What is Market Niche? Definition of Market Niche, Market Niche Meaning and Concept
A market niche is a portion of a market segment, which is made up of a small group (either people or companies) that have certain common characteristics and needs.
It is important not to confuse the concept of market niche with that of groups created through market segmentation. The latter tend to be larger and more complex when it comes to being identified.
An example to differentiate between niche and market segment is the case of a bakery, where the market segment would be the people who consume bread and a market niche could be the people who consume whole wheat bread.
Characteristics of market niches
Companies usually look for a specific market niche to which they can direct each of the products they work on. Normally, market niches have certain characteristics for which they are considered as such.
- These are small groups and identifiable by their customs or behavior.
- They share similar needs and preferences.
- They still do not have (or there are few) suppliers that provide them with the goods or services that satisfy them in a specific need.
Thanks to the operation through the search for market niches, it is possible to save time and resources. Since they are oriented to the selected niche in question and it will only be necessary to create a personalized sales plan instead of carrying out a large advertising campaign that is massive and, therefore, expensive.
But not necessarily by targeting a more select or smaller part of the market there will be lower income or sales. Many companies regularly obtain great results operating in this way and focusing their operations and production on selected market niches in relation to their product.
Capturing the favor of a niche market made up of identified consumers with select tastes can be a good way to gain recognition and success for small, medium and large corporations. For this, the importance of specialization at the time of the production and development of its products would come into play.