Target A Small Part Of A Large Market
( Niche Marketing )
Sometimes it is possible to enter a large-volume market, with the goal of servicing just a small piece of it. This can succeed only when the market is so large that a small portion of it will be profitable.
Some Examples
-
The fast food industry is large and still growing rapidly. A woman opened a small fish restaurant in a suburban neighbourhood and succeeded despite major fast-food chains operating in the same area.
-
A small brewery opened with the intention of serving only a small percentage of the market. It was successful and did not pose a threat to major breweries.
-
Several software companies have realized profits by serving a small part of the computer market by offering specialized products to limited segments of the market.
How To Do It
-
Identify large-volume markets by examining economic reports, trade association figures and marketing studies.
-
Select a market in which you feel you could capture a small percentage.
-
Develop a plan that will allow you to compete effectively. Seek to gain an advantage through your location, type of facility, personal reputation, level of service, selection of goods, price, business concept or advertising.
-
Avoid highly competitive markets in which large organizations are battling for each single percentage point.
-
Talk with potential customers to find out whether they would buy the product or service you want to provide.
Key Questions
What high-volume markets exist?
Which would be the most suitable for a small operator to enter?
What product or service could I offer to gain a small percentage of a large-volume market?
What potential customers have said they would buy the product or service I want to provide?
Return to Forty concepts Table of Contents
|
