Global Neche Markets (section 19)

Question 1

Whats a global niche market

Answer 1

Made up of several small niche markets in different countries

Question 2

Advantages of a global niche market

Answer 2

Risk can be spread- The global niche markets are made up of several small niche markets, therefore the risks will be spread amount them and if one of them was to fail, they will have the others to rely on

Charge higher prices of the products- usually they sell price in elastic products, therefore can charge high prices to maximise profits

Minimal competition and often a high customer loyalty

Question 3

Disadvantages of a global niche markets

Answer 3

Can’t benefit from economies of scale so unit costs will be higher

Low sales volume, wont get much revenue compared to the mass markets

Attract competitors- which could lower market share

Question 4

Identify the marketing mix

Answer 4

Product

Place

Price

Promotion

Question 5

How is the marketing mix adapted for a global niche market

Answer 5

Product- products are differentiated to meet customers needs

Price- a firm can charge premium prices to maintain the exclusivity of the product

Promotion- adverts are going to show how the product is specific to the customers

Place- A firm selling a small number of exclusive, high quality outlets and distributors