Niche v Mass Marketing

Niche marketing Targeting a product or service at a small segment of a larger market

Advantages Less competition Costs – little scope for cost reduction Small-scale production Tailor-made products Targeting customers effectively

Disadvantages Lower profits Changes in demand (more vulnerable) Market entry – larger firms attracted into the market

Mass marketing Aiming a product at all (or most) of the market

Advantages Large-scale production  economies of scale  higher profit margins High revenues Create barriers to entry for small firms Research & development Brand awareness

Disadvantages High fixed capital costs Changes in demand  capacity problems Effects of standardisation Competition – more vulnerable to low-cost competition from abroad Adding value – less scope

Product differentiation The degree to which consumers see a particular brand as being different from other brands Benefits firm through: Increased sales volume Greater scope for charging a higher price

Mass market How do you differentiate? Design, branding, packaging Clever promotional & advertising campaigns Different distribution methods NB – through employing elements of the marketing mix

Product proliferation When a variety of products are produced to serve different tastes, e.g. IPC Magazines: Woman’s Own Loaded Ideal Home Uncut