Niche market

A niche market is the subset of the market on which a specific product is focused. The market niche defines as the product features aimed at satisfying specific market needs, as well as the price range, production quality and the demographics that is intended to impact.

Every product can be defined by its market niche. The niche market is highly specialized, and aiming to survive among the competition from numerous super companies. The interest and the creation of niche market are lead by the marketing secure needs of the companies in order to have temporal finantial stability. In this niche market they have partial control being able to apply partial monopolistic measures. It is interesting to have niche markets because are beneficial in terms of getting a good tradeoff between specialization and efficiency, with diversification and creation of market opportunities.

In practice, product vendors and trade businesses are commonly referred as mainstream providers or narrow demographics niche market providers (colloquially shortened to just niche market providers). Small capital providers usually opt for a niche market with narrow demographics as a measure of increasing their financial gain margins.

The final product quality (low or high) is not dependent on the price elasticity of demand, but the specific needs that the product is aimed to satisfy and, in some cases, aspects of brand recognition (e.g. prestige, practicability, money saving, expensiveness, environmental conscience, or social status).

See also

Business models, Market segmentation, Business Intelligence

Material

• Britten, Fleur (2006-09-29). “New meaning for the term ‘niche market’”. NY Times.

Papers

• Linneman, R. E. (1991). Making Niche Market Work: How to Grow Bigger by Acting Smaller.
• Caragher, Jean Marie (2008). Expand Your Horizons: Niche Marketing Success Stories. Journal of Accountancy.
• Parrish, E. D., Cassill, N. L., & Oxenham, W. (2006). Niche market strategy for a mature marketplace. Marketing Intelligence & Planning, 24(7), 694-707.