Niche Markets (Edexcel A Level Business)

• Cultural diversity recognises the ideas, customs and social behaviour of a particular people or society in different global markets 
  
  
• Businesses need to take into account the different cultural behaviours and customs when operating in overseas markets
  • E.g. In India, beef and pork are not consumed for religious reasons. Fast food outlets have adapted their menu to take this into consideration 
  • E.g. In the United Arab Emirates there are rules around the consumption of alcohol that businesses need to adhere to 

• Global niche markets are small segments of the global market that are characterised by unique and specific needs and preferences
• Groups of customers within these markets are sometimes referred to as subcultures
• These groups may be very small within an individual country, however when combined across the world the number of customers may be significant
  • E.g. Halal products are produced and prepared according to Islamic laws and regulations
  • They are in high demand in Muslim-majority countries and businesses that offer them can tap into this market and cater to the specific needs of Muslim consumers
     

Features of global niche markets 

• Excellent Customer Service
  As customers are usually paying higher prices for the product/service they expect exceptional customer service
   
• Innovation
  Innovation ensures that products are highly differentiated and maintain a unique selling point (USP) that meets the needs of the target market
   
• Prioritising profit over market share
  Niche markets are lucrative and businesses focus on increasing profits that they can re-invest into improving their products/services 
   
• Expertise in product area
  Having employees that are highly skilled and keeping up to date with the latest developments within the niche market helps to build value for the customers
   
• Emphasis on quality
  Businesses need to ensure the quality of the product is exceptional as they are targeting wealthier customers who pay for high value products
  
  
• Clear understanding of the wants and needs of customers
  The business may have relatively few customers so needs to ensure that the needs/wants of these customers is fully understood

• Adapting the marketing mix to suit global niches involves tailoring the 4Ps of marketing (product, price, place, and promotion) to meet the specific needs and preferences of a particular niche market
   
• Product
  One way to adapt the product to suit a global niche market is to modify the features of the product to meet the specific needs of the target audience. E.g. A business that produces luxury watches can offer a line of vegan watches for consumers who are looking for high-quality and exclusive products that are also cruelty-free
   
• Price
  Adapting the price to suit a global niche market involves offering a pricing strategy that is attractive to the target audience. E.g. A business that produces organic products can offer competitive prices similar to mainstream products to attract consumers who are looking for healthy and sustainable options. Alternatively, a business that produces sustainable fashion can offer a premium price that reflects the exclusive and high-quality nature of the product
   
• Promotion
  Adapting the promotion to suit a global niche market involves using marketing communication strategies that resonate with the target audience E.g. A business that produces luxury products can use influencer marketing to communicate the exclusivity of the product to wealthy customers
  
  
• Place
  Adapting the place to suit a global niche market involves choosing a distribution strategy that is convenient for the target audience E.g. A business that produces gluten-free products can distribute them through local specialty stores and online platforms to reach customers