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What is the difference between niche and mass marketing? - Coggle Diagram
What is the difference between niche and mass marketing?
niche marketing
Where a business targets a smaller segment of a larger market, where customers have specific needs and wants
cons
Lack of "economies of scale" (these are lower unit costs that arise from operating at high production volumes)
Risk of over dependence on a single product or market
Likely to attract competition if successful
Vulnerable to market changes – all "eggs in one basket"
pros
Less competition – the firm is a "big fish in a small pond"
Clear focus - target particular customers (often easier to find and reach too)
Builds up specialist skill and knowledge = market expertise
Can often charge a higher price – customers are prepared to pay for expertise
Profit margins often higher
Customers tend to be more loyal
mass marketing
Where a business sells into the largest part of the market, where there are many similar products on offer
cons
lots of competition
differentiation through marketing can be expensive
not flexible to demand changes
pros
Customers form the majority in the market
Customer needs and wants are more "general" & less "specific"
Associated with higher production output and capacity (economies of scale)
Success usually associated with low-cost operation, heavy promotion, widespread distribution or market leading brands