a legal advisor (for servicing contracts), and a business unit manager (opportunities to optimize resources and competitive advantages). This group is called the decision-making unit (DMU). Therefore, B2B marketing is mainly about relationships of trust and transactions between organizations as represented by individuals within the two trading organizations. As said earlier, marketing is about creating or adding value for consumers. Similarly, B2B marketing is helping business customers to be successful by delivering superior value to enable the DMU to produce their own valued products and services for their internal and external customers. Thus, just like in consumer marketing, the success of B2B marketing depends largely on marketers’ understanding of what DMUs value and ideally understanding what each individual role player in the DMU values and the style and channel each member of the DMU prefers.
Marketers who sell to large international companies, or conglomerates with several divisions, business units (BUs), or plants, may subdivide the large customer as a set of sub-segments. In this case, the different SBUs with different needs and different buying behavior can be clumped together as segments, allowing each BU to be targeted using different marketing and promotional mixes and different communication channels and targeted messages. For this type of segmentation, large BUs are likely to receive highly personalized attention by key account managers to serve their unique needs, while regional offices and medium-sized BUs may be served by using regional sales teams. The small (or micro) accounts can be served via online order-taking systems or telemarking sales-and-support officers. An example of this is travel agents like ORBIT Travel. Their large corporate clients each have a dedicated key account manager (KAM) at their regional travel agencies, while smaller firms will deal with a team of specialists serving a particular niche (e.g., one B2B sales professional serve banking clients, while another may serve education institutions). Small business owners are treated in the same way as individual consumers, by asking them to either book online or visit the branch to make their bookings via any one of the available travel agents on site at the time of their booking.
B2B marketers combine use mainly three common approaches to segment business markets: the two-stage approach; the three-dimension approach; and the nested approach. We discuss them here:
This approach, designed by Wind and Cardozo [16], combines customer firm characteristics such as size, industry, and product application with the nature of the decision-making processes of the BU. The first macro-segmentation step is to group firm of similar size, location, and industry together. For example, B2B marketers might group large corporate accounts, SMEs, and small customers into three separate clusters. A promotional signage company may, for example, segment their corporate clients into segments such as packaging, signage and displays, outdoor, vehicles, and trade shows OR by industry, e.g., healthcare, construction, beverages, printing, automotive, and fashion apparel. To ensure a competitive advantage, the next stage is to find clusters within the macro-segments that demonstrate similar buying behavior (micro-segments) or similar decision procedures by the DMUs. For example, within the cluster of healthcare professionals, large B2B customers have purchasing agents (BUs) that buy on behalf of five to ten franchisees, whereas pharmacists who manage their own small pharmacies act as their own marketing specialist and purchasing agent for their pharmacies. Where the large franchises use expensive point-of-purchase displays and window-dressing to communicate season offers such as cold remedies, the smaller pharmacies only use branded items offered for free by large pharmaceutical suppliers. Although this second sub-division of macro-segments into micro-segments offers insight into individual decision-making processes, this second stage is difficult (due to access to this type of information) and costly to collect (due to a long time it takes to learn about different practices and decision-making procedures).
The three dimensions to consider when executing the three-dimensions segmentation plan are customer groups (who), customer functions (what), and technologies (how) [17]. The customer groups dimension refers to the standard consumer/customer-based segmentation using demographics, geographic categories (e.g., province, state, nation, postal codes, suburbs), nature of the customer (e.g., academic, professional, sales organization, law firm, government, etc.), or product usage characteristics (DMU, first-time client, loyal customer, buying situation). Customer functions are related to the application or solution sought, e.g., for the travel industry, it might range from conference attendance, site inspection, convention, movie premiers and PR events, honeymoon, family holiday, sales award functions, etc. For the third dimension, the marketer considers how the product or service may be communicated, applied, best used, enhanced or distributed, and supported. For example, a book publisher might deliver hardcover printed books, or paperback, e-books, or part downloads. Returning to our travel example, prospective buyers may be divided into walk-in clients, call-in clients, online leads, outbound calls, corporate deals via key account managers (personal selling), and trade show sales (Figure 3).
Three-dimension approach to B2B segmentation
In the B2B environment, Bonoma and Shapiro [18] suggest that marketers use a “nested approach” to segmentation. This approach consists of five segmentation categories with increasingly more detailed information about the buyer organization’s buying behavior, set out below. It is important to note that the required information needs to be meticulously gathered to be as accurate as possible and therefore is often costly in time and resources. The more detailed, the costlier to gather. The information contained in each of the levels set out below gets more difficult to get accurate and thus more costly as you go down the list:
Demographics: industry, size, location, international spread—this information is easily obtained from various databases and other secondary (public or purchased) data sources.
Process characteristics: buyers’ operations such as technology employed, type of product application (e.g., how they will apply/adapt the marketers’ product or service)—this information is more difficult to come by but can often be found in annual reports and websites, through the sales representatives and via various forms of primary and secondary research.
Purchasing approach: buyers’ specific processes and structures within the firm, as well as their procurement procedures and purchasing policies, should be determined through research but also personal relationship building experiences with potential and current clients.
Situational factors: a whole host of situational factors, including the size and urgency of the order(s), whether the order is a regular recurring order or an unusual ad hoc order or perhaps an entirely new client. Further considerations are, among others, the number of users and their experience with the product, the sales professional and support staff, and the trading firm.
Personal characteristics: motivation, risk profile, and relationship.
Although Bonoma and Shapiro suggest using all five levels in the nested approach, the authors advise firms to balance cost and rigor. But using all five levels ensures a systematic and hierarchical approach that will prevent marketers from missing relevant indicators to ensure distinctive, viable, and measurable market segments (Figure 4).
Nested approach to B2B segmentation (adopted from [18]).
Exchanging products between countries, as a form of international marketing, has existed since the earliest recorded histories of mankind. A key factor affecting the need for international bartering and economic exchange is the uneven distribution of and access to natural resources across the globe [19]. For example, by far the largest producers of useable iron are Australia, Brazil, and China, who severally produce more than 75% of the world’s useable iron ore [20]; India is the largest producer of mangos [21], and ± 70% of all wool exports come from Australia and New Zealand [22], and India is the top cotton producer in the world [23]. Technological advancements (including innovation in transport, information technology (IT), and business processes) have contributed to international trade and economic cooperation. Certain countries and some companies develop competitive advantages due to new efficiencies, new more cost-effective processes improved capabilities, or economies of scale and scope, thereby making their inventions or services (e.g., cheaper labor for telemarketing services) preferred. In some cases, beneficial trade agreements and political alliances result in increased trade between particular countries. With continuous, radical, and often disruptive improvements in data and telecommunications technology, opportunities for marketing communication, sales, and transferring data (money and information) continue to improve in quality and increase in quantity.
International markets concern attracting and servicing customers abroad—away from either the manufacturing or the main location of the organization’s head office (HQ). International marketing can be binational (only one country away from local markets) or multinational (more than one country the firm may market to, away from HQ or manufacturing plants). For example, a multinational company like Coca-Cola sells in more than 200 countries, with the “Coca-Cola logo is recognized by 94% of the world’s population” [24], while the global electronic company Samsung operates in 73 countries, with 39 production sites, 35 R&D offices, and 7 design sites worldwide [25]. Operating in such a diverse set of nations obviously adds a whole host of complications. In addition, the mode of operation in various countries may take several forms, from servicing markets directly in foreign markets or indirectly through franchises, licensors, distributors, agents, or brokers or remotely via online providers and a host of supply chain members (including raw products, distribution—the case of Coca-Cola bottling plants; for Samsung assembly plants in partnership with FedEx, DHL and other express couriers to deliver online purchases).
To reduce complication and optimize available resources, firms segment their international markets into target markets with distinct buying needs; differential benefits sought; and/or unique behaviors. There are six main international segmentation approaches that this chapter discusses: geographic/location; economic factors; political/legal factors; cultural factors; cross-market segmentation; and micro-marketing.
The most logical or obvious segmentation variable seems to be to divide the global marketplace into geographic segments, either by region (e.g., Africa, Western Europe, Australasia, North America, Latin America, etc.) or by country (e.g., China, Canada, Nigeria, Peru, etc.). Although this seems a fairly logical segmentation model, it is somewhat flawed, as the main principle for segmentation is to ensure homogeneous needs (from the consumers’ perspective), access, and buying habits. Some value lies in location segmentation. Three factors that are likely to ease trade and exchange in these large regions are (i) the monetary denominations (e.g., Euros in Europe and US$ in North America), (ii) trade agreements (e.g., the North America Free Trade Agreement and the European Free Trade Association), and (iii) reduced trade barriers (European Union). In many ways though, the assumption of homogeny is flawed, as these groupings by location/nation often share minimal common traits or behaviors. For example, business executives in Sydney have little in common with the rural sheep stations in Homerton Victoria, the tour operators on the Barrier Reef, or the iron ore miners on the west coast of Australia. However, regional segmentation is often used as a first, categorical segmentation in order to find a hierarchical structure that will allow for some economies of scale in traveling, distribution, and human resource allocation. For example, Samsung boasts 15 regional offices and 7 design sites, while Coca-Cola reports 5 main operating regions, namely, Asia Pacific, Europe, Middle East and Africa, Latin America, and North America.
Global markets for multinational firms may segment markets on the basis of economic factors. For this approach, income levels or economic well-being and the overall level of economic development of the country and the potential consumers are considered. Segments may, for example, include “developing countries” as a segment, which may be India, Chile, Fiji, Angola, and Argentina [26], whereas the USA, Britain, France, Germany, and Japan (members of the G7) are considered developed or highly industrialized economies.
A slightly less macro-level approach is to consider the local political and legal factors that are likely to influence the willingness to do business with foreign firms, the number of regulations, and bureaucracy. Of serious consideration for the long-term well-being of the firm and its entire supply chain is the political stability of the government. Civil war or the threat of cross-border attacks not only affects consumer confidence but also affects various contracted suppliers up and down the supply chain. Political unrest is likely to impact exchange rates but may even reach [27] as far as impacting the message content and channel firms used to educate and communicate with consumers. A good example of the impact of political unrest or crises on sales is in the area of international tourism [28, 29]. Cultural factors such as language, religion, norms, customs, values, rites, and other behavioral patterns are considered by some marketers to group consumers into segments. A wedding event planner may consider offering a diverse range of events to satisfy her Jewish customers, a segment of Christian brides, and perhaps consumers who have no interest in a religious ceremony but merely wants a family gathering or a party with friends. In contrast proofreaders may decide to segment their prospects (to attract new market segments) as those students who are not first language English-speakers but who may be studying at an English-teaching university. For example, the Universities in Australia attract a large number of Chinese students, who may require proofreading services for their postgraduate theses. A Sydney-based proofreading service WriteWell may offer students a valuable service of translation and/or proofreading, specifically focused on ESOL Chinese students studying at Australian universities [30]. The final approach in this discussion of international market segmentation planning (MSP) is cross-market segmentation. In this approach—even if these consumers are situated in different countries̶—the main criteria marketers used to collect consumers into segments are consumer needs and buying behavior. For example, the eyewear company Ray-Ban positions themselves as “Timeless style, authenticity and freedom of expression are the core values of Ray-Ban, a leader in sun and prescription eyewear for generations” [31]. Ray-Banis now available in 213 countries, but despite the geographic spread, the main segment the markets by self-image and self-expression groupings, using music festivals and various sport celebrities to influence future buyers [32].
Local marketing (a form of micro-marketing) entails dividing the large global market into concentrated groupings, most likely by cities, by neighborhoods, and in some cases even down to specific stores within a neighborhood. Global brand SPAR (food retail, groceries, fresh produce, and in some cases small delis, pharmacies, fresh flower sales units, and jewelry counters) adapts both the width and the depth4 of their product offerings to each local area. For example, the SPAR in Morano (previously DeSpar), Italy, sells a huge variety of Italian cheeses and local wines like Prosecco, whereas the SPAR in the small rural town of Moorreesburg, South Africa, sells various spiced biltong (a favorite dried meat snack) flavors and a huge variety of barbeque accessories. A major advantage is an agility and responsiveness of the smaller localized stores (business units of the group) to contextual events and market forces specific to that area. Marketing mixes and marketing communication can be customized to suit the norms, habits, values, and language needs of the local market segment. Specific niche media may be available on a local level that is not available on a national or global scale (e.g., a local newspaper or niche magazine like the North Shore Times may only serve a small sector of a state or region). This local or micro-marketing approach is much closer to the idealized segmentation model of 1:1 marketing but has some important drawbacks for marketers to consider. Foremost, the consistency and reputation of the brand (and its unique value proposition, see later) need to be respected and are often difficult to maintain, given the varied and fragmented markets. Secondly, the widely spread and small nature of the markets pose a big threat to the sought-after economies of scale and add to various sourcing and distribution costs (e.g., delivering highly customized, uniquely adapted products to two different countries, many miles apart). Fortunately, online media and technology has simplified communicating with and targeting highly dispersed (or tightly localized) market segments.
It is quite natural to think that online consumer segments must be the same as other consumer segments. They are simply put as people searching for solutions̶ products and service that can meet their needs and add value to their lives, aren’t they? In a way this is true, but since the Internet offers so many alternative sources of product and service information, scholars [33] suggest that a different approach to categorizing online buyers is required. In addition, prospective customer activities, online behavior, and habits differ substantially from traditional retail behavior. Consumers are better informed, are more mobile and traveled, and have more choice due to technological advancements. Forbes [34] reported that social media usage would see the largest growth (31%) in marketing expenditure of all available brand communication media. Therefore, marketers use a different set of criteria to categorize online segments, aiming for these customized approaches to deliver more relevant communications and more valued offers. Luckily these technological advancements also enable online marketing, making it is easier than ever to tailor marketing messages to different demographics and consumer categories. Artificial intelligence (AI) and machine learning algorithms (MLA) and tools to analyze big data about consumers with some immediacy (CRM dashboards) make it possible for marketers to now predict website visitors’ likes of products and brands based on similar users’ behavior [35]. Current models divide online consumers into three basic categories: non-purchaser, purchaser, and potential purchaser segments [36]. In this chapter we will also differentiate between segments by considering information search habits, propensity to shop online, shopping behavior, and site attributes sought by prospective buyers and current users. Several typologies exist, and new ones are constantly added, due to the fast-changing nature of web developments but also because shoppers get more experienced using the web and online services, and therefore also adapt their habits and behavioral patterns.
Online information technology (the Internet) provides consumers with the ability and tools to share product and brand information online. In 1995, Amazon already offered customers the options to post comments and reviews online [37]. In more recent years, it has become a fairly common phenomenon for companies to seek ratings and after-sales feedback via web-pages—asking only a few seconds from customers to complete firm-generated rating scales or add self-generated review comments [38]. Research evidences indicate that consumer reviews have become important sources of information and guidance for prospective buyers’ purchasing decisions and affect brand reputations and product quality perceptions dramatically [37]. But, it is not all good news! Disgruntled consumers are quick to post bad reviews and scathing comments either on the company’s website [39, 40, 41] or review sites like TripAdvisor, Manta, Angie’s List, or Foursquare [40]. Social media offers an outlet for customers to express disappointment, stories about poor service, and claims about unethical actions by firms, arrange boycotts, and spread bad electronic word-of-mouth (eWOM) on various online platforms—all likely to be harmful to the brand. These comments are read, with more than 80% of prospective buyers indicating that they read reviews to determine the quality of a local business [39]. These reviews and social posts shape a firm’s online reputation outside of the planned marketing communications of the firm. Upset consumers go as far as starting anti-brand communities (e.g., Anti-Apple; anti-Wal-Mart [42]) to express their disdain and dissatisfaction with a product or brand or even a social movement to place hurdles in the path of brand growth. User-generated discontent (UGD) and negative ads for products can be easily found on YouTube—some simply making fun of a brand (e.g., Dove [43, 44, 45]), others more negative in its comment on the value or acceptability of the brand’s practices.
In some cases it is a good marketing strategy to “license third parties” to comment and, in so doing, ensure a sufficient level of review informativeness [37]. Further, proactive marketers create opportunities for consumers and current customers to engage at various levels with the brand and its various products. Marketers consider higher levels of engagement the desired outcome, because customized IMC should result in better engagement, response rates, and thus increased purchase and loyalty levels. The ideal outcome for a firm is to move consumers up the ladder of engagement (in figure ABC) to co-create products, thus creating their own demand. Companies use various systems of communication, registration, processing, feedback, and rewards to ensure customer action.
At the first level of engagement, firms merely have a like/dislike button to allow users feedback by clicking the relevant icon. At the next level, online firms like Amazon ask for customer ratings (providing a sliding scale or point system). Customer reviews are fairly common to the travel and hospitality industry, with consumers leaving long or short, often highly detailed reviews of hotels, restaurants, and Airbnb home rentals [46]. Discussions, as the first level of co-creation, are a two-way communication between the brand and its consumers. Home Depot, as example of this fourth level of engagement of discussion and idea-sharing, allows consumers to answer questions regarding DIY projects posed by other consumers, on their website [47, 48]. At the next level, customers co-create advertisements with the branding team at a firm. In Greece, Kraft Foods published several long-form user-generated advertisements for Lacta chocolate [49]. The sixth level of consumer engagement for online products and brands is co-created brand naming. In 2008, Boeing renamed the 7E7 airplane to Dreamliner, responding to consumers’ choice, as recorded on
Social media consultants [54] of Marsello suggest segmenting online users by actual, measured levels of participation, which is also some indication of their common interests and online surfing and activity habits. When measuring actual engagement and true online media usage, seven segments emerge: segments based on (i) recency, frequency, and money spent (RFM) and customers’ engagement into (ii) six sectors, namely, curators (keeping and reposting content), producers (authentic content created by consumers UGC), commentators (consumers’ comment on firm content, products, or activities), sharers (consumers sharing advise or experiences), watchers (observing trends and fads and adding to the dispersion or adoption of new products or improvements), and, finally, advocates/detractors (fans and supporters, sharing reviews, links, or eWOM via Facebook, LinkedIn groups, and Google + Circles) [55].
There are several specific approaches to break the entire market into smaller, reasonably homogeneous groups, but e-commerce personalization depends on the data sources marketers can access and personalize against. These segments are decided, based on usage (channel engagement; web search habits, time spent, purchasing behavior) and where trust resides (influencers followed, time habits, likes and dislikes). Figure 5 displays 16 possible segmentation criteria used in e-commerce (Figure 6).
The ladder of collaborative co-creation for online engagement.
16 online segmentation/personalization criteria (adapted from smart insights [55]).
Marketers have the ability to share information with a vast range of audiences and potential customers, using blogs, photographs (Instagram, Flickr, and Pinterest), videos (YouTube, own site, directed communication), personalized direct e-mail campaigns, and corporate website content. Social media widens the range and reach of firms’ communication mixes and a range of channels and formats. Various goals can be addressed in various ways (but consistency in value, look-and-feel; thus IMC is essential to build recall, recognition, and brand reputation). For example, Pinterest can be used to inform and excite (gain interest), whereas YouTube can be used to entertain, educate, or add multimedia (sight, sound, subtitles, etc.). A highly valued feature of social media is the ability to bookmark sites [56].
Bookmarking facilities on social sites allow visitors to post the firms’ messages to their own Facebook pages, link them to their LinkedIn profiles, or share links with their own networks of colleagues, associates, and friends. This e-word of mouth (eWOM or word-of-mouth) is very valuable to marketers, as these shared links add credibility and trust to the message and widen the reach and impact of the firm’s marketing communication [56]. Twitter, with its 140-character limit, is hugely popular to the blogging online community, with 336 million (66 m in USA and 40 m in Japan) monthly active users (MAU) and 500 million tweets per day. Firms listen to the Twitter chatter about brands to see which key phrases are associated with their brand and product offerings. According to Reuters Press [57], Dell computer company, Twitter played an important role in selling millions of dollars’ worth of online products (Figure 7).
Media matrix of McKinsey (2000) online shopper typology.
Departing from the original study by McKinsey (2000) reported by Hamilton [58], Kau et al. [59] studied 3172 shoppers to review and expand the typology developed by McKinsey, to link demographics to behavior indicators and find a more sophisticated matrix to combine on- and offline shopping behavior. This is important for marketers, as demographics are normally easy to source and identify for targeted communications and segmented marketing mixes, whereas behavioral characteristics are more difficult to investigate [59] (Figure 8).
Kau-Tang-Ghose (KTG) clusters of online surfers and shoppers.
The KTG typology is useful to marketers, since each group has different demographic and psychographic characteristics. The clusters also display different (homogeneous within clusters, but different between clusters) online and offline purchasing behavior. A SMP based on these segments will assist marketers in devising promotional and communication plans to suit specific segments of shoppers. Marketers can build on the fundamentals of direct, personalized marketing applied offline and combine it with the capabilities of machine learning to deliver the nearest thing to 1:1 marketing. According to KTG [59], “the access to information, the ability to easily compare, the convenience of not having to go down to the mall and the use of familiar brands–drive e-commerce” (p. 156). E-Shoppers value various online service aspects, ranging from the quality of information, the ease of placing orders and returning goods, to pricing, security of personal information, and vendor’s reliability in getting the order to the buyer in a timely manner (Figure 6 for the full range of 11 sought-after attributes) [60] (Figure 9).
Fantail of attributes sought by e-shoppers (adapted from [60]).
Selecting the right cluster of online shoppers (segments) for the firm’s offers is thus of great importance, not only to determine the clusters’ unique communication needs but also to understand what motivates particular clusters of Internet users and focus the firm’s efforts on those attributes most valued by the firm’s target audience(s).
Whichever approach marketers use to segment the market (or choose to eliminate suspects to find possible prospects to qualify, inform, and ultimately engage), viability, and usefulness needs to be determined. The two most important strategic marketing decisions a business will make are choosing the most rewarding market segments and determining how to position its offers. Selecting rewarding (in terms of various objectives including maximizing profitability, maximizing market share, entering a new strategic market, building brand reputation, etc.) segmentation is the first of a three-step strategic process. The next stages are selecting the targets for the firm’s marketing efforts; positioning the firm’s offer or brand in the most attractive way to attract and engage the preferred segments; and, finally, allocating marketing resources to pursue prospective groups of customers [61]. In the past, scholars suggested these stages are consecutive, linear stages, but today scholars concur that segmentation is an ongoing, iterative process that needs to be regularly (even continuously) re-examined and reconsidered. Business market segments are highly dynamic due to the quick response of marketplace competitors to demands from customers, new technological and other radical innovations, as well as economic up-and-down turns. Sophisticated marketers will even attempt to anticipate and predict contextual instabilities to prevent having to play “catch-up” to more astute competitors [62, 63]. It is marketing, sales, and new business managers’ responsibility to continually reassess the original bases for current segments and to remain vigilant about the personal, situational, and contextual factors that might impact their current and future customers (Figure 10).
The relationship between segmenting, targeting, positioning, and niche marketing (adapted from [3]).
Most organizations have moved away from mass (undifferentiated) marketing to targeted (differentiated/segmented) marketing: identifying and dividing the likely buyers into somewhat homogeneous segments to serve and then selecting a few to focus the firm’s limited resources on. Even the wealthiest firms cannot afford to serve all customers and prospects equally. For the undifferentiated marketing strategy, marketers focus on common needs, shared by consumers in the mass market, rather than the differentiated needs, shared by similar consumers. The communication strategy is aimed at messages that appeal to as large a group as possible. Communication and marketing tactics are directed at the whole market rather than a particular niche audience. This strategy is not one most marketers would pursue, despite the economies of scale due to lower production and distribution costs, because, despite minimal cost spent on research and niche messages for niche audiences, most marketers fear that discerning customers who are spoilt for choice may not respond well to generalized marketing messages. Marketers fear that less satisfaction is likely when offers are not customized. A concern with a large number of direct and indirect competitors in such an undiversified marketplace results in firms focusing efforts on a select few, well-differentiated market offerings. General Motors offered “a car for every purse and purpose.” A buyer might start with a Chevrolet and gradually trade up to a more exclusive Buick or Cadillac [64]. Today Toyota tries to emulate this strategy with a car for every purpose and personality, with the Rav4 aimed at the more outdoorsy, adventurous types, the Camry for the more conservative, money-conscious family buyers, and the Toyota Lexus for the elite luxury seekers. The third type of targeting strategy is a concentrated marketing strategy. This is always called niche marketing or a niche market strategy. When firms have very limited resources, a niche strategy is one where a firm focuses on gaining a large market share of a small sub-segment (as opposed to a small share of a large market segment). The main benefit of niche market segmentation is that the firm is likely to have fewer direct competitors in the chosen niche segment. With the niche media and direct channels offered by social media and the World Wide Web, it is today easier than ever to focus efforts and resources on a small niche group. For example, on TradeMe, consumers can buy and sell good-as-new used goods to private buyers. Small online traders can focus on a high niche sub-segment. For example, small galleries may focus on handcrafted pottery or sell their uniquely crafted, handmade items via Etsy. Etsy was launched in 2005 in Brooklyn, USA. Today Etsy has more than 60 million items and more than 40 million users—connecting 2.1 million sellers with 39.4 million buyers for a gross merchandise sales (GMS) of approximately $US 4 billion [65, 64].
“For a differentiated MSP, the firm targets a selection of market segments, and designs separate uniquely differentiated offers for each target audience”.
There are four main steps to market targeting:
Dividing the market into buyers who might have different needs, requiring separate marketing (product, price, promotions, distributions) and communication (channels, niche media, targeted messages, content, and stories) mixes, which we have discussed above.
Selecting a segment (two or three) to target, which is attractive and viable.
After that the firm designs a unique value proposition (UVP or USP = unique sales proposition) to differentiate itself from competitor offerings.
The final step in the MSP is to integrate all communication and promotional efforts to offer a clear, distinctive, and desirable place in the mind of its potential target audience(s).
Selecting the firm’s targeting strategy is based on a series of five important factors. First, the firm’s resources (or lack thereof) are likely to play an important role in this decision. With limited resources, highly concentrated or niche segments are likely to be the more viable market-targeting strategy. Second, the particular product and the firm’s ability to differentiate the product/service offering will also impact the segmentation strategy (Figure 11). Third, the product life cycle (PLC) stage needs to be considered during the decision-making process (Figure 5).
The product life cycle (PLC) in three stages (adapted from [66, 67]).
A sound choice will concentrate efforts for new products, launching one or two versions of the product initially or perhaps launching only one product type to an undifferentiated market. When the product achieves higher levels of awareness, adoption, and growth, the firm might select a more differentiated targeting strategy. In the next section, this chapter considers the tests for effective segmentation.
Developing market segments and assessing their viability rely on detailed analysis of marketing research, sales data, customer and buyer information, and contextual and competitive information. Some firms though focus on segmentation purely by product type or product size (e.g., this would be similar to Coca-Cola deciding to segment the market by those who purchase 330 ml cans and those who purchase 2 L bottles). In contrast another segmentation error is seeing the entire industry as one segment. For example, a firm making sails for boats might see themselves as selling “sailboat sails,” missing out on a whole section of potential customers like umbrellas, tents, or other outdoor equipment and protection. This is termed marketing macropia [68]. An overly broad view of an industry could be linked closely to firms’ inability to identify a range of core needs for which the firm’s offers are solutions. For example, a service like hair dressing does not merely sell “haircuts” or serve only to solve untidiness or unruly hair problems. Hair styling artists of Se Salon may serve customers’ need to look more fashionable (contemporary styling), or look a bit younger (age-appropriate but modern styling), or fit in with regulations (police and service people styles) or merely to be pampered (an hour away from obligations and responsibilities while being pampered—including a scalp massage). Seeing themselves as “personal grooming professionals,” Se Salon might even extend their market segments to include beard grooming, shaving, eyebrow shaping, and other related services.
“Marketing myopia is an approach to marketing that fails to define the firm’s products in terms of the customers’ needs and wants. It results in the failure to see and adjust to the rapid changes in their markets” [69].
It is therefore important for marketers to assess (and reassess as we will discuss later) the effectiveness of their segmentation analysis and answer the question: “Which market segment will we serve?” By considering all likely segments and selecting viable segments based on five main criteria that are substantial (large enough to make the firms’ efforts and investment of resources worthwhile as they relate to our marketing objectives); differentiable (can the firm create offers and a marketing mix that is of value to the segment, and the segments are homogeneous within and heterogeneous between segments); measurable (reliable information about the segments need to be obtained via primary or secondary sources); accessible (are there available and uniquely targeted channels to reach them), and fairly stable (the market must not decline, reduce or fluctuate unpredictably). The segment size and growth (or not) are a relative issue. Firms would obviously prefer segments that are large in current sales and likely to produce high volume and size in future transactions, with a high profit margin. Unfortunately, some fast-growing segments might not always be the most attractive ones, as they may be high in restructuring or re-engineering costs. The firm might not have the right equipment and/or talent to serve the target market. It might be in the interest of the firm to select segments that are smaller at the outset and somewhat less attractive for current transaction size but are potentially more profitable.
“Segments can be labeled as “large” based on current transaction size, potential purchases, or even their ability to generate leads for the firms’ clients—with their own clients as referees and referrers”.
A good example is HSBC Bank who might offer savings accounts and fee-less ATM cards for young teenagers, in the hope to retain their business well into their high earning years, where profit will be gained from these future employees’ salary income, credit cards, house bonds, education policies, insurance, and other interest-bearing and fee-bearing transactions. Some segments might even be chosen purely on their ability to refer business, so the indirect income from reciprocal business is important to the firm. An example to illustrate this principle is a lawyer Smith & Samson, who might do legal work for an estate agent, says Pam Golding, not because the estate agent industry is particularly lucrative or a key account but because the estate agents at Pam Golding have large housing developers, landlords, and homeowners as clients, whom they can refer to the lawyer in a mutually beneficial, noncompetitive lead generation networking relationship. They might share clients without competing for business in any way or form.
Firms need to be attentive to the number of segments they choose to focus their limited resources on—both selecting too many or too few segments can cause problems in the long run [70]. Too many might not make the firm’s scarce resources stretch far and wide enough to tailor differentiable value to the specific needs of consumers; and too few segments might lead to a marketing plan that fails due to the demise of certain segments, as the context shifts.
Once the market is divided into a select few, likely segments (seen from the perspective of the marketer), marketers need to evaluate the segments’ attractiveness by asking four basic questions: Is the market large, growing and likely to be profitable enough to pursue (MONEY)? Would the marketing communications and our marketing mix allow us to access these prospective customers, OR would we be able to reach this segment via particular, customized, or well-targeted media (MARKETING ACCESS for ACQUISITION)? Does targeting this segment fit in with the vision, mission, and strategies of our firm (CONCENTRATED) and the capabilities the firm has, or is it able to acquire within a fairly concentrated time (CAPABILITIES)? Used as an acronym, these four questions spell out MACC. Marketing experts Freytag and Clarke [71] suggest evaluating potential segments by considering three strategic imperatives: (i) firm strategy; (ii) resource demands; and (iii) future attractiveness. Table 2 illustrates the construct and the building blocks of each off these selection criteria. In some cases, the firm will develop its own new market segments to align with the need they wish to fill. For example, Swatch watch producers educated consumers that a watch can be more than a time-keeper and an inheritance—it can be a statement of style, fashion, and personality—thus creating a new category with new demands and thus an entirely new segment of watch wearers. The Sony Walkman portable audio player, launched in 1979, was the first truly “totally portable” stereo cassette recorded music player [72]. It was much smaller than an 8-track player of the earlier cassette recorder/players, was listened to with stereophonic headphones (unlike previous equipment which used small loudspeakers), and was small enough to be carried around. Sony educated consumers that they can compile their own music playlists (no need to buy the full record/cassette) and that buyers could take their playlist wherever they went. Today’s music lovers can download the Sony Walkman Music Player Android App APK for high-definition music player only for Android smartphones and listen to “your own playlist of….stylish, sizzling music” [73].
Segmentation selection criteria | Concepts and considerations |
---|---|
Firm strategy | Corporate vision and direction Brand positioning and reputation Management commitments Organizational requirements Marketing objectives Competitive positioning |
Resource demands | Technology Relationships Human resources, purchasing of resources Services and sales Production Image Capital investment required New product development (R&D) |
Future attractiveness | Size and growth Profitability Relative risk Competition Government considerations Contextual considerations Technological demands (of the firm, from clients) Current relationships Development of new relationships |
Segmentation selection criteria (adapted from [71]).
Once a firm has considered the viability, they need to focus efforts on a few segments they wish to serve. This set of prospects, buyers, and customers with a set of homogeneous characteristics is called a target market. When firms select highly similar segments and focus on the commonalities of all segments, they are essentially undifferentiating the marketing mix. This is only a viable strategy if the competition is limited. For a differentiated marketing strategy, marketers design specific marketing communication and marketing mixes for each target segment. When represented as a web of activities, Figure 8 depicts how a variety of tools and investments at various levels could be used to best satisfy the unique needs of different segments. For Target 1 consumers, a large number of product offerings (willingness to personalize products, e.g., luxury robots) are available, while the firm offers a very low range of unsophisticated products to Target 2 customers (this might be the very basic products with no frills). So, for Target 2 customers, the price band is narrow (small variances in price). The budget to promote the product is also low. These “basic” products could be sold in a variety of outlets, including online sites, while the luxury, highly customized products for Target 1 are sold only in exclusive boutique stores. The physical evidence (such a packaging, branded material, and point-of-sale items) and people (sales professionals and customer care officers) for Target 2 may be more varied, due to a large number of outlets involved in the sales process. Partners such as franchisees and the various site owners will be numerous for the marketing strategy to reach and distribute to Target 2 consumers (Figure 12).
The marketing mix for two unique target markets.
To facilitate the integration of all communication from the firm with the selected target markets (IMC), all segments need to firstly be aligned with and secondly keep in pace with changes in firm strategy, culture, tactics, structure, capabilities, and resources [74]. Authors Dibb and Simkin [74] suggest that internal (to the firm) audiences need to be identified who play key roles in communicating and liaising with customers, to allow them to make changes to marketing plans and communication programs to stay congruent with the MSP. To implement the selected or revised segmentation plan, managers will need to be given specific responsibilities and resource (time, money, staff, equipment) to roll our solutions to these segments. Finally, various business units will need to develop methods to monitor and control the effective implementation of the SMP.
Once upon a time, filling stations sold petrol and supermarkets sold food and groceries. Today, filing stations sell a wide range of products from oil, diesel, and petrol to automated car washes, fresh coffee, pastries, groceries, and a wide range of snacks. Grocery stores sell everything from fresh produce to kitchen utensils, clothing, pharmaceuticals, magazines to garden furniture, flowers, and DIY tools. Some category-less firms take a large share of wallet (% of consumers’ discretionary budgets), offering a wide range of products, services, and solutions. For example, Walmart and Tesco brands can probably sell customers anything, including legal advice and wedding planning. In New Zealand, grocery giant Foodstuff’s grocery stores, New World, sell everything from bread and milk to socks, medicine, glassware, gardening equipment, and electric blankets.
Adept marketers understand the power of the brand and the role of “positioning” in accessing their larger-than-fair share of wallet. It is critical in this hyper-competitive, borderless marketplace to understand how to attain and retain a sustainable competitive advantage. Marketers use a variety of positioning activities to develop a meaningful distinction from competitors in the mind of current and future customers [7]. Several possible sources of SCA can be found in the eight Ps of the marketing mix: product differentiation, competitive pricing (based on cost efficiencies), distribution channels (including online and global logistics), promotions and special offers, and innovation (including R&D, patents, and intellectual property) [75]. A key selection criterion to determine possible sources of differentiation is that the selected target markets of the firm must see these attributes, characteristics, and variables as valuable, as discussed in the next section.
Once a firm has selected the (few) target markets to focus its limited resources on, it must determine a differentiation and positioning strategy. There are four distinct (but iterative) steps in this process:
Step 1: Identify a set of possible differentiators that are likely to create a sustainable competitive advantage.
Step 2: Choose advantages that are valuable to the firm and to the target audience(s) and on which the firm hopes to build a position (in the minds of those prospective consumers.
Step 3: Select and design an overall positioning strategy.
Step 4: Design and implement integrated marketing and communication tactics to support the overall positioning strategy. It is imperative to sustained success that marketers review these four steps and decisions related to those steps regularly (as they review target segments as well) and renew and refresh ideas and strategies regarding their SCA and the tactics to create and maintain distinctive benefits and distinguishable advantages (Figure 13).
Four iterative stages in creating a positioning strategy.
A brand’s full positioning is defined [61] as developing a theme that will produce a meaningful distinction for customers. According to Kotler [3], a product’s positioning is the complex set of perceptions, impression, and feelings that consumers hold for the product compared to its competitors’ products (goods and services). Therefore, brand positions are essentially a place made in the mind of consumers, whereas products are made in factories [7]. Firms can decide on the feature and include benefits in the products and services to ensure a particular set of attributes is associated with the product. In this way, firms can ensure that their product-service offering occupies a specific (predetermined) place in the mind of potential and existing customers. For example, Volvo is positioned as safe care, due to the manufacturer’s emphasis on safety through technological advancements [76], whereas BMW owns the brand position space of quality and excellence in the driving experience, due to its constantly reinforced brand message of “sheer driving pleasure” and more recently “ultimate driving machine” [77] and “designed for driving pleasure” [6]. In fact, it seems the slogan “Vorsprung Durch Technik” has transformed the entire positioning of the national brand of German products, and in particular family cars, to a position of quality, efficiency, progress, and technological innovations [78]. Marketers cannot leave their positioning to chance or to the consumer to decide—because consumer will position products and brand with or without the intervention of marketers. But, to get the greatest competitive advantage, marketers have to design and actively pursue planned positions.
To identify perception gaps or to identify positioning opportunities in the marketplace, marketers use perceptual maps. A perceptual map can be used to display comparative brands’ positions—as they relate to benefits sought by particular target audiences. Marketers use several perceptual maps contrasting a variety of key attributes (as sought by consumers and prospective buyers) to plan differentiation and positioning strategies and tactics. To allow for easy interpretation, and to clearly identify opportunities and threats, only two attributes are displayed at any one time, creating four quadrants. Figure 10 portrays such a comparative analysis of Australia/Pacific Airlines. On this particular perceptual map, the desirable positions are fairly close to the central point, OR the entire quadrant A, the top right hand corner of quadrant B (where the airline still has an acceptable status), or, if achievable, quadrant D. Airlines are unlikely to occupy quadrant C (high quality and low status)—unless they are not achieving well on another key attribute (say departing and landing on time). Airlines occupying quadrant D have high status and low quality of service. This is unlikely as most customers demand high quality of service despite paying less, and the airline will therefore have to achieve extremely high levels of satisfaction on other key attributes not portrayed on this particular comparison of attributes (say personalized onboarding, shorter waiting times, better luggage allowances, and other highly rated product and service attributes).
The orange dots on the perceptual map of airlines in Australia and New Zealand (Figure 10) indicate that Qantas and Air New Zealand are perceived as offering high-quality service and in-flight food and have achieved a high level of status in the minds of consumers in that region [79]. The red dots in the top right corner, adding Emirates and Cathay Pacific Airlines, indicate that a study among international students at a university in New Zealand added two airlines that are not normally seen as Australia/Pacific airlines, to the perceptual map. This study indicates that “real-world” surveys of target segments of consumers bring their unique perceptions of their own rankings into a brand’s perceptual map. Probing questions indicate that students often fly from New Zealand to their home countries (China, Japan, Saudi Arabia) using Emirates and Cathay Pacific and these airlines are ranked higher in status and quality of service than the best Australia/Pacific airline brands. Marketers should take from this that it is really important to survey real consumers and current customers to see what the true current reality looks like (Figure 14).
Perceptual map of Australia/Pacific airlines 2018 (source: world airline awards [79]).
The cluster in quadrant B indicates that there is very little differentiation in either food quality or status of the six airlines competing in this space. Although Jetstar is perceived as of higher status, consumers’ perception of its service and food quality is barely different from Fiji Air. So, should Fiji Air decide to improve their service and food quality substantially, they may become a threat to Jetstar’s position in the marketplace—if all other attributes stay equal [79].
Students of marketing communications and SMP might ask: How many differences should a brand promote to attract a specific market segment or segments? Is it not confusing when a brand promotes several differences for the same product-service combination? For example, a shampoo by Schwarzkopf offers benefits such as treatment for dandruff, softening hair, adding gloss and shine, reducing breakages, and maintaining highlights or artificial color [80]. Clearly some customers would want all these benefits. The challenge though is for the brand to decide how to deliver on all four product benefits, without confusing the brand positioning. Should the brand consider just promoting one or two or three of these benefits? Should Schwarzkopf focus on one benefit per target audience, for example, just concentrate on adding gloss to highlighted hair, thus focusing on consumers who have their hair colored regularly. Or should the brand only focus on one offering towards consumers with dandruff problems and another on consumers with color-treated hair? Should these feature as separate benefits offered to separate target audiences? Should all the be combined and risk loss of clear positioning, but gain a wider appeal to diverse target audiences?
A brand’s value proposition is a clear statement that explains what benefits the brand provides for who and how the brand does it uniquely well. It describes the target buyer, the pain points it offers solutions for, and why the brand is better than any competitive substitutes or alternative solutions [81].
“The full mix of benefits a brand offers to a range of segments is called the brand’s value proposition”.
Some examples of carefully crafted, single-sentence statements by brands are Lyft, “Rides in Minutes”; Budweiser beer, “The Great American Lager”; and Walmart, “Save Money. Live better.” According to scholars, there are only five combinations of benefits and price combinations which are “winning value propositions,” namely, offering more value (benefits to the customer) for a lower price (more for less strategy) or offering more value for a higher price (more for more = luxury and top-tier products at a higher price tag, e.g., Louis Vuitton Bags) or more value for the same price (more for same = comparable product quality but at a lower price, e.g., Lexus versus Mercedes) or the same value but for a lower price (same for less = or lower-tier brand such as Maybelline as a L’Oréal) or fewer benefits for a much lower price (less for much less = discount store or every-day-low-price stores such Pak’nSave, Checkers Warehouse stores, or Formula1 Hotels). Other alternatives on the price/benefit matrix are losing value propositions [82, 83]. (See Figure 3 for the winning value propositions highlighted in orange. Losing propositions are marked with a red X) (Figure 15).
Various winning and losing differentiating strategies.
According to Consulting Group Symmetrics [84], a market segmentation strategy should answer five key questions:
What markets do we pursue?
Which customers do we target?
Which marketing and sales channels fit with how our customers buy?
How do our offerings fit with our markets and channels?
What is our unique value proposition to each target customer?
From this chapter, it is clear there are many market segments a particular firm can profitably pursue. So, marketers have to carefully define which offerings and messages most likely to resonate with their target markets and differentiate the firm from the competition. So, conducting highly focused competitor analyses regularly is a STP imperative. These competitor analyses are aimed at finding ways to counter or improve what does or does not work, to guide business decisions regarding redefining, contracting, or expanding target markets. Marketing managers (including sales, PR, sponsorship, advertising, management) need to monitor if the STP plans work continually. Firms need to measure, monitor, and track your key performance metrics via weekly, monthly, and quarterly reports (also called dashboards of big data) to ensure mid-course adjustments to strategies, tactics, and the use of marketing and sales resources. Consultants Tracey and Wiersema [85, 86] suggest that firms can deliver superior value to their target segments, by following three value principles: (i) operational excellence which delivers superior value by leading price and convenience; (ii) by tailoring products and services to exactly match targeted customers’ needs termed customer intimacy, responding quickly to changing needs; and (iii) by offering a stream of innovative, leading-edge products and services through relentless pursuit of new solutions relevant for the firm’s focus segments, labeled product leadership. An example of operational excellence (lowest net-land cost) and customer intimacy excellence comes from office stationery supplier Staples USA. This chain focuses on a particular segment, namely, SMEs with fewer than 50 staff, and builds customer intimacy through loyalty cards and a club. Every time buyers use the card—which they need to access the discount—Staples capture data that allows the firm to monitor changing needs and applications and respond immediately to innovate to satisfy the market.
Constant evaluation and re-evaluation of each segment ensure that the firm does not waste resources on segments that will not value your firm’s offerings or do business with the brand. Adept markets are clear on the need to match the characteristics of the marketing segment to the qualities of their product offering(s) and the abilities of the firm to achieve sales performance objectives through a segmented marketing plan (STP).
There are both qualitative and quantitative tests to select, monitor, and control the MSP. Qualitative tests relate to the alignment with the firm’s vision, mission, and competitive positioning. Further qualitative tests relate to the four main questions, namely, “Do consumers in the segment (in both B2C and B2B segmentation plans) see our firm, its brand, and the products in the same light as the firm does, and vice versa?” In other words, “Do customers’ comments, reviews, responses, and other forms of communication (WOM) add to (or distract from) the unique positioning the firm envisages for its UVP and brand positioning? Are the selected marketing (sales, distribution, and communication) channels well aligned with customer channel preferences? A fourth question about the selected marketing and communication channels is: Can the channel handle consumer demands and two-way dialog?”
In terms of implementation, marketers need to develop and monitor the firm’s ability to communicate the desired positioning of the firm to target customers. Also, controls need to establish if all the firm’s efforts in the marketing mix support the MSP and positioning strategy (and vice versa).
Basic customer/market/sales quantitative performance and process measures applied to the firm’s targeted segments can provide measurements and an indication of success. Quantitative measures are specific to a particular firm, its selection of target segments and the firm’s channels, and sales and distribution practices. Further quantitative measures to determine segmentation success are set out in Table 3 and cover the four areas of markets, customers, channels, offerings, and value propositions.
Segments or markets | Market share (revenue %) (RMS) | Number of sales or gross sales revenue by market segment as a % of total market sales or size |
Relative market share (RMS) | Compare market share between top 5 competitors | |
Competitiveness (comp) | % customers for whom the firm is the first choice supplier or % market sectors in which the firm is the first choice supplier | |
Market contribution (MC) | Measure concentration, growth, and trends | |
Orders | Market penetration (MP) | Numbers of orders (per segment) as a percentage of total orders’ overall categories |
New product adoption (NPA) | % of sales turnover that is generated from new products/services in a given time period OR the % of orders that is generated from new products/services in a given time period | |
Customer relationships (CRM) |
| |
New customer acquisition (CU) | Number of new customers over the past year as a % of a number of customers in total or value of new customer sales as a % of total sales | |
Customers | Customer experience index (CXI) | Combine various CX values to the firm such as satisfaction, retention, and referrals |
Share of wallet % (SoW) | The firm’s share of addressable spent by customers in the segment | |
Customer loyalty % (CLTV) | Quantify from an aggregation of loyalty measures such as repeat purchases, the number of different products purchased, relationship duration, and loyal customers | |
Returns per customer per segment (RoR) | Average ratio of returns per customer over a specified period: 30/60/90 days | |
Channels | Expense per revenue % (E/R) | Expense and revenue of each channel |
Channel mix % (CM) | Channel concentration and growth trends | |
Channel performance/plan (CPP) | Channel performance vs. budget/forecast/event/plan | |
Offerings | Offering % | Year-over-year performance of each offering (product/service) |
Profitability % per offering (P/O) | Realization of value message in the profitability of purchases | |
Revenue % of new offerings (R/NO) | Use period of a typical life cycle of a client (can be <1 year) | |
Unique value proposition | Win ratio % (wins/C) | How many new clients or $ do we win? |
Competitive replacement % (CR) | Are you able to displace the competition? | |
Margin % trends (margin T) | Gross, operating, and net value |
Quantitative measure of segmentation success.
Set out below are some of the measures that are relevant to determine if a target segment is viable and likely to generate profitable business in the long term. These measures link well with the MADD MACC model discussed earlier and are used by marketers to assess their segmentation and target market plans.
Responsiveness: homogeneous, unique response within a segment, heterogeneous between segments.
Actionability: segments and firm’s goals/competencies should match.
Substantiality: segments should be large enough.
Identifiability: easily measurable segmentation variables.
Accessibility: effective promotional/distributional tools needed.
Stability: composition of segments should not change rapidly.
Market segmentation will become more complex and more varied as the solutions consumers need and are able to demand become more easily available and more globally diverse. Understanding the challenges, opportunities, and the complexity of factors to consider will therefore become even more important to marketers. Unfortunately there is no one recipe to suit all products, all firms, or even similar segments. The success of marketing interventions is likely to depend on marketers’ ability to gather consumer insights, firms’ ability to adapt and innovate fast to become and remain the provider of preference, and constantly collaborating with various stakeholders to co-create solutions of value to target audiences. With a marketplace of more than 7 billion people, constant innovation will be the only constant, and marketers will constantly need to find new ways to understand, influence, and provide value to a wide range of divergent markets.
Advil | L’Oreal |
AirBnB | Lyft |
Amazon | Maybelline |
Android smartphones | Mercedes |
Apple | MSC Cruises |
BMW | New World |
Boeing | Orbit Travel |
BTS | Pack’n Save |
Budweiser | Pam Golding |
Coca-Cola | Pepsi |
Colgate | |
Constant Comedy.com | Prosecco |
Cosco | P&G |
Dell | Qantas |
DeSpar | Radian6 |
Disprin | Range Rover |
DHL | Ray Ban |
Dreamliner | Ray White Properties |
Dry Bar Comedy | Red Bull |
Etsy Inc. | Reuters |
Salesforce | |
FedEx | Samsung |
Flickr | Schwarzkopf |
Flight Star | Sony, Sony Walkman |
Foodstuff | SPAR |
Gap NY | Staples USA |
GE | Tesco |
General Life (Insurance) | TradeMe |
Google; Google Plus, Google Circles; Google Analytics | TV10 |
Hallmark | |
HBO | Tylenol |
HSBC Banks | University of Sydney, Australia |
VOLVO | |
K-Pop | Vox News |
Lacta | Walmart |
Levi’s | Wendy’s |
Lexus | WriteWell |
YouTube |
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',metaTitle:"Terms and Conditions",metaDescription:"These terms and conditions outline the rules and regulations for the use of IntechOpen Website at https://intechopen.com and all its subdomains owned by Intech Limited located at 7th floor, 10 Lower Thames Street, London, EC3R 6AF, UK.",metaKeywords:null,canonicalURL:"/page/terms-and-conditions",contentRaw:'[{"type":"htmlEditorComponent","content":"By accessing the website at www.intechopen.com you are agreeing to be bound by these Terms of Service, all applicable laws and regulations, and agree that you are responsible for compliance with any applicable local laws. Use and/or access to this site is based on full agreement and compliance of these Terms. All materials contained on this website are protected by applicable copyright and trademark laws.
\\n\\nThe following terminology applies to these Terms and Conditions, Privacy Statement, Disclaimer Notice, and any or all Agreements:
\\n\\n“Client”, “Customer”, “You” and “Your” refers to you, the person accessing this website and accepting the Company’s Terms and Conditions;
\\n\\n“The Company”, “Ourselves”, “We”, “Our” and “Us”, refers to our Company, IntechOpen;
\\n\\n“Party”, “Parties”, or “Us”, refers to both the Client and ourselves, or either the Client or ourselves.
\\n\\nAll Terms refer to the offer, acceptance, and consideration of payment necessary to provide assistance to the Client in the most appropriate manner, whether by formal meetings of a fixed duration, or by any other agreed means, for the express purpose of meeting the Client’s needs in respect of provision of the Company’s stated services/products, and in accordance with, and subject to, the prevailing laws of the United Kingdom.
\\n\\nAny use of the above terminology, or other words in the singular, plural, capitalization and/or he/she or they, are taken as interchangeable.
\\n\\nUnless otherwise stated, IntechOpen and/or its licensors own the intellectual property rights for all materials on www.intechopen.com. All intellectual property rights are reserved. You may view, download, share, link and print pages from www.intechopen.com for your own personal use, subject to the restrictions set out in these Terms and Conditions.
\\n\\nWe employ the use of cookies. By using the IntechOpen website you consent to the use of cookies in accordance with IntechOpen’s Privacy Policy. Most modern day interactive websites use cookies to enable the retrieval of user details for each visit. On our site, cookies are predominantly used to enable functionality and ease of use for those visiting the site.
\\n\\nIn no circumstances shall IntechOpen or its suppliers be liable for any damages (including, without limitation, damages for loss of data or profit, or due to business interruption) arising out of the use, or inability to use, the materials on IntechOpen's websites, even if IntechOpen or an IntechOpen authorized representative has been notified orally or in writing of the possibility of such damage. Some jurisdictions do not allow limitations on implied warranties, or limitations of liability for consequential or incidental damages; consequently, these limitations may not apply to you.
\\n\\nIntechopen.com website content and services are provided on an "AS IS" and an "AS AVAILABLE" basis. Material appearing on www.intechopen.com could include minor technical, typographical, or photographic errors. IntechOpen may make changes to any material contained on its website at any time without notice.
\\n\\nIntechOpen has no formal affiliation to any external sites that link to www.intechopen.com, unless otherwise specifically stated. As such, it is not responsible for content that appears on any such sites. The inclusion of any link to IntechOpen does not imply endorsement by IntechOpen. Use of any such linked website is done solely at the user's own discretion.
\\n\\nWe reserve the right of ownership over our entire website www.intechopen.com, and all contents. By using our services, you agree to remove all links to our website immediately upon request. We also reserve the right to amend these Terms and Conditions and our linking policy at any time. By continuing to link to our website, you agree to be bound to, and abide by, these linking Terms and Conditions.
\\n\\nIf you find any link on our website, or any linked website, objectionable for any reason, please Contact Us. We will consider all requests to remove links but will have no obligation to do so.
\\n\\nWithout prior approval and express written permission, you may not create frames around our web pages or use other techniques that alter in any way the visual presentation or appearance of our website.
\\n\\nIntechOpen may revise its Terms of Service for its website at any time without notice. By using this website, you are agreeing to be bound by the current version of all Terms at the time of use.
\\n\\nThese Terms and Conditions are governed by and construed in accordance with the laws of the United Kingdom and you irrevocably submit to the exclusive jurisdiction of the courts in London, United Kingdom.
\\n\\nCroatian version of Terms and Conditions available here
\\n"}]'},components:[{type:"htmlEditorComponent",content:'By accessing the website at www.intechopen.com you are agreeing to be bound by these Terms of Service, all applicable laws and regulations, and agree that you are responsible for compliance with any applicable local laws. Use and/or access to this site is based on full agreement and compliance of these Terms. All materials contained on this website are protected by applicable copyright and trademark laws.
\n\nThe following terminology applies to these Terms and Conditions, Privacy Statement, Disclaimer Notice, and any or all Agreements:
\n\n“Client”, “Customer”, “You” and “Your” refers to you, the person accessing this website and accepting the Company’s Terms and Conditions;
\n\n“The Company”, “Ourselves”, “We”, “Our” and “Us”, refers to our Company, IntechOpen;
\n\n“Party”, “Parties”, or “Us”, refers to both the Client and ourselves, or either the Client or ourselves.
\n\nAll Terms refer to the offer, acceptance, and consideration of payment necessary to provide assistance to the Client in the most appropriate manner, whether by formal meetings of a fixed duration, or by any other agreed means, for the express purpose of meeting the Client’s needs in respect of provision of the Company’s stated services/products, and in accordance with, and subject to, the prevailing laws of the United Kingdom.
\n\nAny use of the above terminology, or other words in the singular, plural, capitalization and/or he/she or they, are taken as interchangeable.
\n\nUnless otherwise stated, IntechOpen and/or its licensors own the intellectual property rights for all materials on www.intechopen.com. All intellectual property rights are reserved. You may view, download, share, link and print pages from www.intechopen.com for your own personal use, subject to the restrictions set out in these Terms and Conditions.
\n\nWe employ the use of cookies. By using the IntechOpen website you consent to the use of cookies in accordance with IntechOpen’s Privacy Policy. Most modern day interactive websites use cookies to enable the retrieval of user details for each visit. On our site, cookies are predominantly used to enable functionality and ease of use for those visiting the site.
\n\nIn no circumstances shall IntechOpen or its suppliers be liable for any damages (including, without limitation, damages for loss of data or profit, or due to business interruption) arising out of the use, or inability to use, the materials on IntechOpen's websites, even if IntechOpen or an IntechOpen authorized representative has been notified orally or in writing of the possibility of such damage. Some jurisdictions do not allow limitations on implied warranties, or limitations of liability for consequential or incidental damages; consequently, these limitations may not apply to you.
\n\nIntechopen.com website content and services are provided on an "AS IS" and an "AS AVAILABLE" basis. Material appearing on www.intechopen.com could include minor technical, typographical, or photographic errors. IntechOpen may make changes to any material contained on its website at any time without notice.
\n\nIntechOpen has no formal affiliation to any external sites that link to www.intechopen.com, unless otherwise specifically stated. As such, it is not responsible for content that appears on any such sites. The inclusion of any link to IntechOpen does not imply endorsement by IntechOpen. Use of any such linked website is done solely at the user's own discretion.
\n\nWe reserve the right of ownership over our entire website www.intechopen.com, and all contents. By using our services, you agree to remove all links to our website immediately upon request. We also reserve the right to amend these Terms and Conditions and our linking policy at any time. By continuing to link to our website, you agree to be bound to, and abide by, these linking Terms and Conditions.
\n\nIf you find any link on our website, or any linked website, objectionable for any reason, please Contact Us. We will consider all requests to remove links but will have no obligation to do so.
\n\nWithout prior approval and express written permission, you may not create frames around our web pages or use other techniques that alter in any way the visual presentation or appearance of our website.
\n\nIntechOpen may revise its Terms of Service for its website at any time without notice. By using this website, you are agreeing to be bound by the current version of all Terms at the time of use.
\n\nThese Terms and Conditions are governed by and construed in accordance with the laws of the United Kingdom and you irrevocably submit to the exclusive jurisdiction of the courts in London, United Kingdom.
\n\nCroatian version of Terms and Conditions available here
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