Online marketing is a very essential marketing tool that is defined as “focusing on sub-segments or niches with unique traits which may seek an exclusive combination of rewards (Kotler & Armstrong, 1997)
Niche approach or sometimes-called focus approach is a promoting segmentation approach that concentrates or focuses on a few goal markets. Users of this strategy hope that by centering on a few (one or two) markets sections that are slim, they would be in a better placement to meet the needs of this market. Which means company aims to tailor make their marketing combine to suit these kinds of specialized market segments that it provides identified.
Utilizing the niche technique the company very easily stands to gain or have a competitive benefits by being successful rather than efficient. (Kotler & Armstrong, 1997)
Niche approach in most cases is appropricate for small firms although it is definitely open to any business which would want to utilize it in selecting focuses on with lower substitute weeknesses or where there is weakened competition. (Kotler & Armstrong, 1997)
There are several factors that greatly enhance a successful niche strategy including:
1) Market “research
Before growing any niche market it is very important to conduct an extensive market research from the desired market before embarking on any marketing program. Towards this kind of end, a SWOT evaluation that illustrates the strength and weaknesses in the company vis-Ã -vis the market this desires to part is very required. (Chisnall, G. M. 1997)
The market research will allow the company determine the market features that will permit it provide this particular segment in a better way. These kinds of characteristics will include, consumer preferences, attractive price ranges level of competition, product differentiation, syndication channels, the marketing blend and other sorts of important marketing variables. (Chisnall, G. M. 1997)
When these types of characteristics have already been established and defined the company on their part styles a marketing model that should address the target market and become a successful venture intended for the company. The market research itself will permit the company not simply identify an industry but will give it more information for the demographic great the market too. (Chisnall, P. M. 1997)
2) Produce customer devotion.
One major threat to establishing and growing any niche can be competition. Competition may take a talk about of the company’s market, lowering the profitability or perhaps worse even now drive your company from the market. To this end it is very important pertaining to the company for making it it is priority to become the customers. If the company makes it its goal to cautiously listen to the customers, it will have a chance to create goods and services that will not just meet consumer expectations but actually will meet their needs as well.
Hearing the customer is going to enable the company differentiate their product range to fit the needs of the market. This will in turn create devotion that will enable the company weather conditions any form of competition, in fact when customers are faithful it will be very hard for them to search for other alternatives or in order to the competition. (Peter, M. P. and Olson, T. J., 1996)
3) Develop two or more niche categories
By expanding two or more markets it will prove quite advantageous to the company in many ways. Any potential problems and lessons gained in other niches will give the company a chance to tackle the challenges that could likely to result from a different niche. (Baker, M. 2000)
Two or more niches alternatively may work to supporting each other especially in the creation of any type of competition, for example when 1 niche is usually faced with competition other niche categories can be of big support particularly if price competition would be necessary.
Two or more markets supporting one another gives the organization a power that would permit it preserve any sort of marketing campaign to keep up high market penetration. By managing two or more niches, the company lessens the risk of closing shop in the event one of the niches collapses or perhaps is confronted with competition and there’s a reduction in profitability amounts. By simply developing a lot more than two niche categories the chances of accomplishment are improved tremendously as well. (Baker, Meters. 2000)
4) Focus on a certain region
To obtain successful specialization, it is important intended for the company to cope with those geographic markets that other competitors ignore. By simply focusing on a certain region, it is easier pertaining to the organization to develop a syndication channel that will not only be effective in terms of strategies but will ensure timeliness inside the distribution of products or companies. By centering on a particular location, it allows the company to create or design an effective marketing strategy to promote and create knowing of its services and goods.
The company likewise stands a better chance of interacting with the customers deeper and freely to which circumstance it would be easier to predict the buying trends and the consumer preferences. (Linneman, R. Elizabeth. and Stanton, J. M. 1991)
Gamma PLC produces very high quality motors for garden mowers which fact gives it an edge over its rivals in this particular niche. However the company can not sit back and sit on it is laurels, It can be imperative pertaining to company to work extra hard to make sure it instructions these market especially with your competitors of these kinds of established companies like Phazer and Honda. To protect itself from this onslaught there are particular challenges which the company will certainly face that might force it out.
As it is, already the business is facing competition from such world acclaimed names like Yamaha and Honda. For this sort of names to be attracted to this sort of a market, then it follows which the market is extremely lucrative.
Molteplicit? PLC is not quite well known, apart probably for this particular market portion, unlike the competitors who are well established and with renowned brands. The big players if they would decide to bend their muscles, this might travel out Gamma from this specific niche market. (Linneman, 3rd there’s r. E. and Stanton, T. L. 1991)
They can do that in various ways including strongly utilizing the 4ps (Price, promotion, merchandise and place) of marketing. The type of marketing or promotion blitzlys they would very likely conduct, could obviously always be superior compared to Gamma’s with a lesser budget. Besides, these types of companies’ is likely to introduce value wars that could have adverse effect on Gamma Plc, whose budget may likely be comparatively small. The latter’s prices cannot compete with those kinds of the more established firms.
This type of competition might prove to be a nightmare pertaining to Gamma whose niche is usually under risk. After all, the bigger companies’ important thing would not be affected in any respect because their presence is definitely worldwide and they are more experienced and advanced particularly with the marketing capabilities. (Linneman, R. At the. and Stanton, J. D. 1991)
The competitors could also decide to choose or even backup how Molteplicit? Plc is definitely producing its high quality engines, thereby proclaiming some of the business.
Competition could also come in conditions of remuneration and personnel training where other organizations may be appealing to employees in Gamma.
The niche strategy may be limiting
By taking on and relying on this particular specialized niche the company will be faced with another challenge of future progress. Because it may well expend every its powers trying to guard this market from Yamaha and Honda it might lack the resources to venture in other markets thereby limiting its growth. This can be always foreseen especially if the companies are relatively small. As time goes by Gamma’s market share may shrink which might eventually impact its continuing production of highly top quality motors. (Linneman, R. Elizabeth. and Stanton, J. T. 1991)
Is definitely the market defensible?
This should end up being the question that needs to be ringing for Gamma Plc’s management. It would not be worthwhile to cling to one niche especially if it is not defensible. The majority of small companies like Molteplicit? will find that challenging to judge this specifically bearing in mind that is the marketplace that facilitates the organization. The corporation may shortage the resources to get out if the competition becomes intolerable and set up another niche elsewhere. (Linneman, R. At the. and Stanton, J. L. 1991).
The market would be defensible if the clients within the market have shown the willingness to aid the company in spite of who concerns compete, which is to mean they are strictly loyal to Molteplicit?. It would also mean that the market would be not too young to bring about any combat over it. Even so if the market is small and downsizing there’s not need to waste the time to defend it.
Gamma Plc manufactures top quality products and mentioned previously before this might be the edge it might be having over the competition. However , it is worth noting that top quality in most cases provides a higher price. Therefore consumers would likely to be recharged more when compared with similar items from other corporations. Yamaha and Honda will take advantage of this kind of by providing less costly alternatives that the customers may select from. Which means that not all consumers use top quality as the driving getting factor. Most consumers is going for less expensive products supplied the provide similar features. This would power Gamma either to lower quality so that the merchandise becomes cheaper or search for more efficient ways of production. (Linneman, R. E. and Stanton, J. D. 1991).
Molteplicit? Plc almost certainly specializes in the availability of motor for back garden mowers, which essence signifies that they lack any other manufacturer product line, unlike Phazer and Honda who have a very wide product range, that runs from generator to motorbikes. The range is actually a very crucial marketing entry point for buyers who might not necessarily need motors pertaining to garden mowers yet they will possess them. (Linneman, R. E. and Stanton, M. L. 1991).
Baker, M. (2000) Marketing Managing and Technique, 3rd model, Macmillan Business.
Chisnall, P. M. (1997) Marketing Analysis, Fifth Edition, London: McGraw-Hill
Kotler, L. and Armstrong, G. (1997) Marketing An intro. Fourth Edition. NewShirt. Prentince Lounge International
Linneman, R. Elizabeth. and Stanton, J. D. (1991) Producing Niche Marketing Operate, New York: McGraw Slope
Peter, T. P. and Olson, L. J. (1996) Consumer Behaviour and Marketing Strategy, USA: Irwin