Author: Vincent Bernard
Date of Publication: 25/04/2023
Niche marketing is a specific marketing that consists of targeting a specific part of the population which is called a niche group. In particular, this can potentially be very interesting with our offer. A niche doesn’t exist but must be created by marketing techniques. So, a niche isn’t necessarily a little part of the population. In fact, it can be a big part of the population, but which has specific features. Therefore, implementing a niche marketing strategy can be very useful for a big
company but also a little company.
Step for creating a niche marketing strategy
1. Identify a niche market
First, identify the market you want to reach. Specifically, you can do so by considering the
demographic, psychographic and behavioural characteristics of your 'ideal' customer. Next, find the need you want to address by researching current consumer trends and conducting a competitor analysis.
This will spot a potential gap in your direct competitors that you can address through your offer. By doing so, you will stand out from the competition in the eyes of consumers
creating an offer with unique value. It is also important to be aware of changes and
developments that may affect the niche market you are targeting.
For example, you should conduct a PESTLE analysis. This way you will define the target
market. What’s more, you should take into account the internal and external environment
of the company. So, it would be good to carry out a SWOT analysis.
2. Segment the market
To segment your target market, you can do so in different ways. Indeed, consumers can be segmented by age, gender, location, behaviour or needs. Once this segmentation has been carried out, it is important to check the relevance of these segments to your project.
Therefore, you will need to assess the size of the potential market, the possibilities for
development and the profitability of each segment. This way, you will determine whether
the project is viable or not. Once the segmentation is done, you will choose which
segments offer the best profitability for your business. Then you will have to look at the
chosen segment to create an offer based on the needs of that target.
Advantages and disadvantages of niche marketing
Advantages:
Less competition
One of the major advantages of implementing a niche marketing strategy is that there will be much less competition. Targeting a specific population with a tailored offer means
fewer companies.
Retain
Targeting a very specific population practice allows you to offer them loyalty to your company. It allows you to offer the best possible quality in meeting their needs. So, you will establish a quality relationship with your customers and they will be loyal to your brand.
Save money
One of the major benefits is the cost saving. By targeting a specific segment, advertising is less likely to be wasted on ineffective campaigns. Since you understand your target audience and their needs, you can create the ideal advertising campaign to reach your niche.
Make your expertise valuable
Niche marketing companies usually have a higher margin because the offer they provide is not available anywhere else. Customers will pay whatever price it takes to get access to the offer. If you are using niche marketing, it is because you are specialised in your field to provide the best possible offer. This expertise can enable you to attract new customers to meet their specific needs.
Disadvantages:
Limited market
One of the major disadvantages of niche marketing is in its name, it is limited to a niche. This results in limited growth for the company as it has fewer opportunities to expand. Despite the fact that there are few competitors, competition can still be high. Indeed, companies targeting the same niche compete fiercely to demonstrate their expertise and superiority. In fact, companies that do not have the skills to deal with this strong competition may find it difficult to establish themselves in this niche market.
A risky strategy
Targeting a niche market, especially one that has recently emerged, is risky. It will attract other companies who want to take advantage of this opportunity to diversify their business, increase their profits etc. Although a niche marketing strategy can increase a company's turnover, it is not certain. Indeed, targeting a niche greatly reduces potential customers and profits if unsuccessful.
A dependent market
It also makes you dependent on that particular target and the target market. So if outside elements disrupt the market, this could have negative aspects for your business.
How use digital marketing in niche marketing
The use of digital marketing tools in implementing a niche marketing strategy. Market analysis and keyword research tools help to define target audience needs and interests. You can also increase your presence by producing quality content. So, you can share this content through the social networks most relevant to your target, through your website using SEO.
Example of successful niche business
Red Bull is one of the big companies that despite being consumed by many people uses niche marketing. In particular, the image of Red Bull is based on extreme sports because the brand sponsors a lot of events such as car races, parachute jumps etc ... By doing this, the brand has created a loyal customer base and differentiated itself from its competitors. Therefore, on these social networks, it shares content related to the events she sponsors.
Conclusions
Implementing a niche marketing strategy is a great way to stand out from the competition and build customer loyalty. However, it involves certain risks and challenges to consider so as not to miss out on the implementation of the strategy.