When the Industrial Revolution began and the concept of a product or service was introduced, marketing was non-existent. There was no competition, just generic products and naturally, companies felt no need to invest in this arena. Over the last two centuries, things have changed drastically. Today, marketing itself has divulged into various branches, one of the newest being niche marketing.
What is Niche Marketing?
Among the various forms of marketing that exist today, niche marketing is one of the most recent. The idea refers to products and services being pitched to a small yet specific target audience. For instance, luxury goods like high-end supercars are a niche product. Only limited units are built and customers are hand-picked by company representatives. Although the number of items sold are low, the high price means greater profits amidst numerous other benefits.
Why it is Relevant Today?
Owing to extensive competition in almost every market, businesses are having a hard time catering to their customers, especially when it comes to finding new ones. Moreover, the enhanced levels of consumer awareness make it harder to meet their satisfaction levels. This is where niche marketing becomes relevant.
Companies now divide their existing target markets into smaller chunks based on different parameters like age, gender, certain personality traits etc. Then, they simply offer customized versions of the products or services they originally make. Naturally, this brings a number of benefits which allow companies to create sustainable revenue models for themselves.
The Benefits of Niche Marketing
Many brands and large corporations are adopting niche marketing concepts because extensive research supports the fact that it is effective. Shampoo manufacturers, such as Pantene, launching extensive ranges based on various different hair types is a classic example. Here are a few other benefits of niche marketing besides driving a business towards financial stability.
Helps Build Stronger Customer Relationships
A customer remains every company’s biggest asset. Niche marketing helps create greater affinity between a brand and its users because the latter can attach more feelings to it. When consumers feel that a company is listening to their demands the begin to love it and eventually become loyal advocates.
Cost-effective Advertising for the Company
Niche marketing is one branch of advertising that doesn’t require substantial investment. When a company begins to offer more personalized services or products, customers notice and they talk about it on social media platforms and within their social circle. This word-of-mouth is one of the best marketing tools for a company and it costs only a fraction of what other mediums do.
Opportunity to Develop Expertise
Niche marketing does require committing resources towards developing iterations of existing products that fulfill customer needs appropriately. This requires a company to develop certain skills in that area through research and development. This process helps develop long term abilities like better project management. A business can obviously benefit from this in the long term.
Niche marketing is a concept that has proven its effectiveness ever since companies began to implement it. The true outcomes however, depend on how well the business can study its consumer base, their requirements and then act on it accurately.