Marketing Needs

Multiple Niching – A Safer Option

Posted on: October 3, 2008

With increasing competition, niche markets are becoming smaller and smaller. Thus, by depending on a single niche, there is the real danger of the niche drying up, thereby, having negative consequences for the organization. For larger companies with multiple brands, there is always the threat of one brand eating into the other i.e., cannibalization. Many companies have realized this fact and therefore, have adapted the strategy of marketing to multiple niches. Thus, while Citibank’s Taj Epicure Diner’s club credit card offers a host of privileges at Taj group of hotels and restaurants for a memorable dining and staying experience, its Diner’s club international British Airways credit card offers a host of airline travel privileges and benefits through British Airways.

Reniching

In some cases when the company feels that a change in the target segment is imperative, or that the brand needs to be shifted from its present positioning, it resorts to reniching strategy. Thus Dairy Milk chocolate which was originally targeted at children, was repositioned and targeted at young adults and this aspect was reinforced through the famous “cricket dance” commercial. Presently it has been repositioned again by targeting the product as meant for all those who are young at heart, with Big B as the Brand Ambassador.

Going for a Niche Marketing Strategy

If any organization decides to pursue niches, it needs to prepare the groundwork by thoroughly analyzing the following areas:

•    Existing competitors in the niche (if any), their major clientele, billings, realizations and revenues.

Niche Marketing — A Strategic Perspective

• The growth rate of the niche being targeted.

• In case of a crowded niche, the strategy for the organization s prominence.

• The added benefits provided by the organization vis-a-vis competitors.

• A detailed analysis of the characteristics of the prospects in the market and beneficiaries of the organization’s offerings.

• Analysis of effective media to reach the targeted niche market.

Conclusion

Thus, it can be safely summarized that niche marketing as a strategy has not only been practiced by small companies, but also by large organizations. Small companies have adapted this strategy to provide a specialized offering to a select customer profile, while large corporations have practiced this strategy as a defense against invasion by small niche players. Niche Marketing, to be a successful strategy, requires a small homogenous group of customers with a clear set of needs and willing to pay a premium to satisfy their needs and only a few companies operating in the Same space. Moreover, the niche should have the required profit and growth potential and enable the organizations to specialize. To sum up, the role of a niche marketer is to create/identify niches, expand niches and protect the niches.

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