< HOME / news

How does market segmentation work with SMEs?

May 10, 2021

No items found.
No items found.

Market segmentation is well established as a theory but remains challenging when dealing with innovation as no consensus exists on how to benchmark innovation activities. SME policy interventions have shown attempts at segmentation, some quite sophisticated...  

However, there is now evidence that segmentation needs to be based on value and requirements rather than administrative definitions such as size and sector. Having a segmentation that identifies the best SMEs can improve the incentives made available, support the development of customised marketing messages and help focus on the opportunities that can provide the best return on investment for the public sector. 

The objective is therefore to create a segmentation that is easy to use and replicate, through the development of a simple quality score. Complex segmentation methodologies are unlikely to be used unless organisations work with segmentation specialists.  

There are several approaches to segmentation. The simplest one classifies SMEs according to publicly available characteristics such as industry and company size. SME segmentation can also be based on their needs. However, the value that would be created by supporting a group of SMEs must also be considered to ensure the best value for money. Value can translate into economic profitability, employment, social and environmental impact, or a combination of these.


The purpose of the segmentation is to identify common characteristics that define the ‘good’ innovative SMEs; the ones that if they benefit from incentives and support will translate into value. A key challenge however in developing the segmentation was the access to key data that could represent the abilities of SMEs to translate support into economic value.  

May 10, 2021
← back to news
Thank you! We will be in touch shortly.
Oops! Something went wrong while submitting the form.

More of our news

The Human Element: Balancing Technology and Empathy in a Hyperconnected World
In our hyperconnected world, technology has transformed the way we communicate and interact with each other. From smartphones and social media to video calls and virtual reality, we rely on technology to connect with others, access information, and streamline our tasks. While technology and its evolution have undoubtedly brought many benefits, it has also led to concerns about the erosion of the human element in our interactions.
May 18, 2023
Unlocking the Power of International Collaboration: How Working with Partners Abroad Can Benefit Your R&D Activities
It's no secret that we're living in a hyperconnected world, where challenges can feel overwhelming as we huddle behind our screens. However, collaboration is the key that unlocks the door to enduring solutions, and we've witnessed this first-hand during the COVID-era. Global communities united to contain the spread, develop vaccines, and establish effective treatments. This joint effort played a crucial role in restoring a semblance of order amidst the chaos.
May 11, 2023
What to Consider When Choosing Your Grant Writer – the Importance of the Human Touch
Over the past two decades of writing grant applications, I've experienced the transformation of government funding. When InnovateUK was still called the 'Technology Strategy Board,' many businesses were unaware of available grants, and some were hesitant, thinking that such non-repayable funding was too good to be true.
May 3, 2023
Navigating the Ethical Crossroads: Striking the Balance between Grant Compliance and Innovation
In a world where market disruption and system modernisation are the norm, grant-funded projects face the challenge of balancing compliance and innovation. On the one hand, strict regulations ensure ethical conduct and resource allocation, while on the other, innovation is essential for solving complex problems and driving progress.
April 19, 2023
Unlocking the Potential of Sustainable Technologies: How R&D Tax Credits Can Pave the Way
Unlock the potential of sustainable technologies and pave the way towards a greener future with R&D Tax Credits. Learn how this government incentive can help your business reduce costs, improve cash flow, and drive innovation for environmental sustainability.
April 3, 2023
Common mistakes to avoid when writing a grant proposal
Key to writing a good grant proposal is to be diligent, focused and persistent. By avoiding common mistakes like lack of clarity, unrealistic budgeting, and failure to meet the funder’s priorities, you can increase your chances of getting grant approvals. Carefully plan your proposal while adhering to the submission guidelines and stay true to your project vision to bring your project to life.
March 14, 2023