Advantages and Disadvantages of Niche Marketing are as follows, So let us check it out one by one.
The following are the advantages of niche marketing :
1. Less Competition
Niche marketing has comparatively quite less market competition for the viable competitors purchasing services or products.It helps business to build their brand loyalty.
Niche marketing generally focus on small groups of people, hence it is cheaper to start as low cost operations involved. It is good place to build customer rapport and it also gives plenty of time to design marketing strategies.
3. Brand Loyalty
Niche marketing differentiate your brand from other competitors, It focus on small group of people and build strong customer relationship by offering proper customer supporty. Niche marketing helps to build strong brand loyalty.
4. Best for giving marketing insights
Niche marketing focus on unique market segment. Marketing strategy can be decided using trends and competitive insights.
5. Save marketing cost
Niche marketing is a cost effective, It helps in saving marketing cost. Brands can directly target their potential customers.
Niche marketing improves unique conversion rate, it enables brands to reach profitable customers in a more personalized way.
7. Competitive Advantage
Niche businesses specialize in a specific product or a services, often allows them a competitive advantage over other type of businesses. Effective marketing strategy can be planned because the target customers are already decided.
8. Customer Satisfaction
NIche market is often created by identifying customer's specific needs and wants, providing customer care service, live chat, phone service increases customer loyalty and customer satisfaction.
Niche marketing leads to reliable and trusted brand for specific type of product and services.
10. Targeting Customers
Potential customers are identified and the campaign are designed according to their wants, more chances of conversion by focusing target customers.
The following are the disadantages of niche marketing :
The key to niche marketing is to identiy profitable segment, not all niche market are profitable.
Niche marketing works best when a business is specialize in a particual product or services, particual demographic within its target audience
3. Limited Growth
The growth of nich business depends on well defined marketing strategies, growth is limited if they are not executed properly.
4. High risk
The risk may be high because only one product or category is marketed, but it may be lowered if the market size is huge.
5. Smaller market
Niche market focus on smaller segement hence less profit, once it becomes popular then the business can start making profits.
6. Change in Demand
Niche market may gets affected if the demand of particular product or services changes.