What does niche marketing mean?
Niche marketing represents all the marketing techniques used to promote products in niche markets. Therefore, communication will be individual and very targeted. Competition is less strong than in mass markets, which provides a better marketing opportunity. Finally, niche marketing allows you to create more intimate relationships between the customer and the company.
What is a niche market?
The niche market represents a very narrow market which offers very specific products or services adapted to targeted needs. To promote your product in a niche market, you must adopt a niche marketing strategy that meets the specific needs of this market.
The niche market offers an opportunity because the company can offer an exclusive or little-exploited product. However, low demand and higher production costs can weaken the profitability of companies that position themselves in the niche market.
What are the advantages of niche marketing?
Niche marketing has some advantages due to its specific configuration.
- There is less competition. The niche market offers partial or total exclusivity on the marketing of a product. As a result, competitors are fewer, or even non-existent. This makes it easier to generate attractive margins and increase profits. However, there will also be fewer consumers looking for the offer.
- Niche marketing increases brand loyalty. Niche marketing optimizes business loyalty. The company faces a smaller audience and can therefore focus on the quality of customer service and optimize relationships.
- A reduction in marketing costs. Thanks to the company’s positioning in a niche market, marketing and advertising costs are lower. Indeed, this type of market is very targeted, therefore it is more profitable.
Moreover, products linked to a passion which are in a niche market, push the consumer to grant a more substantial spending budget. In fact, consumers often make an impulsive or favorite purchase.
What are the disadvantages of the niche market?
Developing a niche marketing strategy can be risky. Indeed, the strategy will depend on a relatively small targeted market. As a result, the promotion of products and services will also be very targeted and limited.