Niche Market

Definition

• A niche market is a very specialized, focused, and targeted market.
• Represents a small percentage of all customers.
• Example: The wedding cake market.
  • Very small percentage of the population is interested in buying a wedding cake at any one time.

Characteristics

• Suppliers create custom-made products or services for niche consumers.
• Example: Low-carb foods.
  • Targets people with specific dietary requirements.

Shopify's Definition

• A niche market is a subset of a larger market with its own particular needs or preferences, differing from the larger market.

Examples

• Mainstream vs. Niche
  • Mainstream: Men’s shoes (not specialized).
  • Niche: Shoes for plus-sized men or male soldiers.
• Even large corporations can have both mainstream and niche products.
  • Example: Toyota with mainstream cars and Lexus as a niche luxury car.
• Large markets have specific subsets.
  • Example: Makeup market with niche products for sensitive skin or professional artists.

Benefits of Focusing on a Niche Market

• Greater conversion rates.
• Higher margins.
• More effective sales strategies.
• Customer loyalty.

Niche Marketing

• Marketing personnel channel all their efforts toward a specific segment of the population.