Success in business has become synonymous with the ability to find and infiltrate "their" niche market. And there is a lot of confusion: a niche segment of the market is confused with, the process of finding a niche market with the positioning of the product, etc. Fashion - a contagious thing. But it's not just her, "Nishing" (from the English. Niching - the process of finding market niches) today has really become an area in marketing, embodied a number of innovations on the part of market research and product promotion.
What is a niche market? How is it different from a segment of the market? How to find it?
In an era of increasing specialization and competency in every sphere of economic activity for business success than ever it is important to not only the right to determine for itself the market, but also find that it is often very narrow area, the place is not busy or not sufficiently used by competitors. It is important to find the so-called "niche market", which is hitting a new venture, a new type of production or business can become profitable and sustainable business. Niche market, like any niche at all, by definition, is something small, at least at first glance inconspicuous. According to the American dictionary, there is also such a thing niche: "The situation or activity specially designed for someone's individual abilities and character." Interestingly, the latter definition is also the best way captures the essence of the search process and the introduction of a specific niche market.
This process could be defined as the choice of the limited scope of the scale of economic activity, with sharply defined range of consumers (choice of using the so-called target marketing), which is most appropriate relative comparative advantage of a particular manufacturer. American expert Brandt in his book "Entrepreneurship", writes about this: "Smaller companies are competitive when fighting for a limited share of the spoils in the market, which themselves have chosen." The meaning of choosing a niche market - to translate the game to his field, even if the box is very, very small. And then to use properly the benefits that gives its field to any player, including a member of competition.
Niche market (from the Latin "nidus" - Female) - is limited in scope or type of business scope of business activities with sharply defined range of consumers.
A niche market is characterized by the following features:
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small and stable potential size of the market;
substantial lessening of competition.
A niche market is formed, as it were, "at the intersection" of two or more segments of different markets. Demand is very agile, changes in the needs and demands of consumers carried out so quickly that require a very high flexibility in production, to be on time and quickly meet. The scale and economic conditions in the niche market make it an unattractive not only for large enterprises and companies, but also for small companies, outsiders (not yet engaged in this business). If a firm has taken a niche market for another in the business for "no place", to compete becomes meaningless, because the financial results do not cover the costs. Therefore press competition in the niche market is much weaker.
Types of market niches
Niche market may be the result of:
Target Marketing - focus on sustainable over time, but a very small part of the market in capacity that large companies can not or do not want to learn the full extent (ie meet all the needs of consumers in this market) and where the press is weakened competition for a long time;
of a particular situation in the market - a certain confluence of conditions and circumstances of economic activities (for example, as a result of the actions of public authorities) that causes the unique needs and demands of consumers that can not be met using already available on the market of products and services;
vertical marketing to search for the so-called vertical market niches. This finding ways to implement a single product with functionality (consumer properties) of the like products for different consumer groups (in several segments of the market at the same time);
Horizontal marketing to search for the so-called horizontal niche market. This approach assumes a constant expansion of the range of products and services company, focused on one target market segment;
"Cluster well" ("beam") marketing - a niche market by forming a circle of regular customers (so-called focus groups), attracted a full set of offered products and services for various functional (sectoral) destination that consumers can get these in one place (in one dealer, manufacturer or supplier).
Vertical marketing was a kind of precursor to marketing to niche vertical search market. The essence of such marketing in the search for the implementation of this article or group of functionally similar products for different consumer groups. Expensive way was to develop a vertical marketing, production and sales of various computer for each individual market. Much cheaper there was another way: to manufacture general purpose machines that can perform different tasks depending on the specific areas of use, thanks to the variety of its procedures and software.
Marketing to niche vertical market rarely implies the creation of this niche and its subsequent retention of an unaltered. In today's rapidly changing world is very dynamic process is not only a search for a niche market, but also work in it. An enterprise operates in a vertical niche market, you should keep in mind that he has to constantly shape the market for their products, rather than trying by all means to keep the old, or some part of it.
Another type of marketing associated with finding a niche market is the so-called marketing to a horizontal niche market. The essence of this marketing - customer satisfaction on a whole range of products and services in which it may require.
Unlike marketing to vertical niche market, this type of marketing involves the diversification of production to the manufacturer's release of the increasingly wide range of products or the provision of more and more complete set of services to its customers, regardless of whether there is between those goods or services is a close functional relationship.
Working in a niche market often for business or company becomes a constant search of new market niches, the formation of the so-called "bush niche market." This is due to the fact that the conditions that caused the emergence of this niche may change at any time. Sooner or later the market niche may be exhausted. For a variety of reasons. For this you need to be prepared. Then your goal is to look for the following niche market, you will be able to re-orient their business or company.
The niche may eventually grow into a new market with a massive consumer. If this happens, it is best to continue to focus its business on this niche. But while your company should certainly be some attributes of a large company. First of all, it must be ready to fight for market share in its well-studied field.
However, if you behave as a small businessman, you have to think about how and when to leave your niche market and move your business to some other niche that you can find or create. If the niche market can grow quite large business, then there exists any large company that wants to buy you for your business.
However, you can decide to diversify their production and become a kind of conglomerate of niche markets, not related to each other industrial cooperation. But for that you need to become a large company, and not by a small business.
Always keep in mind the difference in approaches to marketing in both cases. Marketing of products of mass production is aimed at the delivery of hundreds of kinds of products to millions of consumers who need them. Marketing to a niche market - this is the way to delivery a few hundred more than a million consumers a variety of products.
The main problem in terms of marketing on a niche market is the ability to translate existing unmet needs of people with language needs and preferences, feelings and perceptions into specific products and services, the issue of which you need to master the implementation and which should be implemented. Currently on the market there are plenty of opportunities for a successful combination of products, information and services under the roof of one of the company so that it can offer its customers something unique and unrivaled in what they need or what they want. Any combination of three components (a product information services) can be innovation on the market. The only important thing is not to make a mistake in assessing the market potential of the innovation to business brought in enough profit.
How to identify a niche market
To choose the right niche market for your business, you should first try to find a practical application of your own abilities, knowledge and skills in the market. Many successfully operating in niche markets of their achievements are not required to ensure that their leadership has sought to create a new product, and the fact that it is being introduced and promoted in the market the same product or service that other firms, but a completely different way. Today, deep specialization is required not only in technology but also in the methods of working with consumers. Therefore, one way to determine a niche market is an innovation in the field of realization of its products and services. The experience of developed countries confirms this.
The process of identifying a niche market often resembles a search space, a market vacuum that must be filled as soon as possible. In fact, a niche market - it is the combination of pressing and quite aware of the need to not fully conscious, non-traditional forms, methods and techniques to meet them. The task of marketing is just the definition of the place and the method of solving existing problems in consumers. Today, in any economy niches arise even in traditional industries, a long time ago on the divided markets.
The exceptionally high quality of the products and services most often is one of the most important conditions for successful implementation and operation in a niche market. The experience of developed countries shows that the management of each company, which operates in a niche market is convinced that the quality of their products or services is the highest in the industry or market. The employees of these companies have a sense of genuine pride in the quality of products, in the manufacture and sale of which they are involved. Consumers and customers of the company are also feeling a lot of value of goods purchased.
The ability to be responsive to any changes in supply and demand in the market, the business environment and the actions of competitors, see today that will be clear for all to-morrow, to make the, as yet unclaimed knowledge and experience in a new field - these are the characteristic features of the enterprises and businesses that cater to a niche market.
The financial aspects of the work on a niche market
It is not always possible to work successfully in a niche market, being a pioneer in the field of business. The famous American entrepreneur L. Wood, for example, keeps repeating that it is better to buy the business (of a company), you start all over again. He was echoed by L. Beykland, founder of the American company "Bekele," which emphasizes that there should be a pioneer, it does not pay off. Let someone else be the pioneer, and only then, when it will be seen that to what can be on a larger scale to repeat the same thing.
Focusing on a niche market is directly related to the efficiency of production, because it allows to reduce the overhead, including a meaningless advertising, transportation costs, etc. However, finding a niche market is not limited to the actual analysis of the market. Modern Marketing still required and the appropriate organization of the case. Need more people who have been able to establish so narrowly specialized economic activity, we need enterprise, commercial sophistication of mind, a kind of prescience of changes in the market situation, the ability to take risks, and other related features. This fact played an important role in the development of so-called "intrapreneurship", forming the so-called intra-entrepreneurship.
However, the problem lies in the fact that large corporations in this field tend to have failed. Attempts to include in its membership or to resolve small fast-growing company, entered into an insoluble contradiction with the organizational culture of big business. As a result, initially impregnated with an entrepreneurial spirit, focused on a niche market, flexible, mobile and small companies, becoming a major part of the leading American corporations began to lose its competitive edge and often turned out an original and attractive to consumers enterprises into standard plant or production line of industrial giants.
Rough plan of action to find a niche market
1. Determine which approach to finding a niche market most appropriate comparative competitive advantages of your company or firm:
targeted marketing;
Search vertical market niches;
Search horizontal niche market;
"Bush" ("Beam") marketing;
the other (not shown above)?
2. What are the unique knowledge, skills, qualifications, etc. have you or your company? How can they be applied in the framework of the approach to finding a niche market?
3. What changes have taken place of business conditions in the region, marketing your products or services in a prospective region for marketing your new business:
in the civil law;
the actions of local authorities;
in the actions of companies that dominate the market;
other modifications (not shown above)?
Whether these changes have weakened competition in any kind of business?
4. How have these changes affected the potential consumers?
5. Identify the potential capacity of your chosen niche market. Match it with a break-even point of your business.
References
For preparation of this work were used materials from the site http://www.elitarium.ru/
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